700 P.2d 1023 (Okla.App. Div. 4 1983), 57398, Woods Petroleum Corp. v. Delhi Gas Pipeline Corp.

Docket Nº:57398.
Citation:700 P.2d 1023
Party Name:WOODS PETROLEUM CORPORATION, et al., Appellees, v. DELHI GAS PIPELINE CORPORATION, Appellant.
Case Date:April 19, 1983
Court:Court of Appeals of Oklahoma, Court of Civil Appeals of Oklahoma
 
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Page 1023

700 P.2d 1023 (Okla.App. Div. 4 1983)

WOODS PETROLEUM CORPORATION, et al., Appellees,

v.

DELHI GAS PIPELINE CORPORATION, Appellant.

No. 57398.

Court of Appeals of Oklahoma, Division No. 4.

April 19, 1983.

Rehearing Denied May 12, 1983.

Certiorari Granted to Review Attorney Fee Award Dec. 26, 1984.

Released for Publication by Order of the Court of Appeals June 3, 1985.

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Appeal from the District Court of Dewey County; Ray Dean Linder, trial judge.

Action for recovery of damages for mismeasurement of plaintiffs' gas by defendant pipeline company. Defendant appeals jury verdict for plaintiffs, grant of attorney

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fees and denial of motion for new trial on ground of newly discovered evidence.

Robert H. Gilliland, Jr., and Kenneth L. Buettner McAfee & Taft, P.C., Oklahoma City, for appellees.

Thomas T. Rogers and John M. Kyser, Lynch, Chappell, Allday & Alsup, Austin, Tex., for appellant.

STUBBLEFIELD, Judge.

This is an appeal in an action brought by plaintiff, Woods Petroleum Corporation, seeking damages from Delhi Gas Pipeline Company for their alleged taking of plaintiffs' gas without compensation. Plaintiff brought suit under pure negligence, res ipsa loquitur, conversion and breach of contract theories. The jury returned a verdict finding defendant negligent and giving recovery for the amount of gas estimated taken but not paid for ($858,022.40). The trial court awarded prejudgment interest and attorney fees to plaintiffs.

I

Plaintiff Woods Petroleum Corporation, hereinafter referred to as Woods, completed the O.M. Taylor 26-2, hereinafter referred to as Taylor # 2, in Dewey County, Oklahoma, in July of 1976. The Taylor # 2 was drilled to a depth of 9,575 feet and pierced two lenticular aspects of the Morrow formation. Both zones of the Morrow were perforated and production established as a gas well with some condensate production. The top zone of production was from the 9,401 to 9,406 foot depth; the lower zone from 9,434 to 9,448. Bottom pressure of the well was established at 4,500 pounds.

Defendant Delhi Gas Pipeline Corporation, hereinafter referred to as Delhi, had a contractual agreement to purchase the gas produced from the Taylor # 2. By the terms of this agreement Delhi was to provide and operate the metering equipment which measured the volume of gas Delhi took from the Taylor # 2.

The metering device Delhi installed on the Taylor # 2 consisted of a differential pressure flow meter. Such a device works by placing a restriction of a certain known size, known as an orifice plate, in a line of a certain known size, known as the meter run, and measuring the difference in pressure on either side of the orifice plate. Due to the physical fact that for a certain volume of gas to move through such a restriction a certain percentage of the pressure of the gas is translated into velocity, it becomes possible to determine precisely the volume of gas moving through the meter by measuring this pressure drop across the orifice plate. The critical factors in determining the flow are the size of the opening in the orifice plate, the pressure on the system and the temperature of the gas. Delhi's meter on the Taylor # 2 recorded the differential pressure, the system pressure and the gas temperature on a seven day rotating paper chart.

Delhi began taking gas from the Taylor # 2 on October 26, 1976. A notation on the paper chart, accompanied by the initials of Delhi's meterman, on this day reflected that a .75 inch orifice plate had been removed and a 1.25 inch orifice plate installed in the meter run. The Taylor # 2 operated along lines expected for a Morrow formation well in the area. It was noted, however, that the well's production was only about one-half of what had originally been expected.

On May 17, 1978, Woods pumper for the Taylor # 2 checked the well before noon, noting the wellhead pressure, the operation of the condensate separator/heater, the choke opening on the well, the production of condensate and the readings on Delhi's chart. On this date the pumper recorded a differential pressure of 10. The next day when the pumper checked the well he found all conditions identical to those of the day before except for the differential pressure which had jumped from 10 to 44. A note had also been made on the chart that the orifice plate had been pulled and replaced with another 1.25 inch orifice plate. This note was accompanied by the initials of Delhi's meterman. This change in the

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differential pressure indicated the gas production from the Taylor # 2 had increased from approximately 880 Mcf to approximately 1,600 Mcf of gas per day.

Shortly after this occurrence Woods...

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