VICTORIA, Texas, Oct. 10, 2016 /PRNewswire/ -- Attorneys representing oil and gas royalty owners with interests in the Texas Eagle Ford Shale have filed a federal lawsuit against Talisman Energy USA Inc. based on claims that the company manipulated oil and gas production volumes by as much as 20 to 30 percent and consistently shorted royalty payments.
Attorneys from Texas-based Provost Umphrey Law Firm, L.L.P., are representing Eugene and Kimberly Cran of DeWitt County in their claims against Warrendale, Pennsylvania-based Talisman.
Talisman entered the Texas oil and gas market in 2010 by acquiring leases and wells in the Eagle Ford Shale under a 50/50 joint venture agreement with Norway-based energy company Statoil. Today, the joint venture includes some 4,500 oil and gas leases covering 59,000 net acres and 494 producing wells. In 2014, Talisman reported its share of Eagle Ford production topped 22,000 barrels of oil/condensate per day and represented approximately 20 percent of its proven reserves.
In July 2013, Talisman and Statoil revised their agreement to allow Statoil to assume well operations for half of the Eagle Ford joint venture, while Talisman remained the operator for the remaining wells. As a result, the Crans and other royalty owners began receiving monthly checks from both companies rather than Talisman alone. Shortly after the transfer of operations, the Crans began receiving checks from Talisman with substantial variances in production volumes compared to those reflected in their Statoil royalty payments. The lawsuit refers to these shorted production volumes and shorted payments as the "skim."
Talisman is accused of secretly altering wellhead production data by arbitrarily reducing the measured volumes of oil and gas by as much as 20 percent. The royalty owners say Talisman further reduced the measured volumes in the spring of 2015, shortly after the company was purchased by Spanish energy giant Repsol in a deal valued at more than $13 billion. This January, Talisman gave up all operator responsibilities and Statoil became the sole operator in the Eagle Ford Shale under the joint venture agreement.
The lawsuit filed on Oct. 3 includes claims against Talisman for breach of contract, fraud, conversion and unjust enrichment, among others. A jury trial has been requested by Mr. and Mrs. Cran, who are represented by attorneys Bryan O. Blevins Jr. and Michael Hamilton of Provost Umphrey in Beaumont, Texas, and Ernest Freeman and Stephen Scholl of The Freeman Law Firm, P.C., in Houston.
"When Talisman entered the U.S. market, they were totally unprepared to manage fractional ownership interest by individual royalty owners whose rights and remedies are governed by their lease terms," says Mr. Blevins, lead counsel for the Crans and a litigator who has represented clients in Texas and across the U.S. for more than 25 years. "Our clients have been and are still being significantly and purposely underpaid by Talisman for their mineral rights, and our goal is to make sure that the appropriate parties are held accountable. Talisman's manipulation of production volumes and shorted royalty payments were intentional and may have been related to the Repsol acquisition."
This is the second oil and gas royalty class action filed this year by Provost Umphrey and the firm's lawyers.
The case is Cran v. Talisman Energy USA Inc., No. 6:16-CV-00064, in the U.S. District Court for the Southern District of Texas, Victoria Division.
About Provost Umphrey Law Firm
For more than 40 years, our firm's mission has remained to seek justice for those most in need – those who have suffered harm or loss due to the wrongful conduct of others. Our attorneys fight for our clients nationwide with offices in Beaumont and Houston, Texas, and Nashville, Tennessee. We continue to be one of the most successful trial law firms in the nation by remaining Hard-Working Lawyers for Hard-Working People. To learn more, visit http://www.provostumphrey.com.
For more information on the Talisman lawsuit, contact Bruce Vincent at 800-559-4534 office, 214-728-6747 cell, or at email@example.com.
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SOURCE Provost Umphrey Law Firm, L.L.P.