Passive-Voice Habendum Clauses and Lessee Production in Texas Oil-and-Gas Law:
Commentary on Cromwell v. Anadarko E&P Onshore, LLC

I. Introduction

The Supreme Court of Texas’s decision in David W. Cromwell v. Anadarko E&P Onshore, LLC, No. 23‑0927 (Tex. May 23, 2025), resolves an important question in Texas oil-and-gas law: when a habendum clause in an oil-and-gas lease is written in the passive voice—stating that the lease continues “as long as oil or gas is produced” from the land—must the lessee personally cause that production to keep the lease alive?

The Court’s answer is a clear no. Absent express language to the contrary, any production in commercial paying quantities from the leased premises (or pooled lands, if applicable) is sufficient to maintain the lease; the lessee’s personal participation in production is not required. In reaching this result, the Court:

Applies strict textualism to oil-and-gas lease interpretation, refusing to “blue-pencil” or imply terms the parties did not write.
Reaffirms the strong Texas presumption against forfeitures of mineral interests.
Disapproves a line of authority—Mattison, Hughes, and especially the El Paso Court of Appeals’ Cimarex decision—that had effectively read an unstated lessee‑production requirement into passive‑voice habendum clauses.

The case arises from a dispute between:

David W. Cromwell, a non-operating working interest owner (lessee) under two 2009 leases; and
Anadarko E&P Onshore, LLC, a major operator and co-tenant that drilled and operated wells on the same Loving County acreage.

Although Anadarko continuously produced oil and gas in commercial paying quantities, it later acquired “top leases” from Cromwell’s lessors and asserted that Cromwell’s original leases had expired at the end of their primary terms because Cromwell did not himself cause production. The trial court and the El Paso Court of Appeals accepted that theory, heavily relying on the court of appeals’ own earlier decision in Cimarex Energy Co. v. Anadarko Petroleum Corp., 574 S.W.3d 73 (Tex. App.—El Paso 2019, pet. denied).

The Supreme Court reverses, holding that the plain language of the habendum clauses controls and that, given undisputed continuous production in paying quantities from the land, Cromwell’s leases never terminated. The Court remands for the trial court to address Cromwell’s remaining claims (including trespass to try title and other issues not resolved in this opinion).

II. Summary of the Opinion

A. Core Holding

The principal rule announced is:

A habendum clause drafted in the passive voice—e.g., “as long thereafter as oil, gas or other minerals are produced from said land” or “is produced in commercial paying quantities from the lands leased hereby”—does not impose a requirement that the lessee personally cause or conduct production in order to maintain the lease.

Consequently, where:

The habendum clause does not specify the actor (e.g., does not say “by lessee”), and
There is continuous production in commercial paying quantities from the leased land (or pooled lands, as applicable),

the lease remains in force into and during the secondary term, regardless of whether the named lessee drills or operates the wells.

B. Disapproval of Contrary Authorities

The Court expressly disapproves, to the extent inconsistent with its holding:

Mattison v. Trotti, 262 F.2d 339 (5th Cir. 1959) (an Erie guess by the Fifth Circuit that a passive‑voice habendum clause inherently requires production “by the lessee” because drilling and production are supposedly the “prime consideration” of the lease).
Hughes v. Cantwell, 540 S.W.2d 742 (Tex. Civ. App.—El Paso 1976, writ ref’d n.r.e.).
Cimarex Energy Co. v. Anadarko Petroleum Corp., 574 S.W.3d 73 (Tex. App.—El Paso 2019, pet. denied).

Those cases had read into the lease a lessee‑production requirement that is not contained in the text, often based on broader statements of “purpose” or exclusivity in the granting clause.

C. Treatment of the Tantalo Lease’s Paragraph 16

The Court confronts a more complicated lease provision: Paragraph 16 of the Tantalo Lease, which—at first glance—appears to require production “by the Lessee” as a condition of extending the lease beyond the primary term. Paragraph 16 is expressly “[s]ubject to Paragraphs 6 and 11,” both of which are themselves drafted in the passive voice and layered with cross‑references.

