Saltwater Disposal Agreement: Ownership of Underground Strata; Surface Owner or Mineral Owner

摘要

In 1988 the fee owner of a tract of land enters into an oil and gas lease. The lease is perpetuated by production, and is owned by Bowman at the time of the dispute. In 2005 the fee owner, Dick Properties, conveys the land to Schonthaler, but reserves in Dick Properties the "mineral reservations, oil and gas leases . . .." At the time of the 2005 conveyance, Bowman also has a saltwater disposal agreement with Dick Properties. Following the conveyance, Bowman takes the position that the rights under the saltwater disposal agreement run with the surface estate and not the mineral estate. Ultimately, Bowman and Schonthaler enter into a new saltwater disposal agreement without including Dick Properties. Dick Properties sues contending that as the mineral owner in the land it must be included in the saltwater disposal agreement. The trial court notes that the parties agree that activities under the saltwater disposal agreement would not interfere with Dick Properties' mineral rights, or the rights of Bowman as the oil and gas lessee. The trial court holds that Schonthaler, as the surface owner, can enter into the saltwater disposal agreement without the consent of Dick Properties, the mineral owner. Held: affirmed. The appellate court notes that Dick Properties, as a severed mineral owner, has the implied right to use the surface to develop its minerals, including the right to drill and operate a saltwater disposal well. It does not, however, have the exclusive right to grant disposal rights in the land. Nor does it have the right to grant the right to dispose of saltwater produced from wells not located on the land. These are rights retained by the surface owner.