The Lenape Resources Corporation D/b/a Pomfret Production Company, Inc., and D/b/a Enercorp Resources, Inc., Tesoro…

Summary

The Texas Supreme Court held that the Uniform Commercial Code §2.306 does not apply to the take‑or‑pay gas purchase agreement, affirmed that the price‑escalation provision in the agreement is ambiguous and that the parties intended a double‑factor escalation, and affirmed that Tennessee must purchase its proportionate share of gas from unitized acreage. The Court reversed the appellate court’s application of §2.306 and remanded for compliance with the trial court’s judgment on escrow and fees.