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Contracts Keyed to Dawson
Seagull Energy E & P, Inc. v. Eland Energy, Inc.
Citation:
207 S.W.3d 342.Facts
In 1994, Eland purchased interests in two oil and gas leases in the Gulf of Mexico: Block 828 (1.089375% interest) and Block 831 (9.41719% interest). As an owner, Eland assumed certain obligations under the Operating Agreements for each Block. Pursuant to the Operating Agreements, Eland was to share the costs of operations proportionally to its interests. Seagull was a lessee and operator of Blocks 828 and 831. In July 1996, Eland sold its interests in the leases to Nor-Tex and assigned its rights and duties under the Operating Agreements. However, Nor-Tex failed to reimburse Seagull for its share of the operating costs and Eland refused to pay since it was no longer an owner. The Operating Agreements generally referenced assignment of obligations to other parties to the Agreements, but made no reference to the consequences of an assignment to third parties.
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