Estate of Algerine Allen Smith, Deceased, James Allen Smith, Executor - Page 19

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          that it owed Exxon nothing.12  Petitioner cannot now switch hats            
          and attempt to show how meritorious Exxon's claims actually were.           
          Instead, the settlement agreement of February 10, 1992, serves as           
          both Exxon's and petitioner's assessment of the value of the now            
          compromised claims.                                                         
               Petitioner further alleges that certain provisions of the              
          unit and unit operating agreements provided Exxon with an                   
          enforceable lien against the Allen parties' interests in the HFU            
          and entitled Exxon to restitution of the overcharges.  Cf.                  
          Propstra v. United States, 680 F.2d at 1253-1254.  We disagree.             
          The relevant provisions petitioner refers to address the                    
          relationship between Exxon, as operator of the HFU, and the other           
          working interest owners in the HFU.  Thus, neither provision is             
          applicable to the Allen parties who, in contrast, were royalty              
          interest owners in the HFU.  In addition, we note that no                   
          provision of the unit operating agreement is applicable to                  
          royalty interest owners, as the agreement only addresses the                
          relationship between Exxon and the other working interest owners            
          in the HFU.                                                                 
               We also reject petitioner's attempt to find a lien within              
          the Allen parties' oil and gas leases.  The relevant provision in           
          the leases stated, in pertinent part:                                       

               12For instance, shortly after filing its Federal estate tax            
          return in July 1991, petitioner filed a document with the special           
          master in the Jarvis Christian litigation objecting to Exxon's              
          damage calculations.                                                        




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