North Texas royalty buyers and investors are suing Chesapeake Energy Inc. (NYSE: CHK) claiming excessive fees and royalty underpayments, according to a July 1 press release.
The claims are related to Chesapeake's $588 million sale of Barnett Shale midstream gathering assets to Global Infrastructure Partners in 2009. The sale included an exclusive 20-year production commitment related to the company's midstream assets.
The lawsuit alleges that Chesapeake's sale was structured to charge unreasonable fees on royalties. In addition, the suit challenges the company's transportation fees and net royalty interest calculations.
The suit involves oil and gas leases covering more than 5,400 mineral acres and more than 750 producing gas wells in Tarrant, Johnson and Ellis counties, Texas. The lawsuit also includes more than 30 business entities and individuals, such as Fort Worth's Kimbell Art Foundation, the release said.
Burns Charest LLP, in Dallas, represents the plaintiffs. In late 2015, the firm secured a favorable, confidential settlement for members of the Bass family in Fort Worth as part of a separate lawsuit against Chesapeake over unpaid oil and gas royalties in North Texas, the release said.
The case is Addax Mineral Funds, et al.v. Chesapeake Operating LLC, et al., No. DC-16-07867, in the 95th District Court in Dallas.
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