Arlington school trustees voted to sue Chesapeake

Posted Tuesday, Nov. 12, 2013  comments  Print Reprints

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Joining a line of other governments and individuals in North Texas, the Arlington school board voted Thursday night to sue Chesapeake Exploration, saying the company has underpaid royalties for natural gas.

The suit also names Total E&P USA, a French energy company that acquired 25 percent of Chesapeake’s holdings in the Barnett Shale in 2010.

The district’s suit asserts that the companies took unauthorized and/or unreasonable deductions from royalties by selling gas to affiliates under the leases without district permission and “otherwise failed to comply with the leases.”

The companies have oil and gas leases that cover more than 1,000 acres owned by the school district involving 40 producing wells, according to the suit.

The district hopes to join the suit filed in August by the city of Arlington. The city is seeking to recover more than $1 million.

“AISD’s claims involve 22 of the same gas wells already at issue in the city’s lawsuit,” a district press release stated.

School district lawyers have not set a monetary figure they hope to recover.

Board President Bowie Hogg said that joining the city’s suit will save taxpayers time and money. But it will be up to a judge to decide whether the district can join the suit.

The school board’s vote to join the suit was unanimous. Trustee Gloria Peña was absent.

Arlington City Attorney Jay Doegey said the City Council will likely support a joint suit.

“As I understand what they may be doing, their leases are in a lot of the same places as ours, and the provisions in their agreements are similar,” Doegey said.

In October, the city of Fort Worth also sued the energy companies. Other suits have been filed by financier Ed Bass, Trinity Valley School and several Fort Worth landowners.

Gordon Pennoyer, director of external communications for Chesapeake, declined to comment Thursday. Total E&P did not respond to an email seeking comment.

Monica S. Nagy, 817-390-7792 Twitter:@MonicaNagyFWST

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