Surface Access to Severed Federal Minerals
61 Rocky Mt. Min. L. Inst. 8-1 (2015)
Posted: 23 Jan 2016
Date Written: August 1, 2015
The legacy of manifest destiny is still present in the land ownership patterns of the American West. The U.S. Bureau of Land Management (BLM) administers 58 million acres of federally owned minerals that underlie non-federally owned surface parcels, many of which were granted pursuant to the Stock-Raising Homestead Act (SRHA). In struggling to balance the competing needs of the mineral and surface owners, in the absence of an express agreement between the surface and mineral owner, courts have generally permitted the mineral owner to use as much of the surface as is reasonably necessary to development of the minerals. This implied easement, however, has been strictly limited to the surface directly overlying the severed minerals; use of the surface for the sole benefit and purpose of developing adjoining parcels, without advantage to the subjacent minerals, has been prohibited. The U.S. Court of Appeals for the Tenth Circuit recently revisited this issue in the context of a federal exploratory unit in Entek GRB, LLC v. Stull Ranches, LLC. Relying on Congress’s reservations in the SRHA, the court held that unitization of federal minerals pursuant to the Mineral Leasing Act of 1920 (MLA) dissolved individual property boundaries within the unit for purposes of determining rights of surface use by the mineral lessee.
The Entek decision permits more expansive surface use within federal units and has broad-ranging implications for the future of mineral development in the West. This chapter examines the implications of the Entek decision on split-estate surface use in federal exploratory units. First it provides general background, including a brief overview of federal unitization, the SHRA, the MLA, and the Entek decision. The chapter will then look at how Entek may impact specific surface uses, including wastewater disposal, production and gathering facilities, location of man camps, and use of the surface owner’s fresh and salt water for production purposes, and the compensation paid to the surface owner for these uses. It also describes how contraction of the unit may limit the impact of Entek and how the Entek decision may result in changes to the application of the reasonable use and accommodation doctrines within federal exploratory units.
Keywords: Split Estate, Oil and Gas, Severed Minerals, Surface Access, Entek GRB, Stull Ranches, unitization, communitization, pooling
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