Cull v. Canadian Superior Oil Ltd., [1972] S.C.R. 89 (1971)

Supreme Court of Canada

Cull v. Canadian Superior Oil Ltd., [1972] S.C.R. 89

Date: 1971-04-27

Ida Armilda Cull (Defendant) Appellant;

and

Canadian Superior Oil Ltd. (Plaintiff) Respondent.

1971: March 19; 1971: April 27.

Present: Abbott, Martland, Judson, Hall and Laskin JJ.

ON APPEAL FROM THE SUPREME COURT OF ALBERTA, APPELLATE DIVISION

Mines and minerals-Petroleum and natural gas lease-Right of lessee, having commenced to drill prior to expiration of primary term, to drill well to completion-Added provision for continuance if production obtained-Whether production must commence immediately upon completion of drilling operations.

The respondent lessee commenced drilling a well on certain leased lands before the expiration of the primary term of the lease and shortly after such expiration the well was completed. Although the well was then capable of producing oil, the flow was shut off because there was no equipment ready to treat and store the production. Some days later, following the erection and installation of facilities to treat and save the oil, the well was reopened and put into production. Thereafter, subject to the monthly quota allowable under the regulations of the Oil and Gas Conservation Board, there was continuous production and the royalties payable in connection therewith were re...

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