Louisiana Revised Statutes 31:122 – Lessee’s obligation to act as reasonably prudent operator
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Terms Used In Louisiana Revised Statutes 31:122
- Contract: A legal written agreement that becomes binding when signed.
- Fiduciary: A trustee, executor, or administrator.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
A mineral lessee is not under a fiduciary obligation to his lessor, but he is bound to perform the contract in good faith and to develop and operate the property leased as a reasonably prudent operator for the mutual benefit of himself and his lessor. Parties may stipulate what shall constitute reasonably prudent conduct on the part of the lessee.
Acts 1974, No. 50, §122, eff. Jan. 1, 1975.