The Court finds Paragraph 16 ambiguous and, applying the strong presumption against forfeiture of mineral interests, construes it as creating a covenant rather than a special limitation that would automatically terminate Cromwell’s lease. Thus, even if Cromwell breached those obligations, the lessor’s remedy would be damages or conditional cancellation—not automatic expiration of the lease.

D. Preservation of Cromwell’s “Passive Voice” Argument

Anadarko argued that Cromwell forfeited his passive-voice theory by not explicitly asking the court of appeals to overrule Cimarex. The Supreme Court rejects that procedural obstacle:

Under Texas Rule of Appellate Procedure 38.1(f), a stated issue on appeal “covers every subsidiary question that is fairly included.”
Parties may construct new arguments in support of issues properly raised below. See Li v. Pemberton Park Community Ass’n, 631 S.W.3d 701 (Tex. 2021) (per curiam).
Cromwell consistently contested the notion that unwritten conditions (such as a personal-production requirement) could cause automatic lease termination, a position “directly contrary to Cimarex,” as Anadarko itself noted in the court of appeals.

Thus, Cromwell preserved the legal theory the Supreme Court adopts.

III. Detailed Analysis

A. Factual and Procedural Background in Context

Understanding the opinion’s significance requires attention to its factual structure, which is typical of modern Permian Basin disputes:

Working-interest co-tenancy. Anadarko and Cromwell both held working interests in the same acreage in Loving County. Anadarko was the operator; Cromwell was a non-operating working-interest owner.
Pre-existing wells and continuous production. Before Cromwell obtained his interests, Anadarko had drilled and completed three wells—Hughes & Talbot 75‑23‑1, 75‑25‑1, and 75‑26‑1—and later drilled more. All parties agreed that production in commercial paying quantities continuously occurred on the land.
Cromwell’s two leases. Cromwell entered:
- the Ferrer Lease (3‑year primary term) on February 2009; and
- the Tantalo Trust Lease (5‑year primary term) on March 2009.
Both were “paid-up” leases: Cromwell owed no drilling or delay rentals during the primary term.
Participation efforts and joint interest billings. From 2009 to 2018, Cromwell repeatedly sought to participate in Anadarko’s operations through a joint operating agreement (JOA). Anadarko never provided a JOA but:
- treated Cromwell as a working-interest owner in its billing system,
- sent him monthly joint interest billings, and
- accepted his payments of operating costs, paying him revenue when his share was in the black.
Apparent recognition, then “discovery” of alleged lease termination. Even after the Ferrer and Tantalo primary terms ended (2012 and 2014), Anadarko:
- continued billing Cromwell as a working-interest owner, and
- kept internal records indicating his leases were “held by production.”
In 2016 Anadarko internally concluded that Cromwell’s leases had “expired” because he had not entered a JOA or personally caused production. It did not tell Cromwell until after it had acquired top leases from his lessors in 2017.
Litigation and prior appellate rulings. Cromwell sued, seeking:
- declaratory relief that his leases remained in effect,
- trespass to try title relief, and
- other claims (some partnership-based claims, which were rejected and not challenged in the Supreme Court).
The trial court granted Anadarko’s summary judgment, holding the leases had terminated. The El Paso Court of Appeals affirmed, applying Cimarex to conclude that Cromwell’s failure to “take some action to cause production” doomed his leases.

The central legal question at the Supreme Court, therefore, was whether passive-voice habendum clauses require lessee-caused production or whether any production in paying quantities from the land suffices.

