Opinion ID: 1225461
Heading Depth: 1
Heading Rank: 4

Heading: Johnson v. Jernigan

Text: ¶ 7 In Johnson, gas lessors alleged that the lessees wrongfully deducted transportation costs from their 1/8th royalty interest in the gross proceeds from gas production under the lease. Since there was no market on the leased premises ( i.e., no willing buyer), the court allowed the lessee to charge against the lessor's royalty interest a share of the costs of transporting the gas to the nearest market. [9] The court declared that the lessee's duty to market the gas does not include bearing the full cost burden of transportation to an off-site purchaser. [10] Rather, the lessee's financial obligation ends when the gas is made available for market, and any further expenses beyond the leased property must be shared by the lessor. [11]