11th Court of Appeals will hear Kinder Morgan appeal of previous Armstrong decision Thursday
Four Scurry County taxing entities are challenging a Scurry County Appraisal Review Board (ARB) ruling that Kinder Morgan’s 2019 mineral interests in the county were undervalued.
Attorney Brent Lemon, who represents Scurry County, Snyder ISD, the Scurry County Hospital District and Western Texas College, filed the petition last week in 132nd Judicial District Court.
Named in the suit are the Scurry County Appraisal District, Kinder Morgan CO2 Co., LP, individually and as successor in interest to Kinder Morgan SACROC, LP, and Kinder Morgan Production Co., LLC, individually and as successor in interest to Kinder Morgan Production Co., LP.
No date has been set for the hearing, but the 11th Court of Appeals in Eastland will hear an appeal from Kinder Morgan to dismiss a 2018 case filed by the entities at 2 p.m. Thursday. Each side will be given 20 minutes to present arguments, the notice stated.
Kinder Morgan is appealing District Judge Ernie B. Armstrong’s ruling that its motion to dismiss the case was not filed in a timely manner.
The entities are seeking to have the district court order the reappraisal of Kinder Morgan’s mineral values from 2012-18 after the ARB denied the request in June 2018.
The case filed this month is asking for the reappraisal of 2019 mineral interests, but will not be part of Thursday’s proceedings.
As part of the 2019 lawsuit, Lemon asked for the appraisal district and Kinder Morgan to provide all data used to set the mineral values.
Those figures include gross oil production, net revenue interest, net oil production, starting gross oil price, escalation rate, oil price, gross income, operating expense details, severance taxes, net income, discount factor and discounted cash flow. He requested similar information in 2018.
Lemon is asking the court to order the reappraisal of 2019 mineral interest and to file the “correct and accurate appraised values of the mineral interest” for 2019, court costs and “further and other relief, whether at law or in equity, to which Plaintiffs show themselves justly entitled.”
Lemon’s services may be at no cost to the entities unless future settlements or judgments are reached in the matter. If that occurs, Lemon will receive 20 percent of any settlement or judgment. U.S. Consults, LLC, would also receive 20 percent of any settlement or judgment.
If the appeals court overturns Armstrong’s ruling, the taxing entities could be required to pay Kinder Morgan’s attorneys’ fees.