Court Opinion

ID: 3472396
Source: CourtListenerOpinion
Date Created: 2016-07-05 20:42:09.549955+00
Date Added: 2024-06-11T14:24:30.758553
License: Public Domain

J. R. Parten in his petition for a rehearing contends that the drilling permit under which the Hunt Oil Company drilled the well on the SW1/4 of SW1/4 of Section 13 was not a valid order for the unitization of that tract with the SE1/4 of SE1/4 of Section 14, so far as Parten was concerned, because he was not given notice or an opportunity to be heard before the permit was granted.
We agree with counsel for Parten that the Order No. 10 of the Commissioner of Conservation, by which he adopted a drilling unit of 80 acres for the Bodcaw sand, in the Cotton Valley Field, and which became effective on July 24, 1937, did not mean that the Commissioner thereafter might grant unitization orders without giving to all parties having mineral rights in any part of the area to be unitized due notice and an opportunity to be heard. Such notice is due particularly to parties having a mineral interest in only a part of the area intended to be unitized, or having a greater mineral interest in one part than in another part of the area intended to be unitized. Whether such notice is due to parties having the same mineral interest in one as in *Page 710 
the other or the others of the two or more tracts intended to be unitized is a matter which we are not obliged to decide in this case, because, as we stated in our original opinion in this case, the parties having such uniform mineral interests in this instance are not complaining. In fact J. R. Parten is the only one who is complaining of the failure of the Conservation Commissioner to give notice to the parties owning the royalty interests in the SW1/4 of SW1/4 of Section 13, of the application of the Hunt Oil Company for a permit to drill a Bodcaw well on that 40-acre tract and to consolidate with it the SE1/4 of SE1/4 of Section 14 for the purpose of making up the necessary 80-acre drilling unit. Parten's complaint is founded of course upon his having a greater mineral interest in the 40-acre tract on which the well is located than he has in the other of the two 40-acre tracts composing the necessary 80-acre drilling unit, or production unit. He owns three-fourths of the one-eighth royalty interest in the 40-acre tract on which the well is located, and owns only one-eighth of the one-eighth royalty interest in the other of the two 40-acre tracts which compose the necessary 80-acre drilling unit. The reason why the owners of the other fourth interest in the one-eighth royalty interest in the 40-acre tract on which the well is located are not complaining is that each of them has the same interest in one as in the other of the two 40-acre tracts composing the necessary 80-acre drilling unit, and therefore each of them is entitled to the same share of the production from the well on the SW1/4 of SW1/4 of Section 13 as if that 40-acre tract — on which the well *Page 711 
is located — had not been unitized with any additional area.
But the fact that the owners of the one-eighth royalty interest in the 40-acre tract on which the lessee, Hunt Oil Company, intended to drill and did drill the well were not notified of the intention to unitize that tract with the adjoining 40-acre tract, in Section 14, does not entitle the owners of the one-eighth royalty interest in the 40-acre tract on which the well is located to take all of the one-eighth of the production of oil and gas, and thus to deprive the parties owning the one-eighth royalty interest in the other one of the two 40-acre tracts composing the necessary 80-acre drilling unit of their half of the one-eighth royalty interest in the production from the 80-acre drilling unit.
We must bear in mind that, under the provisions of Order No. 10, which is conceded to be a valid regulation of the production of oil and gas from the Bodcaw sand, in the Cotton Valley Field, this well, which is located on the 40-acre tract in which Parten owned three-fourths of the one-eighth royalty interest, could not have been drilled on that tract without its being unitized with one of the four adjoining 40-acre subdivisions. And it is not contended on behalf of Parten that he would have shared better if this 40-acre tract on which the well is located had been unitized with one of the three other adjoining 40-acre tracts, instead of the SE1/4 of SE1/4 of Section 14. On the contrary, as Parten owned one-eighth of the one-eighth royalty interest in the SE1/4 of SE1/4 of Section 14, and as there is no claim that *Page 712 
he had any mineral interest in any other of the four adjoining 40-acre subdivisions, the presumption is that it was advantageous to him to have the SW1/4 of SW1/4 of Section 13 unitized with the SE1/4 of SE1/4 of Section 14, rather than to have it unitized with any of the three other adjoining 40-acre subdivisions.
