U
NTIL THE RECENT EXPLOSION IN OIL EXPLORATION, MANY RANCHERS AND LAND- owners in Texas placed their oil and gas interests on the back burner. Sometimes they had no idea of what their rights were,
and they frequently felt as though they were at the mercy of the landman. Landowners would benefi t from an understanding of oil and gas business fundamentals, including the basics of important Texas Supreme Court cases that have infl uenced the industry. Although some landowners may own all their mineral and surface
rights, others hold only surface rights. For instance, the law considers the mineral estate or ownership of minerals to be dominant or more important than the subservient surface estate. David Wallace, rancher, mineral owner and oil and gas attorney, is also
an instructor at Texas Christian University (TCU) and the TCU Energy Institute. He says that if either the petroleum company (lessee) or mineral owner (lessor) wishes to develop their minerals, they have the right to do that, subject to reasonable use. For many years, landowners who owned both minerals and surface
wrote their oil and gas leases to include reasonable requests. Older leases commonly required that no drilling could occur closer than 200 feet from the house and barn, and pipelines had to be buried. Newer lease forms may be very specifi c. For example, the oil company may be required not to conduct opera-
tions in a certain pasture during calving, lambing or kidding season. The person who owns both mineral and surface rights has the privilege of writing the terms of the lease. Sometimes landowners have inherited or purchased property with “out-
standing” minerals and leases, which are owned by another individual or entity such as an oil company. Wallace reports that after the mineral owner signs a lease, the stage is set for serious disagreements to occur, because the surface owner has no say in how the oil and gas company will use his or her land. The Texas Supreme Court has decided several cases that have deter- mined how oil and gas companies conduct business.
Reasonable accommodation In the 1971 case, Getty Oil Company v. Jones, a Gaines County farmer
The Texas Supreme Court has decided several cases that have determined how oil and gas companies conduct business.
tscra.org
had a center pivot irrigation system on his property. Getty drilled a well on John Jones’ farm, installing a wellhead that was taller than the pivot, which interrupted the pivot’s normal use. After Jones asked Getty to drop the wellhead into a pit or cellar in order
to utilize his pivot, Getty refused. “This case went to the Texas Supreme Court, resulting in the Reasonable
Accommodation Doctrine,” Wallace explains. “Yes, you have the right to do what is reasonably necessary subject to the reasonable accommoda- tion of the landowner. It does not cost much to put that well in a cellar versus the landowner’s loss of a prior existing use. That was a [positive] development.” Another case that helped surface owners was Robinson v. Robbins Pe-
troleum Corporation Inc., in 1973. In this situation, Robbins Petroleum had a mineral lease in Wood County, while R.O. Robinson owned only the
November 2015 The Cattleman 93
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