B. Precedents and Authorities Cited

1. Contract Interpretation and Textualism

The Court reiterates that an oil-and-gas lease is “just another type of contract,” so general contract-interpretation principles apply. Key authorities include:

Endeavor Energy Res., L.P. v. Energen Res. Corp., 615 S.W.3d 144, 147–48 (Tex. 2020) – Oil-and-gas leases are construed under ordinary contract law; courts seek the parties’ intent as expressed in the instrument’s plain language.
Anadarko Petroleum Corp. v. Thompson, 94 S.W.3d 550, 554 (Tex. 2002) – Lease construction is reviewed de novo; the habendum clause defines the mineral estate’s duration.
URI, Inc. v. Kleberg County, 543 S.W.3d 755, 764 (Tex. 2018) – Courts must determine what an ordinary person would understand the contractual words to mean under the circumstances.
First Bank v. Brumitt, 519 S.W.3d 95, 110 (Tex. 2017) – Surrounding circumstances cannot be used to make the contract “say what it unambiguously does not say.” The Cromwell Court uses this language to criticize decisions that “rewrote” passive-voice habendum clauses to require lessee production.
U.S. Polyco, Inc. v. Texas Central Business Lines Corp., 681 S.W.3d 383, 390 (Tex. 2023) (per curiam) – Courts cannot elevate broad “purpose” language over specific operative clauses when the contract does not say that everything is “subject to” that purpose.
Tenneco Inc. v. Enterprise Prods. Co., 925 S.W.2d 640, 646 (Tex. 1996) – Courts must not rewrite agreements to insert provisions the parties could have included or to create restraints they did not bargain for.
American Midstream (Ala. Intrastate), LLC v. Rainbow Energy Mktg. Corp., ___ S.W.3d ___ (Tex. 2025) – Cited for the proposition that courts must not “blue-pencil” new words into the parties’ contract.

Collectively, these cases support the Court’s refusal to supplement the passive-voice language “is produced” with the phrase “by the lessee.”

2. Habendum Clauses, Special Limitations, and Forfeiture

On the nature and operation of habendum clauses and termination:

Anadarko Petroleum Corp. v. Thompson, 94 S.W.3d at 554 – The habendum clause defines duration and may impose a special limitation causing automatic termination upon specified events.
Endeavor Energy Res., L.P. v. Discovery Operating, Inc., 554 S.W.3d 586, 597, 606 (Tex. 2018) – Distinguishes primary and secondary terms and notes that a special limitation provides for automatic termination upon occurrence of a stipulated event.
BP Am. Prod. Co. v. Red Deer Res., LLC, 526 S.W.3d 389, 394 (Tex. 2017) – Courts determine when a lease terminates by ascertaining intent from the lease as a whole.
Fox v. Thoreson, 398 S.W.2d 88, 92 (Tex. 1966) & Rogers v. Ricane Enters., Inc., 772 S.W.2d 76, 79 (Tex. 1989) – All doubts are resolved against finding a condition that results in termination; special limitations must be expressed in language that is “clear, precise, and unequivocal.”
Endeavor Energy v. Energen, 615 S.W.3d at 149 – Where ambiguity remains, courts may resort to default rules of construction, including anti-forfeiture principles.
A.W. Walker, Jr., The Nature of the Property Interests Created by an Oil and Gas Lease in Texas, 8 Tex. L. Rev. 483, 512 (1930) – Quoted for the classic statement that the parties intend the lessee’s estate to terminate automatically if oil or gas is not being produced at the end of the primary term, or if production later ceases.

The Court uses these authorities to emphasize:

A habendum clause plainly stating that the lease continues “as long as oil or gas is produced” creates an automatic-termination mechanism only if production itself ceases.
It does not automatically terminate merely because the identity of the producer is not the named lessee—unless the lease clearly says so.
Ambiguous provisions that arguably add lessee‑specific conditions (such as Paragraph 16 of the Tantalo Lease) are construed as covenants, not special limitations, to avoid forfeiture absent “clear, precise, and unequivocal” language to the contrary.

3. Co-tenancy and Remedies Between Co-tenants

Because Cromwell and Anadarko were working-interest co-tenants, the Court relies on classic co-tenancy principles:

Cox v. Davison, 397 S.W.2d 200, 201 (Tex. 1965) – A producing co-tenant must account to non-producing co-tenants, and a non-producing co-tenant must bear its share of the reasonable and necessary costs of production and marketing.

