What are the duties of an oil or gas company under an oil and gas lease?

 

A: In addition to specific obligations that are spelled out in an oil and gas lease, oil and gas companies have certain express and implied duties under Texas law. Among them are the following:

  • Duty to Develop - An oil and gas company may have an implied duty to develop the lease to the extent that a reasonable and prudent operator would have.
  • Duty to Protect against Drainage - An oil and gas company may have an implied obligation to drill an offset well to protect a common reservoir from drainage if a well is drilled to extract its resources from an adjacent tract of land.
  • Duty to Market - Courts impose upon a lessee the duty to market hydrocarbons produced from a well and to obtain the best price and terms possible for the sale of production.





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The Voss Law Firm, P.C. represents clients on a local, national and international basis. We proudly serve all Texas counties and cities including but not limited to the following: Harris County, Montgomery County, Jefferson County, Houston, The Woodlands, Beaumont, El Paso, San Antonio, Austin, Sugar Land, Dallas, Fort Worth, Orange, and Port Arthur, as well as companies and individuals along the Gulf Coast and around the globe.

 



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