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Attorneys continue winning streak at annual OCBA Chili Cook-off

Phillips Murrah attorneys team up for OCBA’s annual chili cookoff

Another year, another recipe vying for a coveted trophy at the Oklahoma County Bar Association’s annual Chili Cook-off.

Phillips Murrah attorneys competed against local law firms in OCBA’s Young Lawyers Division on Feb. 28 at the Leadership Square Atrium in downtown Oklahoma City.

Representing Phillips Murrah were attorneys Cody J. CooperC. Eric DavisMark E. Hornbeek, Kara K. Laster, Martin J. Lopez III, Phoebe B. Mitchell, Ashley M. Schovanec, and Molly E. Tipton.

“I always love participating in the chili cook-off, not just because I am a very competitive person (and not a sore loser at all),” Tipton said. “I always find myself making new acquaintances that I look forward to seeing again in the court house or out and about!”

Attorney Phoebe Mitchell poses with her prize-winning chili and “Hottest Chili” trophy

The Firm’s team continued their winning streak, scoring the “Hottest Chili” prize with Mitchell’s recipe.

“The secret ingredient to my chili was definitely the spicy Mexican chocolate,” she said. “We had so much fun participating in the OCBA YLD chili cook-off. It is always great to come together and compete to raise money for a worthy cause like the Regional Food Bank.”

Phillips Murrah has had at least one team compete in the Chili Cook-Off each year since it first started more than ten years ago.

In 2019, the OCBA YLD named Phillips Murrah “Friend of the YLD” for the Firm’s consistent support of their charitable efforts.

To learn more about the YLD, visit OCBA’s website here.


See more: Phillips Murrah’s Commitment to the Community

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Who should define the terms of an oil and gas lease?

Whose job is it to determine which expenses can be deducted from royalty payments under the terms of an oil and gas lease? Is it the lessee or the operator? People argue both positions and all parties desire clarity in who bears this burden.

Molly Tipton

Molly Tipton is an attorney in the Energy & Natural Resources Practice Group. She represents both privately-owned and public companies in a wide variety of oil and gas matters, with a strong emphasis on oil and gas title examination.

Unfortunately, there are many interpretations of the differing forms of deductions language in leases, and the courts have not had the opportunity to make a decision. Many operators have recently requested input from the lessee on royalty valuation, but some lessees may balk at this idea because current practice typically provides that the operator cuts the checks.

Pursuant to 52 O.S. § 570.8(A), a working interest owner in a gas well shall furnish to the operator the name, address, royalty interest, taxpayer identification number, and payment status of royalty interest owners for whom they hold a lease. While this language does not place the burden on the working interest owner to tell the operator how royalty proceeds should be valued under the terms of the lease, it is understandable that an operator wishes for input from the lessee, as they are a party to the lease.

However, when an operator asks a lessee to determine how royalty proceeds should be valued under the terms of the lease, the lessee may fear liability to the royalty interest owner in the event that the operator is paying the royalty contrary to how the lessor interprets the terms of the lease.

The lessee should take comfort in the language in 52 O.S. § 570.9(D), which states that any working interest owner that pays or causes to be paid royalty proceeds for gas production in accordance with the Production Revenue Standards Act valued according to the terms of such working interest owner’s lease shall be relieved of all liability to the royalty interest owners for any further payment of proceeds from such production.

The valuation of royalties will affect both the royalty owner and the lessee, and without any guidance from the courts, there is no definitive answer as to who should define the exact terms of the lease. One can understand why neither the operator, nor the lessee, wants the burden of defining the lease terms, as they affect royalty deductions. Only time will tell whose job it is after all.

 


By Phillips Murrah Attorney Molly E. Tipton

Gavel to Gavel appears in The Journal Record. This column was originally published in The Journal Record on May 30, 2019.