A Solution to the Problem of Damage Sustained Through Offset Drainage

AN OIL and gas mining lease contract, as entered A into by and between 'the lessor and the lessee, contains certain express covenants stipulating, in part at least, the exact performance thereof; it also contains certain implied covenants, among which may be included that of protection of the leased premises against drainage by the drilling of necessary offset wells. In the drilling for, and production of, oil and gas, however, it not infrequently happens that the lessee, acting in good faith, does not deem it prudent to, drill a test thereon even though the location for such test is offset by a producing well on an adjoining lease. Such conclusion, on the part of the lessee, is generally construed by the lessor as constituting a breach of the implied covenant mentioned above, and he may take proper action to secure satisfaction therefor. The action against the lessee is generally for cancellation or relinquishment of the lease, together with, or apart from, claims for damages allegedly sustained through failure to properly protect against drainage of the leased premises.