In MIECO LLC v. Pioneer Natural Resources USA, Inc.,1 Pioneer and MIECO were parties to an NAESB contract for Pioneer to supply MIECO 20,000 MMBtu of natural gas daily on a firm basis. MIECO claimed breach of contract when Pioneer failed to deliver the agreed amount of natural gas from February 14 to February 19, 2021, during Winter Storm Uri, arguing that the storm was not a force majeure event since Pioneer could have purchased replacement gas from the spot market.
The Texas Northern District Court, in denying MIECO’s motion for summary judgment, held that force majeure provisions in the contract were unambiguous and that Pioneer’s non-delivery from February 14 to February 19, 2021, caused by low temperatures that affected an entire geographic region and caused freezing or failure of wells or lines of pipe, constituted force majeure under the contract.
On appeal, the Fifth Circuit in MIECO, L.L.C., v. Pioneer Natural Resources USA, Inc.2 held that the district court correctly interpreted force majeure in that it did not require Pioneer to show that the storm rendered its performance under the contract literally impossible. However, the appellate court remanded the case for fact-finding on whether (1) Winter Storm Uri prevented Pioneer’s performance and (2) Pioneer exercised due diligence. The district court’s recent opinion on remand closes the loop.
On October 15, 2025, Judge Jane J. Boyle issued a memorandum opinion3 in favor of Pioneer, holding that the producer did not breach its firm gas delivery contract with MIECO during Winter Storm Uri. The court, in its opinion:
- Reaffirmed that Winter Storm Uri qualified as a force majeure event under the contract because it was a weather-related occurrence affecting an entire geographic region, which caused well and pipeline failures.4 The court found that Pioneer’s performance was “prevented” within the meaning of the contract because the storm rendered full performance impracticable, and that a finding of impossibility was not necessary.
- Found that Pioneer exercised due diligence by winterizing equipment, reallocating firm volumes, and working to restore production as soon as conditions allowed.5 The court also credited expert testimony that, under industry customs and practice, a producer who has lost its gas supply due to force majeure is not expected to purchase replacement gas on the spot market.6 This custom exists to avoid further driving up spot market prices to allow producers to focus on restoring supply, which benefits the market as a whole.
- Rejected MIECO’s argument that Pioneer’s failure to purchase replacement gas was merely an economic hardship rather than a force majeure event.7 The court held that the contract’s plain language and industry practices supported Pioneer’s position. The court also found that MIECO had, in other contracts, negotiated for special language requiring sellers to procure replacement gas, but had not done so in contracts with Pioneer.8
The MIECO decision adds to a growing line of cases interpreting force majeure provisions under the NAESB. Together with opinions such as LNG Americas v. Chevron Natural Gas9 and Arkansas Oklahoma Gas Corp. v. BP Energy,10 the ruling underscores several consistent themes:
- Severe regional weather events can qualify as a force majeure event under the NAESB.
- Courts interpret force majeure using an impracticability standard rather than requiring impossibility.
- A producer invoking force majeure is not required to procure replacement gas or draw from storage at the delivery point when disruption arises from loss of its upstream supply if not specifically required by the contract.
- Industry customs and the parties’ course of dealing are relevant to interpreting force majeure obligations, but the contract’s language is paramount.
- Precise contract drafting is vital. If buyers want sellers to procure replacement gas during force majeure events, they must include explicit language.
Client Alert 2025-277
- MIECO LLC v. Pioneer Nat. Res. USA, Inc., 2023 U.S. Dist. LEXIS 26305.
- 109 F.4th 710 (5th Cir. 2024).
- MIECO LLC v. Pioneer Nat. Res. USA Inc., 2025 U.S. Dist. LEXIS 203116.
- Id. at *16.
- Id. at *11.
- Id. at *14.
- Id. at * 9.
- Id. at *20.
- LNG Ams., Inc. v. Chevron Nat. Gas, 2023 U.S. Dist. LEXIS 63868.
- Ark. Okla. Gas Corp. v. BP Energy Co. (W. Dist. - Arkansas, Fort Smith Div., 2023).