This reinforces the Court’s observation that Anadarko is not left remediless if Cromwell fails to shoulder his share of expenses; Anadarko can bring an accounting action. There is no need to manufacture a lease-termination remedy not found in the text.

4. Appellate Preservation and Forfeiture

On whether Cromwell’s passive-voice argument was preserved:

Tex. R. App. P. 38.1(f) – An issue statement “cover[s] every subsidiary question that is fairly included.”
Perry v. Cohen, 272 S.W.3d 585, 587 (Tex. 2008) (per curiam) – Supports a practical, non-hypertechnical approach to issue preservation.
Li v. Pemberton Park Cmty. Ass’n, 631 S.W.3d 701, 704 (Tex. 2021) (per curiam) – Parties may construct new arguments at higher appellate levels so long as they support issues that were properly preserved.
Bertucci v. Watkins, 709 S.W.3d 534, 541 n.5 (Tex. 2025) & United States v. Olano, 507 U.S. 725, 733 (1993) – Defining “forfeiture” (failure to timely assert a right) versus “waiver” (intentional relinquishment).

These authorities allow the Court to reach the merits of Cromwell’s passive-voice argument despite Anadarko’s preservation objection.

5. The “Vital Consideration” of an Oil-and-Gas Lease

A key doctrinal correction comes from:

Texas Co. v. Davis, 254 S.W. 304, 306 (Tex. 1923) – The “vital consideration” of an oil-and-gas lease is not drilling per se, but royalties on mineral production.

The Court contrasts this with Mattison, which had assumed that drilling and production “by the lessee” were the “prime consideration,” a premise now expressly rejected. This doctrinal realignment undercuts the justification that courts had used to impose unstated lessee-production requirements.

C. The Court’s Legal Reasoning

1. The Habendum Clauses: Plain Text and Passive Voice

The habendum clauses at issue are straightforward:

Ferrer Lease: continues “as long thereafter as oil, gas or other minerals are produced from said land, or land with which said land is pooled hereunder, or as long as this lease is continued in effect as otherwise herein provided.”
Tantalo Lease: continues “as long thereafter as oil, gas, liquid hydrocarbons or their constituent products, or any of them, is produced in commercial paying quantities from the lands leased hereby.”

Both are written entirely in the passive voice. Neither mentions who must produce. The Court notes that many Texas leases do specify “by the lessee” in their habendum clauses, citing examples like Ridge Oil Co. v. Guinn Invs., Inc., 148 S.W.3d 143 (Tex. 2004), Fleming v. Ashcroft, 175 S.W.2d 401 (Tex. 1943), and W.T. Waggoner Estate v. Sigler Oil Co., 19 S.W.2d 27 (Tex. 1929).

From this, the Court draws two textual conclusions:

When parties intend to require production “by the lessee”, they know how to say so explicitly.
The absence of such language in Cromwell’s leases is not an accident to be corrected by judicial implication; it reflects the parties’ choice.

On that basis, the Court refuses to “squint to discover requirements that the parties themselves chose not to write into the memorialization of their bargain.” Because it is “undisputed that production in commercial paying quantities continuously occurred on the leased land,” the habendum conditions for continuation were met, and the leases did not terminate.

2. Rejection of “Purpose” Clauses as a Basis for Implied Termination Conditions

The granting clauses in both leases describe the leases’ “purpose” as enabling Cromwell to explore and drill for oil and gas. The El Paso Court of Appeals (following Hughes and Cimarex) treated that purpose language as “indicative” of an intent that Cromwell himself must produce to keep the leases alive.

The Supreme Court firmly rejects this approach:

Courts are not authorized to ensure that every provision “comports with some grander theme or purpose,” especially when the contract does not say that other terms are “subject to” that purpose.
The habendum clause is the specific provision that “contains the key language that determines the duration of the mineral estates.”
Using purpose clauses to override clear habendum text improperly inverts the contract’s structure and contradicts textualist principles articulated in U.S. Polyco and Brumitt.