Aside from Parten's failure in this suit to show or aver that he suffered a disadvantage by the unitization of the SW1/4 of SW1/4 of Section 13 with the SE1/4 of SE1/4 of Section 14, he does not show or claim that he might have opposed successfully — or that he would have opposed — the application of the Hunt Oil Company for a permit to drill the well on the SW1/4 of SW1/4 of Section 13 and for that purpose to combine that 40-acre tract with the SE1/4 of SE1/4 of Section 14 in order to make up the necessary 80-acre drilling unit. The presumption is that Parten would not have opposed the application — not only because an opposition to it would have been against his interest but also because it would have been without avail.
If it had been possible legally — in the face of the Conservation Commissioner's Order No. 10 — for the Hunt Oil Company to drill a well on the SW1/4 of SW1/4 of Section 13, to the Bodcaw sand, without unitizing that 40-acre tract with one of the 4 adjoining 40-acre subdivisions, the so-called "allowable" of production from the 40-acre tract on which the well was drilled would have been exactly half as much as from a well drilled on an 80-acre drilling unit. I am referring now to the provision in Subsection (6) of Section 6 of Act No. *Page 713 
225 of 1936, making provision for the drilling of a well on an area less than 80 acres where the area is of such shape or so situated as to make it impossible to attach it to an adjoining tract of sufficient area to make up an 80-acre drilling unit. The SW1/4 of SW1/4 of Section 13 was not so situated as to exempt it from the requirement to be unitized with an adjoining 40-acre subdivision.
In Parten's brief in support of his petition for a rehearing attention is directed to the fact that there are two producing wells on the SE1/4 of SE1/4 of Section 14, one in the Glen Rose formation and the other in the Travis Peak formation, and that the production from these wells has been shared exclusively by the owners of the mineral rights in that 40-acre subdivision. But it is admitted that the drilling unit, or production unit, that was established by the Conservation Department for the Glen Rose formation and for the Travis Peak formation is 40 acres, and not 80 acres, as in the case of the Bodcaw formation — which is a deeper formation. It is conceded also that to require an 80-acre drilling unit for the Bodcaw formation, with only a 40-acre unit for the Glen Rose formation and for the Travis Peak formation, is within the police power of the State and within the authority of the Department of Conservation. Hence the fact that the owners of the mineral rights in only the SW1/4 of SW1/4 of Section 13 have not claimed any share in the production from the Glen Rose well or from the Travis Peak well, on the SE1/4 of SE1/4 of Section 14, has no bearing whatever upon the right of the owners of *Page 714 
the mineral interests in only the SE1/4 of SE1/4 of Section 14 to receive one-half of the production from the Bodcaw well, on the other of the two 40-acre tracts which compose the required 80-acre drilling unit.
As far as the record in this case shows, the failure of the Hunt Oil Company and of the Conservation Commissioner to notify the royalty owners that the company had applied for a permit to drill a well to the Bodcaw sand on the SW1/4 of SW1/4 of Section 13 — and for that purpose to unitize that subdivision with the SE1/4 of SE1/4 of Section 14 — was not only harmless but apparently unintentional. The Hunt Oil Company, as lessee, owned the seven-eighths working interest in the oil and gas in the whole 80-acre tract, and, obviously, assumed that the owner or owners of the one-eighth royalty had the same interest in one as in the other of the two 40-acre tracts composing the drilling unit. But it serves no purpose now to discuss the question as an abstract proposition — whether these royalty owners should have been given due notice and an opportunity to be heard before the Conservation Commissioner acted upon the application of the Hunt Oil Company. We must consider and decide the case as we find it. The granting of the drilling permit, coupled with the unitization order — the drilling of the well and the production and sale of the oil and gas — constitute un fait accompli. All the king's horses and all the king's men could not reinstate the status quo ante again. As Grover Cleveland declared in one of his famous messages, "It is a condition which confronts us — not a theory." Our conclusion *Page 715 
is that the decision which we have given in this case is the only just one that could be given.
The petition for a rehearing is denied.
FOURNET, J., dissents, being of the opinion that a rehearing should be granted.
PONDER, J., takes no part.