Mineral Estate Surface Use Limitations
Any surface damages discussion must begin with the caveat that the mineral estate is dominant to the surface estate. This means that the mineral owner has the right to use as much of the surface as is reasonably necessary to develop the minerals but must do so with due regard for the rights of surface owners and without negligence. Texas law defers generally to the lessee’s view of reasonableness. To make matters worse for surface owners, the mineral owner is not obligated to pay surface owners for ordinary damages caused by exercising its rights or to restore the surface to its prior condition. In the real world, operators know surface operations concern surface owners and customarily pay some money in advance for such damages, but the surface owner should remember that this is not required by law and may be an insignificant amount. This general rule is not absolute. The mineral owner:
(1) can use only as much of the surface as reasonably necessary to develop the minerals;
(2) must use the surface with due regard for the surface owner’s rights; and
(3) not be negligent in its use of the surface estate.
By violating one of these prohibitions, the mineral owner can be liable to the surface owner for damages.
The mineral owner’s surface use must be reasonable and necessary. Courts defer to the mineral owner if the use is normal in the industry and related to producing the mineral estate. One important limitation on the reasonableness of a mineral owner’s surface use is the use must benefit the related mineral estate. Using a surface to benefit the mineral estates of other lands is unreasonable to the extent other mineral estates benefit. Breaking this rule will obligate the mineral owner to pay surface damages as an ordinary trespasser. Thus, if a typical Barnett Shale well site is 5 acres and a mineral owner uses 20 acres of the related surface, a surface owner can argue the mineral owner’s use is unreasonable or unnecessary and constitutes a trespass.
The mineral owner must also use the surface with due regard for the surface owner’s rights. This is called the “Accommodation Doctrine.” Under this doctrine, the burden is on the surface owner to show that the mineral owner has reasonable alternative means to produce the minerals that will not interfere with the surface’s existing use. The surface owner’s remedy is an injunctive court order that the mineral owner use the alternative means, thereby preserving the surface estate’s existing use.
The final limitation on a mineral owner’s surface operations is that the operations cannot be negligent. This applies to both the installation and operation of facilities and equipment on the surface estate. If the surface owner or estate is injured by the mineral owner’s negligence, the surface owner can sue under general negligence theory.
Both parties should remember underlying contract terms govern their rights. If a surface owner is concerned with future surface operations, the surface owner should address the issue when negotiating the oil and gas lease, not immediately before operations begin. Operators should also define their rights in the oil and gas lease. All parties should spend a little more time thinking about future surface operations when negotiating leases to avoid later problems.
Eric C. Camp is an attorney in the law firm of Decker, Jones, McMackin, McClane, Hall & Bates, PC in Fort Worth, Texas. He is licensed in Texas and North Dakota and practices exclusively oil and gas law. Contact him at 817-336-2400 or firstname.lastname@example.org.
This article is not intended as legal advice and should not be relied upon as such. If you need legal advice, seek independent legal counsel.
These comments are the author’s own and not the official or unofficial position of any bar association. The author is an attorney licensed in Texas and North Dakota, not Louisiana.