REASONABLE ACCOMMODATION: SPLIT ESTATES,
CONSERVATION EASEMENTS, AND DRILLING IN THE
MARCELLUS SHALE
Paige Anderson*
Natural gas production from shale formations is potentially a
valuable source of domestic energy, but the industry still must
overcome many legitimate concerns about drilling’s impact on the
landscape. One often-overlooked concern is lack of legal protection
available to surface owners who have placed their property under a
conservation easement, but who do not hold title to the oil and gas
beneath the property. Conservationists have discussed whether it is
appropriate to accept an easement on a property that might see drilling
activity, but have thought little about what to do if a conservation
easement already exists and an oil and gas lessee-not bound by
easement-the proposes to drill on the property. There is no existing
legal framework to deal with this situation; where case law exists, it is
often outdated and inadequate. This Note argues that, in light of this
problem, the accommodation doctrine, as articulated in Getty Oil Co. v.
Jones, represents the best prospect for protecting properties under
conservation easement. Adoption of the accommodation doctrinealready successfully employed elsewhere-in Pennsylvania and the other
Marcellus states would be a practical way to respect both surface
owners’ right to conserve their land and mineral owners’ right to extract
the resources beneath it. By requiring the balancing of multiple
considerations when dealing with use conflicts, the accommodation
doctrine can both adapt to the changing conditions in the Marcellus and
protect, to the greatest extent possible, the owners’ expectations
regarding the use of their estates.
* J.D. expected 2013, The University of Virginia School of Law; B.S. 2007, The University of
Virginia McIntire School of Commerce. I would like to thank Rick Monk of the American
Farmland Trust for introducing me to this topic. I would also like to thank Marc Anderson for his
unfailing support and helpful comments throughout this process.
2013]
Reasonable Accommodation
137
INTRODUCTION ................................................................................. 137 I. SPLIT ESTATES, CONSERVATION EASEMENTS, AND NATURAL
GAS DRILLING .......................................................................... 141 A. Anti-Drilling: Conservation Groups Finding Drilling
and Conservation Incompatible ......................................... 143 B. