Equinor Energy LP v. Lindale Pipeline LLC, No. 24-0425 (Tex.)

Beck Redden secured a complete victory for client Equinor Energy LP at the Texas Supreme Court, which reversed a roughly $26 million judgment entered after a Harris County jury trial in a contract dispute over water used for fracking operations. The case arose from a long-term agreement under which Lindale Pipeline LLC agreed to operate a freshwater pipeline system and to serve as the “sole and exclusive water provider and pumper on the pipeline” for Equinor’s predecessor’s drilling program.

After Equinor acquired its predecessor, it began purchasing water from other suppliers using flexible hose systems rather than the pipeline Lindale was operating. Lindale claimed this conduct violated the contract and obtained a jury verdict exceeding $26 million in alleged lost profits and related damages, which the court of appeals affirmed. The district court found the exclusivity provision to be ambiguous and submitted its meaning to the jury, which sided with Lindale.

The Texas Supreme Court held that the contract’s exclusivity language is unambiguous and, as a matter of law, applies only to water pumping operations “on the pipeline,” not to all water supplied to Equinor’s wells from any source. Because the wells themselves lay outside the scope of the exclusivity clause, the Court concluded Equinor did not breach the agreement by purchasing water from other providers and rendered judgment that Lindale take nothing. In doing so, the Court emphasized that Texas courts will enforce the words the parties chose and will not “blue pencil” broader obligations or rescue a party from a deal it now considers unfavorable.

This result underscores Beck Redden’s strength in high-stakes contract disputes and appellate advocacy, particularly in cases turning on careful interpretation of sophisticated commercial agreements. Equinor was represented by Joshua S. Smith, John S. Adcock, Fields Alexander, Jacqueline M. Furlow, and Joel T. Towner of Beck Redden LLP.