Cautious about Collaboration: Antitrust Scrutiny in Oil and Gas Exploration

I. Introduction

Oil and gas exploration in the continental United States boomed in the 2000's and into 2010's through the revolutionary use of horizontal drilling and hydraulic fracturing of shale and other rock formations. Unlike traditional vertical wells, which effectively operated to extract oil and gas from a single geographic point (possibly at multiple depths), horizontal wells could run for miles across a geography, extracting mineral rights across a much larger area. The nature of the drilling, which necessitated the aggregation of large and contiguous tracts of oil and gas rights, intensified the need and desire to create partnerships or other forms of cooperation between oil and gas companies who might be trying to put together sufficient rights to drill in an area. Various cooperation forms had long been in use in the exploration business, including broad exploration and production joint ventures, areas of mutual interest, and farm-out contracts. In his