Southland Royalty Company, Petitioners. v. Pan American Petroleum Corporation, Respondents

Summary

The Texas Supreme Court held that the phrase "other minerals" in the lease includes gas and that the clause "used off the premises" does not mean "sold for use off the premises," so the lessee must pay a one‑eighth royalty on gas sold and only the flat‑rate royalties when the lessee himself uses the gas off the premises. The Court reversed the lower courts and remanded for further proceedings. The dissenting opinions argue that "other minerals" should not include gas and that the flat‑rate royalty applies to gas sold.