Justia Energy, Oil & Gas Law Opinion Summaries

The case involves SCS Carbon Transport LLC ("Summit") and a group of landowners. Summit plans to construct an interstate pipeline to transport carbon dioxide to sequestration sites in North Dakota and four other states. To determine the appropriate pipeline route, Summit needs to access the landowners' properties. However, the landowners denied Summit permission to enter their lands. Consequently, Summit filed lawsuits against the landowners, seeking a court order confirming its right under North Dakota law to enter the lands to conduct pre-condemnation surveys and examinations. The landowners counterclaimed, arguing that the statute authorizing entry is unconstitutional.The district courts granted summary judgment to Summit, concluding that the statute does not constitute an unconstitutional per se taking, Summit is a common carrier authorized to exercise eminent domain, and the proposed surveys and examinations are the type of minimally invasive surveys and examinations allowed under the statute. The courts confirmed Summit's right to enter the lands to complete civil, environmental, and archaeological/cultural surveys and examinations, including any necessary geotechnical/soil borings, archaeological/cultural resource surveys and examinations, and including any necessary core or water sampling activities subject to any conditions.The landowners appealed the judgments and order granting summary judgment, arguing that the statute is unconstitutional on its face and as applied to them under the Takings Clause of the Fifth Amendment and article I, § 16 of the North Dakota Constitution.The Supreme Court of North Dakota affirmed the lower courts' decisions. The court concluded that the landowners have not established a constitutional violation on the face of the entry statute or as applied to them, and the judgments and order do not exceed the scope of the entry statute. The court also found that the district court's judgment does not grant Summit an indefinite or perpetual right of access. The court held that a constitutionally permissible entry may not be longer or more invasive than necessary to complete the examination or survey needed to confirm and minimize the scope of the anticipated taking of private property. View "SCS Carbon Transport v. Malloy" on Justia Law

The case involves Continental Resources, Inc., an Oklahoma oil and gas company, and Rick and Rosella Fisher, who own a farm in North Dakota. Continental drilled a horizontal disposal well on the Fishers' property to inject saltwater waste into the pore space of a rock formation known as the Lodgepole. The Fishers sued Continental, claiming that the company had no right to drill the well. The district court ruled that Continental had the right to proceed with drilling and using the well as long as the use was reasonable, but the Fishers were entitled to compensation for any proven damage to their pore space.The district court denied Continental's motion for judgment as a matter of law and the jury awarded the Fishers $22,440.25. Continental then renewed its motion for judgment as a matter of law and, in the alternative, moved for a new trial. The Fishers moved for an award of attorneys’ fees and costs. The district court denied Continental’s motion and awarded the Fishers $249,243.60 in attorneys’ fees and $87,639.89 in costs.The United States Court of Appeals for the Eighth Circuit affirmed the district court's decision. The court found that there was sufficient evidence to support the jury’s verdict. The court also held that the district court did not abuse its discretion in admitting the third-party contracts and Rick Fisher’s testimony. Finally, the court affirmed the district court's award of attorneys’ fees and costs to the Fishers. View "Continental Resources, Inc. v. Fisher" on Justia Law

This case involves a dispute over a lease agreement between Tera, L.L.C., and Rice Drilling D, L.L.C., and Gulfport Energy Corporation. The lease granted Rice Drilling and Gulfport Energy certain mineral rights in the geological formations known as the Marcellus Shale and the Utica Shale beneath Tera’s land. The dispute arose when Tera claimed that the defendants had intentionally drilled six wells into the Point Pleasant formation, which Tera argued was not included in the lease agreement.The trial court awarded summary judgment to Tera, concluding that the lease agreement clearly limited the rights granted to the defendants to the Marcellus and Utica formations and reserved rights to all other formations. The court also found that the defendants had trespassed in bad faith, and a jury awarded Tera over $40 million in damages.The Court of Appeals for Belmont County affirmed the trial court's decision. The court concluded that the lease language was unambiguous and that the phrase "Utica Shale" had a technical stratigraphic meaning that did not include the Point Pleasant formation.The Supreme Court of Ohio reversed the lower courts' decisions. The court found that the lease agreement was ambiguous because it did not clearly establish whether the Point Pleasant was or was not to be considered part of the Utica Shale. The court concluded that resolving the meaning of ambiguous terms in a contract is a matter of factual determination for the fact-finder. Therefore, the court remanded the case to the trial court for further proceedings. View "Tera, L.L.C. v. Rice Drilling D, L.L.C." on Justia Law

