The Texas 3rd Court of Appeals recently issued the Magnolia v. Opiela decision on Production Sharing Agreement (“PSA”) wells. While this case provides a nice history of pooling, allocation wells, and production sharing agreement wells, including some strong guidance that PSA wells do not implicate pooling concerns, I believe that the 3rd Court’s narrow ruling is as significant for what it does not cover, as for what it does.
New Mexico, with its abundant natural resources, presents a myriad of opportunities in the oil and gas sector. However, the landscape is also characterized by a complex web of ownership and regulatory requirements that industry professionals must navigate. In this post, we delve into crucial aspects of New Mexico’s oil and gas landscape as outlined in the Landman’s Guide to New Mexico.
If you’re anything like me, you’ve looked back and wondered what you could have done during the ’20-’22 timeframe to position yourself even better than you are now. “Why didn’t I buy that energy stock in March ’20?” “Why didn’t I go all in on that non-op working interest in Eddy County?” Or, hopefully you’re asking, “how can I use this unlikely gift of living through COVID to inform my strategic thinking so that next time, I’m ahead of the game.” That one took me a little longer to settle on.
The exponential increase in flaring for economic reasons has become the prime mover in the current natural gas flaring discussion. For instance, from 2010 to 2019 the Texas Railroad Commission reported a 20X increase in flaring permit applications, going from approximately 300 in 2010 to 7000 in 2019. Those are big numbers, but data always needs to be kept in context. As of 2019 data, there were approximately 265,000 producing wells in the State of Texas. Against this total, the 7000 looks less staggering.
We previously covered the basics of flaring and venting, as well as took a look at where the US sits in regard to the rest of the world in terms of flared volumes. Now let’s take a deeper look at why we flare or vent in the first place.