Locke Lord Partner Chris Verducci and Associate Deanna Willson (both of Houston) represented Evolution Petroleum Corporation and several of its subsidiaries in a settlement agreement regarding litigation with Denbury Onshore, LLC, a subsidiary of Denbury Resources Inc. Evolution will receive a $27.5 million cash payment and other consideration pursuant to the settlement agreement. Among such other consideration, Denbury conveyed to Evolution a working interest in the Mengel Upper Glen Rose Sand interval within the Delhi Unit, proportionate to Evolution's 23.9% working interest in the primary Holt-Bryant zones in the Delhi Unit. The settlement further provides Evolution access to certain geological, geophysical and technical information regarding the Delhi Field for its internal analysis and reserves report. The effective resolution of this litigation allows the companies to continue working on the successful development of Louisiana’s Delhi Field, including through CO2 tertiary recovery operations.
The settlement resolves long-running contract disputes over operations in the Delhi Field, including contractual issues related to Evolution’s ownership of a CO2 recycle facility on the property and terms related to long-term CO2 pipeline transportation. According to the Evolution press release Bob Herlin, Executive Chairman of Evolution, said: "This settlement closes a long-running contract dispute and better defines and aligns the rights and obligations of both parties. It removes the uncertainty related to this litigation and clarifies the previously undefined CO2 transportation costs beginning in 2020. We believe our shareholders are well-served by this agreement."
Posted July 18, 2016