MORGANTOWN — Surface owners scored a victory over natural gas developers in a ruling handed down by the state Supreme Court Wednesday.
The court unanimously upheld a Doddridge County Circuit Court ruling that said a developer and mineral owner have no right to use a surface owner’s land to develop minerals under neighboring properties, without the surface owner’s permission.
The Supreme Court said, “A mineral owner or lessee has an implicit right to use the overlying surface to access only the minerals directly below the surface. Using the surface to extract minerals elsewhere, without the permission of the surface owner, is a trespass.”
The case is known as the Crowder-Wentz case, after the plaintiffs, Margot Beth Crowder and David Wentz, a divorced couple who sued EQT over alleged trespass in November 2014.
Crowder and Wentz own a portion of a 351-acre tract known as the Carr Tract. The tract’s original owners signed an oil and gas development lease with EQT’s predecessors in 1901. In 1936, the mineral and surface estates were separated.
Wentz owns two parcels of the Carr Tract and Crowder owns one; they have only surface rights.
In 2011, the mineral owners agreed with EQT to modify the lease to allow pooling with other tracts.
Crowder and Wentz denied EQT permission to use their surface to develop mineral tracts. EQT nonetheless entered their land and adjacent parcels in 2013; cleared 42 acres; built roads and a 19.7-acre well pad; and used it to drill nine horizontal wells drawing gas from 3,232 acres. About 37.5% of the bores were under the Carr Tract, the remainder other tracts.
In their 2014 suit, the plaintiffs acknowledged EQT had a right to use their surface to develop minerals under the Carr Tract, but not neighboring tracts.
EQT argued its surface use conformed to existing law regarding reasonable and necessary use of surface to develop minerals.
EQT also argued that because the mineral owners modified the lease in 2011, the modified lease carried with it the right to use the plaintiffs’ surface to develop the larger unit.
The Supreme Court sided with the circuit court in rejecting both arguments. In rejecting the second argument, it said, “in 2011, the owners of the mineral estate no longer owned the right to use the surface estate for exploration on and production from neighboring tracts. Because the mineral estate was severed from the surface estate in 1936, that right belonged to the plaintiffs or, more specifically, was a right attached to their surface estate. Hence, the mineral owners could not have conveyed that right to EQT in the 2011 amendment.”
“The industry has shown that horizontal drilling and hydraulic fracturing techniques are evolving at a rapid pace and are an economical and efficient tool for producing hydrocarbons,” the court said. “Our opinion only affirms a classical rule of property jurisprudence: it is trespassing to go on someone’s land without the right to do so. … Should the mineral owner or lessee want to utilize the surface to access minerals under neighboring land, they can certainly reach a separate agreement with the surface owner.”
West Virginia Surface Owners Rights Organization Dave McMahon represented the plaintiffs. After the ruling he told WV MetroNews’ Jeff Jenkins, “We’re absolutely thrilled. We’ve thought this was the law all along. We thought it was obvious.”
But it took eight years for the issue to reach the Supreme Court to affirm it’s the law statewide, McMahon said.
The Court did caution this ruling doesn’t challenge or constrain contemporary drilling methods.
EQT commented via an email exchange: “EQT has always worked with landowners to prevent potential issues or disagreements, including through the use of surface agreements to compensate surface owners on the impact of our operations. While we are disappointed in the court’s ruling, we don’t expect the decision to have a significant impact on our operations in West Virginia. We intend to maintain cooperative and mutually beneficial relationships with our customers, our partners, and residents in the regions where we do business.
“This decision does not affect EQT operations in other states.”
Dissenting Opinion, Workman, J., Robert L. Andrews, et al. v. Antero Resources Corporation and Hall Drilling, Inc. – Case No. 17-0126
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