solar above, oil & gas below: coexistence in energy project development

Principal Solar InstituteSolar Above, Oil and Gas Below:Coexistence In Energy Project Development

RANDY SOWELLLionshare Advisory ServicesMcCamey, Texas(432) 301-0002lionsharers@hotmail.com

GREGORY S. FRIENDStahl, Bernal & Davies, LLP.Austin, Texas(512) 652-2949gfriend@sbaustinlaw.com

Principal Solar Institute

Can’t We All Just Get Along?

Principal Solar Institute

What’s the Problem?

Oh, right.

Mineral estate is dominant estate, and has the right to utilize as much of the surface as is reasonably necessary to exploit minerals below.

Due regard and accommodation doctrine.AK, AR, CO, NM, ND, UT and WV also

recognize the accommodation doctrine, and others states have enacted specific surface damages statutes.

Texas (and some other places) Law

Solar Resource

Oil and Gas

Railroad Commission Rule 76Surface owner may request qualified subdivision.Qualified subdivision:– may not be > 640 acres– Located in • Counties with population > 400,000• Counties with population > 140,000 so long as it

borders county with population > 400,000 or located on border island.

– “Operations site” for each 80 acres; 2 acres or >.– Road and pipeline easements.– Subdivided for residential, commercial or industrial use.

Railroad Commission Rule 76

Surface owner files application; RRC provides hearing notice to all possessory interest holders.

RRC considers adequacy of number and location of operations sites and road and pipeline easements.

If application granted, surface owner must begin construction of roads or utilities and sell lot within 3 years.

SWEPI v. RRC– Qualified subdivision for each 640.– Landfill satisfies “industrial use;” broad authority to RRC.

Bureau of Land Management

BLM administers surface estates and mineral estates on publicly owned lands– 261 Million Surface Acres– 700 Million Mineral Acres• 58 Million are Split Estates

BLM requires that the mineral lessee engage the Surface Owner in negotiations for the purpose of obtaining a surface use agreement.

BLM requires the lessee/operator make a good faith effort to obtain a surface use agreement.

BLM - Split Estate Options Amend Resource Management Plan– Open or Closed to leasing; lease stipulations

Mineral Conveyance– Federal Land Policy and Management Act (FLPMA)• Section 209 (b) – “may convey mineral interests owned

by the U.S. where the surface is in non-federal ownership if ….1) There are no known mineral values in the land or2) The reservation of mineral rights is interfering with or

precluding appropriate non-mineral development of the land and that such development is a more beneficial use of the land.”

3) Conveyance only to surface owner of record.

QUESTIONS?

Principal Solar InstituteSolar Above, Oil and Gas Below:Coexistence In Energy Project Development

RANDY SOWELLLionshare Advisory ServicesMcCamey, Texas(432) 301-0002lionsharers@hotmail.com

GREGORY S. FRIENDStahl, Bernal & Davies, LLP.Austin, Texas(512) 652-2949gfriend@sbaustinlaw.com

Principal Solar Institute