Untitled Texas Attorney General Opinion

OFFICE OF THE ATTORNEY GENERAL OF TEXAS AUSTIN GROVERSELLERS Al-rORNLY GINERAL hl Non. 01111 Culbarson, Ohalrram Railroad Coxnlaoion 0r Tams kuatln, Toxaa 1)4ar $1~ O&dnlon No. O-7046 ..~_- ,, ‘\ ,,/: suah sroaptlonr in rant only ona we&l to ~411 ohall b4 lQcret4d. / Hauklna town8lt4. applloanto ooto or th0 0m4r or Hon. GlIn Oulberson - ?sgs 2 arter dlsoorsry. llwir8siainlngtwo lots w4re 14assd to oth4r parties, also 8rt8r a4 Ol4oor4ry. All lots am adJoinin& sad oontiguous. wn4 or th4 appiiasnt*8 188848 rro81 th8 origi- ml omer or ths rour eubtllvldad lot8 Is prior in point ot time to th4 14ese on th4 oth4r two lots. Thlr eppllsant oontends that ths les80x-sand. orl@.nal owmrs oi th4 rour lots havs s right to at least one well on said rbur lots (The Ossmlsslon Is agreeable to thla oontantlon but he8 hersto- tore retused sppliostlonstar oae no11 011essh or the two subdlrlbedlots); thst their 144se, being prior in point o? the to tk4 leas4 on the other two lots, they (the applioants) are entItle to a prior right to a permit as ocmpared with those holding a subrepuentlease on the other two lots. '1 wish to ysln rapeat that the Oosuslsslon has held that oaly one well saribe drlllsd on these iour lots, and we have not berm oonsiderfa# the louatlon or ths well anywhere other than as shore-mentions&. *At ths NQINIS~ oi applf4ants,the tOllowing law question is propouadedr wC,%LGTIGNz rdlhere8 tM4t of land is segrb- gat4d In areas *hi&# oannot be drilled exoept under exoaption to Rule 37, 4008 the holdar ot th4 rirat lease granted (oonslderatioxi of waste exaeptad) hsrs a prhr right to a perthit uvef th8 holder or a uubsepusnt lease?* The desorlbsd iaot situstlon 18 an ultLgat4 resbilt or the applisation of Rule 37 and Its allowsble oxosptloasto the Hawkins Fielilor East !B~xa8. 3~4 ownerof the four lets Is entitled to but one w4ll. He oannot expand this right by & voluntsry rubdivisionu&d thereby ozwita a rl6ht in hiaseli, of in a~ lessee, to an adbitlenal wall. Bun Oil 0smpan.yVs. Railroad Commlsslon,68 9. a. (24) 609. Nevertheless,the o wner -lesso r h a d le4n rit to qndt an‘011 *ad gas lrase to two or the lots to one lessee, and. at a lst4r dsta, an lddltlo a a l Hon. Olin Oulknoa - Page 3 lease on the other two lots to another lessee and without any exDMS* OOnV%yMoo Or his right to thr on4 wall to either lessee. % assume that the 011 and gas leasae to th4 two lesseea ~ployed the same and standard form with respeot to QrIlllng rights. Extenslre researoh Indloatesthat the preolse question at hsnd.ia one or rlrat impression. Is the sane of Railroad Ods*ioR, et al, *a. MillFr, 165 9, W. (26) 504, the court 8p~oifioallYreS~:m~d the question of the.legal erred or the two oIr4umstano4s: (1) a small trsot whloh osn be dorrloped only under exseptlon to Rule 37 to proteot rested rights, and 85 SUSh entitled to but on4 well; and (2) the hota of a prior and OS a subsequentlease on subdltIslonsof the tra4t without an express oonvaysnoeby the owner-lessorot the right to the on4 lllswable well. W4 are of the opinion that the legal etrest of the first lease in relation to the seoon&, in the respeots about whloh you lnqulr4&-wheth4r desmibed aa an Implied conveysmoe of the lesaor*s right to drill th4 one null, or the granting to the first lessee or a prorerentlal right to drill suoh well, or otherwIse--1sto gir4 to ths first lessee a prior right to a permit to drill as against the holder of the sub8equentlease. Th4 pronounowmnt or the Court ti Edgar, et al, vs. Stanollnd 011 & Gas Gompsny, 4t al, 90 8. W. (26) 656, writ refused, that a subsequentlessee "4ould insure no greater rlghd under the law than that vest4d in his lesaors~ Is persuaslYe by analogy.. It Is believed that frarpany approach to thb question, the first lsS444 la in the stronger legal and oqultableposition. For example, under the applloatlon of'th4 imputed notioe dootr$se (see 31 Tex. SW. pp. 363, 3641 Bsloher Land Mtg. 00. vs. 01-k. 238 s. W. 685)--iand 'ehsfaotcand 4lrWWt4nO~are smple, in 0~ opinion, for its a plioatlon--theseoond lessee is ohar ed with notio4 of the raot or the first lease, together with de sorollary ra4t that the lessor had pr4TIously dirested himuslf of auoh‘rightsas wm granted In the 011 and gas less4, On4 of whloh Gas the right to drill. Therefore, under the faata stated in your Iauufr~, ,md expr4sslylimited to fmoh raots. Your we8tion I* snrmr4d In the afflrmatire. we express no opinion upon t&e question of th4 right* or we moon& leasee in event or dralnaao or hi* leasrhold by Ron. Olin Culborean - Page 4 the first well (sea Magnolia Pet. Co.~rs. Blankenshlp,et al, 85 Fe+. (2Q) 5531, or upon any questiona whioh might subsa- quently aria4 oonosrnln(r. additionalwell8. Yours very truly ATTORNZYOgagRALOFTEXAS BY Asslstanf