Mayhall Fondren Blaize

Louisiana company in midst of lease dispute with Interior Department

Lease enforcement is an important issue in industries that are real estate dependant. This is especially the case in the oil and gas industry, where access to valuable resources is often determined by lease agreements. When a business is unable to benefit from a lease, the lease isn’t worth much, and legal action may need to be taken to sort things out.

Take, for example, oil and gas lease dispute connected to a site located in the northern part of Badger-Two Medicine area, part of Montana’s Lewis and Clark National Forest. The lease covers 6,200 acres near Glacier National Park, and falls on ground considered sacred to American Indians.  

The lease is owned by Baton Rouge-based Solenex LLC, which has owned the lease since 1982 but has been denied access for drilling. In 2013, Solenex filed a lawsuit against the federal government in an effort to enforce its lease. Last November, the Department of the Interior announced that it would seek cancellation of the lease on the grounds that it was not issued properly, despite previous determinations that the lease was valid.

In December, an agreement was reached to delay the case one month in an attempt to settle out of court, but the attempt at settlement failed and the parties ended up back in court last month. Solenex is asking the court to halt to the lease cancellation, or at least to compensate the company if the lease is cancelled.

In any dispute involving oil and gas leasing, it is important to work with an experienced attorney who understands the court system, the legal issues and the industry.  In future posts, we’ll explore the topic of oil and gas leasing more.

Sources:

Montana Public Radio, “Judge Asked To Halt Cancellation Of Badger Two-Medicine Energy Lease,” Jan. 20, 2016.

Flathead Beacon, “No Deal in Badger-Two Medicine Energy Lease Dispute; Lawsuit to Proceed,” Jan. 18, 2016. 

No Comments

Leave a comment
Comment Information