Justia Energy, Oil & Gas Law Opinion Summaries

The Supreme Court affirmed the judgment of the court of appeals concluding that use and development and alienation restrictions in a deed applied to both the surface and subsurface of the properties at issue in this case and that the village of Barnesville violated the restrictions when it transferred oil and gas rights to another entity without obtaining written permission from Ohio Public Works Commission (OPWC), holding that there was no error.The village received two grants to finance the purchase of two properties for conservation projects. The OPWC brought this action claiming that the village violated transfer and use restrictions in the deeds for the properties at issue by transferring oil and gas rights to another entity, which leased those rights to Gulfport Energy Corporation, without obtaining the OPWC's permission. The court of appeals granted judgment in favor of OPWC. The Supreme Court affirmed, holding that the court of appeals correctly determined that the village violated the use and development restrictions when it transferred oil and gas rights without OPWC's written consent. View "Ohio Public Works Commission v. Village of Barnesville" on Justia Law

The Supreme Court affirmed the decision of the Ohio Power Siting Board to approve the application of Icebreaker Windpower, Inc. for a certificate of environmental compatibility and public need to build a six-turbine wind-powered electric-generation facility in Lake Erie, holding that Appellants did not meet their burden of demonstrating that the Board's decision was against the manifest weight of the evidence.Specifically, the Supreme Court held (1) there was sufficient evidence in the record before the Board for it to determine the nature of the probable environmental impact of the project under Ohio Rev. Code 4906.10(A)(2) and whether the project represented the minimum adverse environmental impact under Ohio Rev. Code 4906.10(A)(3); and (2) the Board did not err in determining that it lacked jurisdiction to consider the residents' public-trust argument. View "In re Application of Icebreaker Windpower, Inc." on Justia Law

In this appeal from a judgment of the Seventh District Court of Appeals, the Supreme Court held that Ohio's Marketable Title Act (MTA), Ohio Rev. Code 5301.47 et seq., applied to an oil and gas interest that had been severed from its surface property.Senterra, Ltd., the owner of the surface property at issue in this case, sought to quiet title to the disputed one-quarter oil and gas interest in its favor, urging the Court to apply the deed-interpretation rule of equity set forth in Duhig v. Peavy-Moore Lumber Co., 144 S.W.2d 878 (Tex. 1940) (the Duhig rule). The heirs to the oil and gas interest argued, in response, that the Duhig rule was inapplicable and that the MTA applied and gave them marketable record title to the interest. The trial court granted summary judgment to Senterra. The Seventh District reversed, ruling that the Duhig rule was inapplicable and that the MTA applied. The Supreme Court affirmed, holding (1) the oil and gas interest retained by the heirs was not subject to the Duhig rule; and (2) the heirs' interest was preserved under the MTA. View "Senterra, Ltd. v. Winland" on Justia Law

The Supreme Court affirmed the judgments of the court of appeals reversing the trial court's decisions in these two cases consolidated for appeal, holding that owners of the surface rights to land did not comply with the requirements of the Dormant Mineral Act, Ohio Rev. Code 5301.56, in seeking to have mineral interests in that land deemed abandoned.Plaintiffs filed complaints for declaratory judgment and seeking to quiet title, alleging that the surface owners had failed to exercise reasonable due diligence in attempting to locate holders of the mineral interests before commencing the abandonment process. The trial court granted summary judgment in favor of Defendants in both cases. The court of appeals reversed in both cases, ruling that Defendants' searches were unreasonable and that they had failed to comply with the relevant notice requirements. The Supreme Court affirmed, holding that Defendants failed to exercise reasonable diligence in these cases. View "Fonzi v. Brown" on Justia Law

The Supreme Court held that an action seeking a determination that an oil and gas lease has expired by its own terms is a controversy "involving the title to or the possession of real estate" so that the action is exempt from arbitration under Ohio Rev. Code 2711.01(B)(1).Appellants brought an action for declaratory judgment alleging that oil and gas leases between the parties had terminated because Appellee failed to produce oil or gas or to commence drilling operations within the terms of the lease. Appellee moved to stay pending arbitration. The trial court denied the request, concluding that Appellants' claims involved the title to or the possession of real property, and therefore, were exempt from arbitration under Ohio Rev. Code 2711.01(B)(1). The court of appeals reversed. The Supreme Court reversed, holding the trial court correctly declined to stay the action in this case pending arbitration. View "French v. Ascent Resources-Utica, LLC" on Justia Law