The case involves Mountain Valley Pipeline, LLC (Appellee), which is constructing an interstate natural gas pipeline. The company acquired easements on properties along the pipeline’s route through condemnation actions under the Natural Gas Act. One such property was owned by Frank Terry, John Coles Terry, and Elizabeth Terry (Appellants), which was encumbered by temporary and permanent easements on 8.37 acres. After the district court granted Appellee immediate possession of the easements, the case proceeded to a jury trial to determine the amount of just compensation owed by Appellee to Appellants for the easements. The jury rendered a $523,327 verdict, which Appellee challenged, arguing that the verdict resulted from the jury improperly mixing expert testimony. The district court agreed with Appellee and granted judgment as a matter of law, vacating the jury verdict and entering a judgment for $261,033.The United States Court of Appeals for the Fourth Circuit reversed the district court’s judgment as a matter of law and remanded with instructions to reinstate the $523,327 verdict. The court held that the jury’s verdict was within the range of credited testimony and could be supported using residential values alone, without the need to venture beyond the credited testimony. The court also reversed the district court’s grant of a new trial. Additionally, the court vacated and remanded the district court’s order denying Appellants’ second motion for attorney’s fees and costs, leaving these issues for the district court to consider in the first instance. View "Mountain Valley Pipeline, LLC v. 8.37 Acres of Land" on Justia Law

The case revolves around the ownership of mineral rights beneath a dedicated street in Greeley, Colorado. The dispute arose between Great Northern Properties, LLLP (GNP) and Extraction Oil and Gas, Inc., Richmark Energy Partners, LLC, and Richmark Royalties, LLC (collectively, Extraction) over who is entitled to receive certain oil and gas royalty payments. The issue at hand was how to determine who holds title to the mineral estate under a dedicated right-of-way when a grantor, who has an interest in the mineral rights under that right-of-way, executes a conveyance of the land abutting the right-of-way that is silent as to those rights.The district court agreed with Extraction, concluding that the centerline presumption could be applied to a conveyance of the mineral estate beneath a right-of-way. The court of appeals affirmed the district court’s determination of law. However, the court of appeals also concluded that the centerline presumption should not apply if the grantor retains ownership of any property abutting the right-of-way.The Supreme Court of the State of Colorado affirmed the court of appeals' decision that a conveyance of land abutting a right-of-way is presumed to carry title to the centerline of both the surface and mineral estates beneath a dedicated right-of-way to the owners of land abutting that right-of-way. However, the Supreme Court reversed the court of appeals' conclusion that the centerline presumption cannot apply if a grantor retains ownership of any property abutting the subject right-of-way. The Supreme Court held that the centerline presumption applies if the party claiming ownership to land abutting a dedicated right-of-way establishes that the grantor conveyed ownership of land abutting a right-of-way, the grantor owned the fee to both the surface estate and the mineral rights underlying the right-of-way at the time of conveyance, and no contrary intent appears on the face of the conveyance document. View "Great Northern Properties v. Extraction Oil and Gas" on Justia Law

The case revolves around a dispute over oil and gas interests between Spottie, Inc., a Nevada corporation, and several other Nevada corporations and a limited liability company. Spottie alleged that the defendants had wrongfully claimed title to these interests, which were once owned by Edward Davis, who had formed Spottie as a holding company. The defendants countered that they had entered into an agreement with Davis to acquire these interests, and that Davis and Spottie had transferred the disputed interests to one of the defendants via an assignment in 2016.The district court dismissed several of Spottie's claims, leaving only a quiet title claim and a claim for unjust enrichment. After a three-day bench trial, the court ruled in favor of the defendants, finding that the assignment from Davis and Spottie to one of the defendants was valid. The court also found that Spottie had erroneously received revenue from the disputed interests and awarded damages to the defendants.Spottie appealed the decision, arguing that the district court had erred in its ownership determination, its rejection of Spottie's laches defense, its binding of a non-party to the judgment, and its award of attorney fees and costs. The Supreme Court of North Dakota affirmed in part, concluding that the district court did not err in its ownership determination and its award of attorney fees. However, it reversed in part, finding that the court had erred in awarding costs for non-legal expenses. The case was remanded for the court to recalculate its cost award and to consider the defendants' request for additional attorney fees and legal costs. View "SPOTTIE v. BAIUL-FARINA" on Justia Law

Phoenix Capital Group Holdings, LLC, an oil and gas mineral rights investment firm, acquired mineral interests on two sections of real property in Richland County, Montana. The previous owner, Katherine Solis, had been approached multiple times by Kraken Oil and Gas LLC, an energy production company, to secure a lease of the mineral interests or to participate in drilling wells. Solis consistently refused to engage with Kraken. After Phoenix acquired the mineral interests, it expressed a desire to participate in the oil and gas production from the wells being drilled by Kraken. However, Kraken responded that the mineral interests had been deemed “non-consent” due to Solis’s lack of participation, and it was authorized to recover risk penalties.The Board of Oil and Gas Conservation of the State of Montana held a hearing and determined that Kraken had made unsuccessful, good faith attempts to acquire voluntary pooling in the spacing unit, and that Phoenix, as a successor in interest, was bound to Solis’s decision not to participate. The Board therefore determined that the mineral interests owned by Phoenix would be subject to forced pooling and that Kraken could recover risk penalties from Phoenix. Phoenix requested a rehearing from the Board, but that request was denied. Phoenix then filed a Complaint seeking injunctive relief from the Board decision in the Thirteenth Judicial District Court, Yellowstone County. The District Court issued an Order granting Kraken and the Board’s motions for summary judgment, and dismissing Phoenix’s Complaint.In the Supreme Court of the State of Montana, Phoenix appealed the District Court's decision. The Supreme Court affirmed the lower court's decision, holding that the Board correctly interpreted the statutory force-pooling requirements, and that its decision to force pool Phoenix’s mineral interests was reasonable. The court also held that Kraken’s letters to Solis constituted written demands that gave Solis the option to either participate or face assessment of risk penalties. The court concluded that risk penalties were imposed, not pursuant to the presumption in § 82-11-202(3), MCA (2021), but under § 82-11-202(2), MCA, which requires an owner pay risk penalties when “after written demand, [the owner] has failed or refused to pay the owner’s share of the costs of development or other operations . . . .” View "Phoenix Capital v. Board of Oil & Gas" on Justia Law

