“Anadarko Case Could Reshape Offsite Drilling In Texas”
The Texas Supreme Court will hear argument Tuesday in a case that could reshape where oil and gas companies can drill their wells, particularly in the Eagle Ford and Permian Basin, as the justices are asked to decide whether drilling through one mineral estate to reach an adjacent tract constitutes a trespass.
Conrad Hester of Thompson & Knight LLP said he thinks of the case as another in a series of legal developments resulting from the use of hydraulic fracturing and horizontal wells.
The practice of offsite drilling has been in place for a long time, even when it was more common for wells to be drilled vertically instead of horizontally, he said. But this is a fairly novel area of the law and well operators are watching the case closely because it could have an impact on the way they do business, he said.
“You want your well to be as close to the lease line as possible so you’re producing from as many feet as possible,” Hester said. “That’s why these offsite lease pads have taken off, because it allows you to produce from the full acreage.”