3. Paragraph 16 of the Tantalo Lease: Ambiguity and Anti-Forfeiture

Paragraph 16 of the Tantalo Lease is the opinion’s most technically intricate point. It provides that rights “shall be extended beyond the primary term” only if certain conditions are met, including that the “Lessee has obtained production in commercial paying quantities prior to the expiration of said primary term,” and is “subject to Paragraphs 6 and 11.”

Key features:

It uses “Lessee” language and appears to condition extension beyond the primary term on the Lessee’s actions.
But it is expressly “[s]ubject to Paragraphs 6 and 11,” which themselves:
- are drafted in passive voice,
- fail to specify who must act, and
- are in turn “[s]ubject to” other provisions, including Paragraph 16.

This web of cross‑references produces genuine textual uncertainty about whether:

Paragraph 16 imposes a special limitation (automatic termination absent lessee‑obtained production), or
instead creates a covenant or set of covenants, whose breach yields non‑automatic remedies like damages or conditional cancellation.

Because the provision is not “so clear, precise, and unequivocal” that it can be given no other meaning than automatic termination, the Court:

Applies the default anti‑forfeiture rule; and
Construes Paragraph 16 as a covenant—enforceable by damages or equitable relief, but not by automatic lease termination.

This preserves Cromwell’s interest and harmonizes the deeply anti-forfeiture jurisprudence in Texas oil-and-gas law with the contract’s ambiguous text.

4. Co-tenancy Remedies as an Alternative to Termination

The Court emphasizes that Anadarko is not without recourse if Cromwell fails to perform economically:

As co-tenants, Anadarko can demand that Cromwell pay his share of reasonable and necessary costs, and
If he does not, Anadarko may sue for an accounting under co-tenancy principles recognized in Cox v. Davison.

Critically, the Court notes that using forfeiture of Cromwell’s lease as a back‑door solution to an expense‑sharing dispute is inappropriate where the lease itself does not clearly provide for termination in those circumstances. What remedies are available is driven by existing tenancy law, not by invented conditions in the habendum clause.

5. Disapproval of the Mattison–Hughes–Cimarex Line

The Court’s doctrinal cleanup directly affects a set of decisions that had been influential in some lower courts:

Mattison v. Trotti, 262 F.2d 339 (5th Cir. 1959) – A federal Erie guess that a passive‑voice habendum clause implies a duty that the lessee personally drill and produce as the lease’s “prime consideration.”
Hughes v. Cantwell, 540 S.W.2d 742 (Tex. Civ. App.—El Paso 1976, writ ref’d n.r.e.) – Relied on Mattison to hold that a passive‑voice habendum required the lessee to perform “directly or constructively.”
Cimarex Energy Co. v. Anadarko Petroleum Corp., 574 S.W.3d 73 (Tex. App.—El Paso 2019, pet. denied) – Extended Hughes even further, requiring personal lessee production to maintain the lease even when the operator thwarted the non‑operator’s participation.

The Supreme Court’s criticisms:

Each of these cases departs from the plain language of the leases and instead “make[s] the language say what it unambiguously does not say” (Brumitt).
Their reasoning rests on the erroneous idea that drilling by the lessee is the “prime” or “vital” consideration, which Texas Co. v. Davis had already rejected in favor of royalties as the vital consideration.
They improperly deploy “purpose” and “exclusivity” language in granting clauses to undermine the habendum clauses’ general, passive-voice formulations.

By disapproving these cases, the Court provides clear guidance to both state and federal courts applying Texas law: do not imply a lessee-production requirement from passive-voice habendum language.

D. Impact and Implications

1. Drafting and Interpretation of Habendum Clauses

For oil-and-gas professionals and drafters, the message is explicit:

If a lessor or lessee intends that only production “by the lessee” will maintain the lease, that must be clearly and expressly stated in the habendum clause (or another provision that unambiguously operates as a special limitation).
Generic, passive-voice habendum clauses (“as long as oil or gas is produced”) will be interpreted to require only that:
- there be continuous production in commercial paying quantities from the leased land (or pooled unit, where stated), and
- it does not matter which co-tenant or third party operates the wells.

