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Texas Supreme Court Clarifies RRC Jurisdiction

On April 28, 2017, the Texas Supreme Court delivered an opinion in Forest Oil Corp. v. El Rucio Land and Cattle Co., Inc., No. 14-0979 (Tex. 2017). One of the principal questions in the case concerned whether the Railroad Commission has exclusive or primary jurisdiction over claims of environmental contamination related to oil and natural gas development, thus precluding suits for damages and other judicial relief. The Texas Supreme Court found that the Railroad Commission does not have exclusive jurisdiction over common-law actions related to contamination, particularly where the plaintiff brings a breach of contract cause of action related to a surface use agreement. The Court cautioned, however, that “an operator can reduce or eliminate the landowner’s damages” “by seeking an RRC determination of contamination allegations and complying with RRC cleanup orders.”