The Supreme Court reversed the judgment of the court of appeals affirming the decision of the trial court dismissing this complaint brought by the Attorney General alleging that Defendants, including Rover Pipeline, LLC, had illegally discharged millions of gallons of drilling fluids into Ohio's waters, causing pollution and degrading water quality, holding that the lower courts erred.Rover sought a license to construct an interstate pipeline that cross several counts in Ohio. As required by 33 U.S.C. 1341(a)(1) - section 401 of the Clean Water Act - Rover applied for certification for the state that any discharge into the state's navigable waters would comply with federal law. The state later brought this action against Rover and other companies involved in building the pipeline. The Supreme Court reversed the dismissal of this lawsuit, holding (1) the state waived its ability to participate in the certification process when it did not respond to Rover's application within one year; but (2) the waiver applies only to issues that are related to the section 401 certification, and therefore, remand was required for a determination of whether any of the state's allegations address issues outside the contours of the section 401 certification. View "State ex rel. Yost v. Rover Pipeline, L.L.C." on Justia Law

The Supreme Court affirmed the judgment of the court of appeal concluding that a municipality does not violate Ohio Const. art. XVIII, 6 by selling a surplus of electricity to customers outside the municipality's boundaries, holding that the court of appeals did not err.The City of Cleveland sold outside its boundaries approximately four percent of the electricity it sold inside its boundaries. Cleveland Electric Illuminating Company (CEI) brought this complaint arguing that the electricity the City sold extraterritorially as surplus violated this Court's decision in Toledo Edison Co. v. Bryan, 737 N.E.2d 529 (2000) and the Ohio Constitution. The trial court granted summary judgment for the City. The court of appeals reversed, determining (1) Article XVIII, Section 6 does not require a municipality to buy the precise amount of electricity required by its inhabitants at any given time, and (2) questions of material fact existed as to whether the City obtained surplus electricity for the sole purpose of selling it to a neighboring city. The Supreme Court affirmed, holding that while a municipality may not acquire excess capacity for the sole purpose of reselling it outside the municipality's territorial boundaries, the municipality is not required to purchase the exact amount of electricity necessary to satisfy the current needs of its territorial customers. View "Cleveland Electric Illuminating Co. v. Cleveland" on Justia Law

The Supreme Court affirmed the order of the Ohio Power Siting Board granting Duke Energy Ohio, Inc. a certificate of environmental compatibility and public need to construct, operate, and maintain a natural-gas pipeline, holding that the Board's decision was not manifestly against the weight of the evidence and was not so clearly unsupported by the record as to show a mistake or willful disregard of duty.Specifically, the Supreme Court held (1) assuming without deciding that the Board misapplied its filing requirements, the error was harmless; (2) the Board did not err in determining that Duke's proposal met the conditions of Ohio Rev. Code 4906.10(A)(1); (3) the Board properly accounted for the interest of safety in evaluating Duke's proposal; (4) the Board did not err by not requiring Duke to evaluate the pipeline's impact against the City of Blue Ash's most recent comprehensive plan; (5) the Board did not err in evaluating the pipeline's estimated tax benefits; and (6) the Board did not deprive Blue Ash of due process of law. View "In re Application of Duke Energy Ohio, Inc." on Justia Law

The Supreme Court reversed the decision of the Public Utilities Commission of Ohio (PUCO) allowing a gas company to charge its customers higher rates, holding that the PUCO erred by approving the rate increase.At issue was whether Suburban Natural Gas Company's customers must pay for a 4.9-mile extension of the company's pipeline. The PUCO determined that the pipeline extension met the "used-and-useful" test as of a specified date and approved the rate increase. See Ohio Rev. Code 4909.15(A)(1). The Supreme Court reversed, holding (1) the PUCO looked beyond whether the entire 4.9-mile extension was used and useful on the applicable date and considered whether it was a prudent investment because it might prove useful in the future; and (2) therefore, the PUCO erred in evaluating the rate increase. View "In re Application of Suburban Natural Gas Co." on Justia Law

The Supreme Court reversed the judgment of the Fifth District Court of Appeals reversing the decision of the trial court declaring that Appellants owned certain mineral rights and quieting title to the rights in their favor, holding that the reservation of mineral rights in this case was preserved by Ohio Rev. Code 5301.49(A).At issue was whether a reference to a reservation of mineral rights in a surface landowner's root of title and in subsequently recorded title transactions was sufficiently specific to preserve the reservation of the mineral rights under Ohio's Marketable Title Act when the reference does not name the record owner of the rights. The Supreme Court held (1) in enacting section 5301.49(A), the Legislature did not require a reference to an interest predating the root of title to name the interest's owner in order to preserve the interest; and (2) in this case, notwithstanding the failure to name the owner of the reserved mineral rights, the reference was sufficient to preserve the rights from being extinguished under the Act. View "Erickson v. Morrison" on Justia Law