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Oil/Gas/Subsurface Trespass

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Question
What are the options a land/mineral owner has when an oil company commits a subsurface trespass?
My siblings and I own some property in Utah.  We have leased the mineral rights out to company A.  Recently, company B, drilled a well across a state road to our south and trespassed 300' in and out of our property at 9000' underground.
They called two days ago and admitted to this, and said they'd like to "compensate" us immediately to resolve the issue (red flag?).  They claim they are not sucking any resources, but how can we be sure?  They have been fracking.
We called company A, who had not been informed, and they said they'd "take it from here".  My initial thought is to seek an injunction against company B, and I'm hesitant to just assume the companies will handle it (as I am concerned with backroom, good ole boy deals).  They clearly are in the wrong, but we're not sure where to go from here.  Do we have a case, if they're not stealing resources?  They have still trespassed and admit to guilt.  
Any help or advice you could share would be greatly appreciated.

Answer
Subsurface trespass is a difficult issue to discuss, because there simply isn't any "settled law" on the question.  Horizontal drilling is still pretty much in its infancy where state rules and regulations are concerned, and all other States are watching us here in Texas to see how we treat these delicate issues in our courts.  Right now, the only court case we have that addresses subsurface trespass of your kind is found in Coastal v. Garza.  As the appellate court in that case explained, wheeling an airplane across another's land is trespass. But flying that plane 2 miles above the same land is not trespass, and by extrapolation crossing the land 2 miles below it is not trespass.  However, if any proppants were deposited two miles below your land, that could be considered trespass, but how do you prove there are any proppants there?  It sounds like the pipe is crossing deep beneath your land, but no perforations in the pipe were made, and therefore, it should not be expected that proppants would have been deposited there.

The entity with greater probability of damages from the subsurface drill pipe crossing beneath your land is Company A, holder of the oil and gas lease covering that land.  I won't get into the reasons for that at the moment, but I see no reason why you should not remain in contact with Company A to find out how the situation gets resolved between Company A and B.  I would not accept any compensation settlement from Company B until you talk to Company A and find out if the subsurface cross-drill has reduced the value of their leasehold working interest in any way.

As for stealing resources, I would expect Utah's rules and regulations concerning lease-line restrictions to be sufficient to curb the possibility of that, but only an expert in oil and gas reservoir engineering or an oil and gas geologist can more competently answer that question--that is clearly outside my expertise.

My strongest advice is for you to visit with an oil and gas attorney (one with actual experience in handling oil and gas landowner legal issues) and the attorney can find a competent expert to answer the technical questions allowing the attorney to assess if you have a case.

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Marsha Breazeale, M.Ed., CDOA, CPLTA

Expertise

All questions regarding division orders; ownership decimal calculations; title ownership and payer record changes (testate/intestate inheritance; deed; assignment; court order); oil and gas lease analysis for record-keeping and purposes of payment by operator or payer; pooling, horizontal wells, horizontal well allocation units; unclaimed property reporting; royalty owner relations questions. All questions concerning administration of surface land contracts and payment questions, such as for Surface Right-of-Way, Sub-Surface Right-of-Way, Easement, Surface Use Agreement. All questions regarding industry-standard and company-specific policies that affect land owners.

Experience

Sr. Staff Division Order Analyst. Certified Division Order Analyst (CDOA, National Association of Division Order Analysts) and Certified Lease Analyst (CPLTA, National Association of Professional Lease and Title Analysts) with 35 years of experience as a combination division order analyst and lease analyst in exploration and production in the oil and gas industry.

Organizations
National Assoc. of Division Order Analysts (NADOA), National Association of Division Order Analysts (NALTA), American Association of Professional Landmen (AAPL), American Society of Trainers and Developers (ASTD)

Publications
"How an Oil & Gas Exploration & Production Company Operates" and "Principles of Oil & Gas Lease Analysis: Standard Clauses", Oil Patch Press; Articles in NADOA Magazine; LandFocus EDU Professional Training Manuals

Education/Credentials
B.A.in Management from Our Lady of the Lake University in San Antonio; M.Ed. in Instructional Design from WGU Texas.

Past/Present Clients
Past 15 years: GeoSouthern Energy Corporation; Contango Oil Co./Crimson Exploration & Operating Inc.; Apache Corporation; BP America; Marathon Oil; Newfield Exploration

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