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W.Va. Couple Lose Battle to Cancel Oil and Gas Lease in 4th Circuit Appeal

On May 7th the Fourth Circuit Court of Appeals rejected the arguments of Martha and Charles Wellman and upheld the validity of a “legacy” oil and gas lease.  The lease provided for royalty payments on production and a flat-rate rental payment.  The mineral owners alleged that Bobcat Oil & Gas, Inc. failed to produce oil or gas under the lease, and breached the lease by missing rental payments, resulting in forfeiture of the lease.  As the West Virginia Record noted, the Fourth Circuit upheld the lease under its original 1933 terms, stating that the lease could be maintained solely by payments of the flat rental, and that the missed payments in this case were not such that warranted termination of the lease.

A copy of the unpublished opinion from the Fourth Circuit can be found here.