Oil Company Denied Royalty Interests in Midwest Shale Oil Wells

An energy company doesn’t have royalty interests in two oil and gas drillers since its ownership of mineral rights only covers shallow vertical wells, not deep horizontal ones, a split federal appeals panel ruled Thursday.

Sabre Energy Corp. was denied overriding royalty interests in the Gulfport Energy Corporation and Antero Resources Corporation horizontal wells in the Ohio portion of the Utica Shale/Point Pleasant formation, a majority of the US Court of Appeals for the Sixth Circuit said. Sabre’s royalty interests in the disputed mineral leases also didn’t apply to undrilled acreage, which preempts the now-drilled land they seek royalties from. ...