valorem taxes in many circumstances. [5] Id . [6] Id . at 423-4.
the boundaries of the taxing unit merely by virtue of the fact that they are included in a production unit pursuant to a pooling agreement. No statute provides that pooling results in a cross- conveyance.” Id . at *11. _____________________________________________ CONTACT If you have any questions regarding this case law update or suggestions for topics to be covered in future issues, please call our office at 713-229-0360 or contact:
[7] Id . at 425 (“SCAD failed to establish that [the Chambers] owned an interest in pooled minerals located in San Augustine County, and thus had an obligation to pay taxes in that county.”) [8] Id . [9] 618 S.W.3d 398 (Tex.App.—Tyler 2021, pet. denied).
[10] Id . at 401. [11] Id . at 402.
[12] Id . [13] Id . [14] Id .
Brad Gibbs Partner, Houston bgibbs@oglawyers.com
[15] Id . at 403 (“SCAD can tax minerals outside San Augustine County when cross-conveyance theory is properly applied. No Texas statute provides for taxation of minerals outside the boundaries of the taxing unit merely by virtue of the fact that they are included in a production unit pursuant to a pooling agreement. No statute provides that pooing results in a cross-conveyance. [The Chambers’] leases prohibit cross-conveyance of interests. SCAD is required to apply the law, even if it means adapting as the applicable law is clarified through the judicial process.”). [16] The Court also noted that this holding is consistent with Texas statutory law. “No Texas statute provides for taxation of minerals outside
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Nettye Engler Energy, LP v. BlueStone Natural Resources II, LLC
Texas
all minerals in place. The deed required delivery of the grantor’s fractional share“free of cost in the pipe line, if any, otherwise free of cost at the mouth of the well or mine[.]” The parties agree that a gas pipeline exists and that the royalty is free of production costs and postproduction costs incurred before delivery into that pipeline, but they disagree about its location under the deed’s terms.
The Supreme Court of Texas handed down its opinion on February 4, 2022:
This mineral dispute involves a frequently litigated issue: whether and to what extent a royalty interest bears a proportionate share of postproduction costs. Here, the deed conveying the mineral estate reserved a nonparticipating royalty interest“in kind,” which means that, unlike a monetary royalty, the grantor retained ownership of a fractional share of
The grantee’s successor maintains that delivery
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G rowth T hrough E ducat i on - J uly / A ugus t / S ept ember 2022
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