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Rights and Duties Concerned Primarily with Surface

The right to enter land to prospect for and to take oil and gas is an ownership right.  Mineral interest owners and lessees are entitled to conduct exploration.  The authority to explore for oil and gas extends to the mineral interest of an owner’s lessee.  The right includes surface ingress and egress and the authority to occupy the surface to the extent reasonably necessary for exploring and marketing the oil and gas[i].

The interest is in the nature of a property right, and the surface estate is servient to the dominant mineral estate for the purpose of oil and gas development[ii].  By classifying the mineral estate as dominant over the servient surface estate, the law gives the mineral lessee an easement in the surface estate for the purpose of developing its mineral interest.

Generally, if there no entirety clause is involved, the lessor owns all of the oil beneath the surface of his/her acreage. However, because of the fugitive nature of oil, which can flow from and to adjoining lands, the lessor owns the oil only in a qualified sense.

If there is no oil and gas lease, the landowner has a right to explore and drill for oil on his/her land and any such oil produced is reduced to his/her personal property.  It is to be noted that the lease creates an exclusive right to explore and reduce the oil to lessee’s possession, at which time it becomes his/her personal property and the lessor retains only a royalty interest[iii]

Under a lease, the lessee has sole discretion to drill wells at any point on the leased premises to operate the field in the most productive and efficient manner.  The lessor retains the right to the surface, subject to the lessee’s right of ingress to and egress from the sub surface.  Each of these interests may be independently conveyed or assigned by the lessor[iv].

It is to be noted that a surface estate is servient to the mineral estate for the purposes of the mineral grant.  However, this right is to be reasonably exercised with due regard to the rights of the owner of the surface[v].

Generally, the owner of the oil and mineral estate has a right to enter upon the surface of the property and make such use reasonably required for the enjoyment of his/her estate.  However, if the oil and gas lessee is not granted exclusive possession of the surface by the terms of the lease, s/he will not have a right to such possession[vi].

It is to be noted that a holder of the surface rights of land subject to a gas and oil lease, and the holder of the gas and oil rights must respect each other’s interests and rights.  However, the surface rights of a lessee do not extend to using the property for residential or agricultural purposes.  Moreover, a lessee under an oil and gas lease will become liable if its actions are performed negligently or if a lessee uses more of the surface than is reasonably necessary for the operation and development of the lease.

[i] Enron Oil & Gas Co. V. Worth, 1997 Ok Civ App 60 (Okla. Civ. App. 1997).

[ii] Dulaney V. Oklahoma State Dep’t Of Health, 1993 Ok 113 (Okla. 1993).

[iii].Foertsch v. Schaus, 477 N.E.2d 566 (Ind. Ct. App. 1985).

[iv] Id.

[v] Humble Oil & Refining Co. v. L. & G. Oil Co., 259 S.W.2d 933 (Tex. Civ. App. 1953).

[vi] Wall v. Shell Oil Co., 209 Cal. App. 2d 504 (Cal. App. 2d Dist. 1962).


Inside Rights and Duties Concerned Primarily with Surface