The case involves a dispute over the approval of a site certificate for the construction of a wind energy facility in Umatilla County, Oregon. The Energy Facility Siting Council granted the certificate to Nolin Hills Wind, LLC, despite the proposed facility not complying with a local siting criterion requiring a two-mile setback between any turbine and a rural residence. Umatilla County sought judicial review of the council's decision, arguing that the council should have required Nolin Hills to comply with the two-mile setback rule.The case was reviewed by the Supreme Court of the State of Oregon. The court noted that the council had the authority to approve the proposed energy facility despite its failure to comply with the two-mile setback rule. The court also noted that the council had the authority to approve the proposed facility even if it did not pass through more than three land use zones and even if it did not comply with all of the county’s recommended substantive criteria.The Supreme Court of the State of Oregon affirmed the council's decision, concluding that the council was authorized to issue a site certificate for the proposed wind facility notwithstanding the failure of the proposed facility to comply with the two-mile setback rule. The court found that the council was not required to reject a proposed facility simply because it did not comply with a local criterion. The court also rejected the county's argument that the council erred in concluding that the proposed facility "does otherwise comply with the applicable statewide planning goals." View "Umatilla County v. Dept. of Energy" on Justia Law

The case involves Mojalaki Holdings, LLC and GSSG New Hampshire, LLC (the plaintiffs) who appealed a decision by the City of Franklin Planning Board (the Board) that denied their site plan application to install a solar panel array on a piece of land owned by Mojalaki. The proposed solar panel array required the installation of new utility poles and the removal of mature trees to ensure sufficient sunlight. The land, which was mostly open space and was once a golf course, did not have any specific ordinance language addressing solar panel arrays. The Board, after multiple hearings and a site visit, denied the application based on concerns raised by neighbors about the project's potential impact on the scenery, property values, and previous negative experiences with other solar projects in the city.The Board's decision was upheld by the Superior Court, which agreed with the Board's first and third reasons for denial, namely that the installation of new utility poles would create an industrial look out of place in the neighborhood, and that cutting down mature trees contradicted the purpose provisions. However, the Superior Court did not uphold the Board's second basis, that the solar panel array endangered or adversely impacted the residents, due to lack of supporting facts.The Supreme Court of New Hampshire reversed the lower court's decision, ruling that the Board could not rely solely on the purpose provisions to deny the application. The court found that the purpose provisions lacked sufficient specificity for site plan review and left the proposed project to be judged by the subjective views of the Board through ad hoc decision making. The court granted the plaintiffs a builder's remedy, allowing them to proceed with their development provided they comply with all other applicable regulations. View "Mojalaki Holdings v. City of Franklin" on Justia Law

Whitetail Wave LLC, a Montana Limited Liability Company, sued XTO Energy, Inc., a Delaware corporation, the Board of University and School Lands of the State of North Dakota, the State of North Dakota, and the Department of Water Resources and its Director. Whitetail Wave claimed ownership of certain property in McKenzie County, North Dakota, and alleged that XTO Energy had breached their lease agreement by failing to make required royalty payments. Whitetail Wave also claimed that the State's assertion of an interest in the mineral interests associated with the property constituted an unconstitutional taking without just compensation.The District Court of McKenzie County granted summary judgment in favor of the State and XTO Energy. The court concluded that the State owned certain mineral interests within the ordinary high watermark as defined by North Dakota law. The court also found that XTO Energy was within the safe harbor provision provided by North Dakota law and did not breach the parties’ lease agreement when it withheld the royalty payments. The court awarded XTO Energy recovery of its attorney’s fees.On appeal, the Supreme Court of North Dakota affirmed the judgment of the district court. The Supreme Court found that the district court did not err in dismissing Whitetail Wave's claim of an unconstitutional taking against the State, as the State's actions were limited to a title dispute. The Supreme Court also found that the district court did not err in dismissing Whitetail Wave's claim against XTO Energy for the non-payment of royalties, as XTO Energy fell within the safe harbor provision of North Dakota law. Finally, the Supreme Court found that the district court did not err in awarding XTO Energy a recovery of its attorney’s fees as the prevailing party. View "Whitetail Wave v. XTO Energy" on Justia Law