The decision thereby:

Stabilizes title under countless existing leases that use passive-voice habendum clauses.
Reduces the risk that operators or top lessees can later argue that non-operating lessees “lost” their leases solely because they did not drill wells themselves.

2. Effect on Non-Operating Working-Interest Owners and JOAs

Non-operating lessees—or “non-ops”—benefit significantly:

They are not required to drill their own wells or force a JOA merely to avoid automatic lease forfeiture under a passive-voice habendum.
When an operator unilaterally develops the acreage, their leases are still preserved by the operator’s production, absent clear contrary language.

Operators, in turn, must:

Recognize that denying a non-op a JOA does not, by itself, extinguish that non-op’s underlying lease based on a passive-voice habendum clause.
Use co-tenancy and accounting remedies—not unilateral “termination” theories—to address disputes over expenses or participation.

Future JOAs and participation structures may expressly address these issues, but they cannot retroactively rewrite lease habendum clauses approved by the parties.

3. Top Leases and Title Risk

The case has substantial implications for top leases:

Top leases are granted on the assumption that an existing lease will expire; they are often taken “subject to” the prior lease.
If that expiration assumption is wrong, the top lease may be ineffectual—or the top lessee may be exposed to trespass or title claims.

Here, Anadarko, acting as both operator and top lessee, acquired top leases on the belief (formed years into continuing billing practices) that Cromwell’s leases had expired. The Supreme Court’s ruling strongly implies those top leases are ineffective as to Cromwell’s interest, though that specific title question is left for remand and further proceedings.

For practitioners:

Acquiring top leases against passive-voice habendum clauses now carries clearer risk: unless production stopped, the prior lease likely persisted.
Title examiners must reevaluate any opinions that treated non-ops’ passive-voice leases as expired solely due to lack of personal production, especially in jurisdictions that had followed Cimarex.

4. Federal Courts and Erie Predictions

Because Mattison v. Trotti was a federal Erie guess, the Supreme Court’s decision effectively corrects that guess. Federal courts sitting in diversity and applying Texas law:

Are now bound to follow Cromwell’s textual approach to passive-voice habendum clauses.
Cannot rely on Mattison, Hughes, or Cimarex to infer lessee-specific production duties where the lease is silent.

5. Broader Jurisprudential Themes: Textualism and Anti-Forfeiture

The opinion reinforces two key themes of modern Texas contract and property law:

Textualism. The Court insists on enforcing the contract the parties signed, not the contract a court might prefer. Substituting “by the lessee” into a passive-voice clause is condemned as judicial blue‑penciling.
Anti-forfeiture in mineral cases. Where language is ambiguous about whether it operates as a special limitation (automatic termination) or as a covenant (breach with non-automatic remedies), courts must err against forfeiture. The Cromwell Court’s handling of Paragraph 16 of the Tantalo Lease is textbook application of this principle.

The closing admonition—quoting Cosgrove v. Cade, 468 S.W.3d 32, 40 (Tex. 2015)—underscores the Court’s concern with “legal certainty and predictability” in property ownership, favoring “bright lines and sharp corners” over policy-driven improvisation.

IV. Complex Concepts Simplified

For readers less familiar with oil-and-gas law, the following explanations may help:

Habendum Clause

The part of a lease that defines how long the lease lasts. In oil-and-gas leases, it typically states a primary term (fixed number of years) and a secondary term (often “as long thereafter as oil or gas is produced”).

Primary Term vs. Secondary Term

Primary term: A fixed period (e.g., 3 or 5 years) during which the lessee can maintain the lease even without production, often by paying delay rentals or, as here, under a paid-up structure.
Secondary term: Indefinite continuation, conditioned on meeting certain requirements (usually continuous production in paying quantities).

Passive Voice in Contracts

A sentence is in the passive voice when it focuses on the action and its object, not on who performs it. Example: “Oil is produced from the land” (passive) versus “Lessee produces oil from the land” (active). In leases, passive-voice habendum clauses do not specify who must produce.

