Mike Blankenship Discusses Force Majeure Amidst a Potential Statewide Proration of Oil Production

The historic crash in oil prices due to COVID-19-depressed demand and a growing supply glut pushed a pair of Texas shale drillers to ask state regulators to do something they haven’t done in nearly 50 years: curtail oil production.

It’s a request that if granted by the Railroad Commission of Texas, could affect oil and gas contracts up and down the supply chain, from production leases and joint venture deals to marketing and pipeline agreements. Litigation over the ongoing viability of those contracts would be a given, according to Texas energy attorneys such as Winston & Strawn Partner Mike Blankenship.

“Think about the history of the Railroad Commission: the reason it came about was people were out there going nuts, and drilling reservoirs and messing everything up,” said Mike. “This is a way to keep things orderly.”

Read more of Mike’s comments about what attorneys must know about the push for Texas drilling cuts in this Law360 article here. 

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