RANCHING Business
75 feet on each side of the pipe during construction, and the company pays for this temporary easement. Once construction is fi nished, the pipeline right-of-way reverts to a narrow width because large equipment is no longer needed. Landowners can also rent sev- eral acres to a pipeline company to use as a laydown yard, where supplies and vehicles are stored during construction. If a company brings noxious plants, including twin-
leaf senna, cocklebur or pear cactus onto the ranch, a noxious plant provision can force the pipeline company to eradicate these plants. Require a weed wash so that equipment does not scatter noxious plant seeds from other locations onto a clean pasture. To avoid lawsuits, Wallace likes to add an in-
demnification to hold harmless clause and an in- surance clause to ensure the company has adequate insurance. Do not warrant title to the land. Instead, allow the pipeline company to use the land as is and where is. Consider adding these items to a pipeline agreement: • Tax liability: Pipeline companies customarily pay taxes for their improvements, plus extra taxes if an ag-use exemption changes to a non ag-use exemption.
• Pipeline use limits: Limit use to 10 years. Add non-use provisions to prevent a company from using old, deteriorated lines that may leak.
• Roads: Companies should build roads for their own use and pay to use roads outside of the pipeline easement. Prevent accidents with speed limits.
• Fires: Specify that the pipeline company will cover damages to pastures, fencing, structures and livestock if employees cause a fi re.
• Valuable trees: The landowner will be compen- sated if the company removes a valuable tree, such as a 100-year-old oak or pecan.
• Regulations: Construction, restoration and re- moval guidelines.
“These are general issues associated with pipe-
lines,” Wallace explains. “You have to be careful not to make a surface use agreement too broad. An SUA pre-negotiates the use of a piece of property into the future. Any time you pre-negotiate and you look back on it 10 to 15 years later, you fi nd that you left something out. A pipeline agreement can be part and parcel of an SUA or an oil and gas lease. I prefer a standalone pipeline agreement because you negotiate items as they happen.”
76 The Cattleman September 2016
thecattlemanmagazine.com
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