Working Interest

The interest in an oil-and-gas lease that bears the costs of drilling and operations and receives a share of production. A working-interest owner is entitled to a proportionate share of revenues, minus their share of operating expenses.

Co-tenant / Co-tenancy

When two or more parties jointly own undivided interests in the same mineral estate or working interest. Each co-tenant can develop the minerals but must account to the others, sharing revenues and costs according to their interest.

Joint Operating Agreement (JOA)

A contract among working-interest owners in a drilling or producing area specifying how operations will be conducted, who the operator is, how costs and revenues are allocated, and how decisions are made.

Joint Interest Billing (JIB)

Monthly statements sent by the operator to other working-interest owners, itemizing each owner’s share of revenues and expenses for particular wells or units.

Top Lease

A lease granted on minerals already covered by an existing lease, to become effective if and when the existing lease expires or terminates. Top leases are often speculative and can be invalid if the underlying lease never actually ends.

Special Limitation vs. Covenant

Special limitation: A term in a grant or lease providing that the interest automatically terminates when a stated condition fails. No further action (like a lawsuit) is required to end the estate.
Covenant: A promise whose breach gives rise to remedies (damages, or sometimes equitable cancellation), but the underlying estate does not automatically terminate. Courts are reluctant to construe ambiguous language as a special limitation because of the forfeiture it entails.

Forfeiture

The loss of a property interest because a condition is not met. In oil-and-gas law, forfeiture often refers to automatic termination of a lease, which Texas courts disfavor absent very clear language.

Production in Commercial Paying Quantities

Production that generates enough revenue, over time, to cover operating expenses and provide a profit to the lessee, considering a reasonably prudent operator standard. Continuous production in paying quantities usually satisfies the habendum clause’s requirements.

Trespass to Try Title

A Texas cause of action used to resolve competing claims to real property interests, including mineral interests and leasehold rights. Cromwell used it to challenge Anadarko’s assertion that only Anadarko (as top lessee) held valid leasehold title.

V. Conclusion and Key Takeaways

The Supreme Court of Texas’s decision in Cromwell v. Anadarko E&P Onshore, LLC sets an important and clarifying precedent for Texas oil-and-gas law:

Passive-voice habendum clauses do not require lessee-specific production. If a lease states that it continues “as long as oil or gas is produced” and does not specify “by the lessee,” any production in commercial paying quantities from the leased land (or pooled lands, as applicable) suffices to maintain the lease.
Courts will not “blue-pencil” missing words into leases. Judges may not rewrite contracts to include terms (e.g., “by the lessee”) that the parties could have included but did not.
Purpose language cannot override clear habendum text. Broad recitals of purpose (e.g., to drill and produce) do not create implied termination conditions not found in the habendum clause.
Ambiguous extension clauses are construed as covenants, not special limitations. Where provisions like Paragraph 16 of the Tantalo Lease are ambiguous, anti-forfeiture principles require courts to treat them as covenants, preserving the lease unless clear language mandates automatic termination.
Co-tenancy provides remedies without forfeiture. Operators like Anadarko must use accounting and co-tenancy remedies for expense disputes rather than attempting to extinguish co-tenants’ leases based on implied conditions.
Key contrary cases are disapproved. Mattison, Hughes, and Cimarex, to the extent they inferred lessee-specific production duties from passive-voice habendum clauses, are no longer reliable guides to Texas law.
Drafting and title practice must adapt. Leases and top leases must be drafted and evaluated with this textual rule in mind. Claims that non-operating lessees “lost” their leases for failing to drill under passive-voice habendum clauses will be difficult to sustain going forward.

In sum, Cromwell strengthens textual certainty, protects lessees from unbargained-for forfeitures, and provides clearer guidance to courts, operators, and landowners alike. It reinforces that, in Texas, the written word of the lease—especially the habendum clause—governs, and courts will not reshape it to advance unexpressed purposes or create unexpected forfeitures of valuable mineral interests.

Passive-Voice Habendum Clauses and Lessee Production in Texas Oil-and-Gas Law: Commentary on Cromwell v. Anadarko E&P Onshore, LLC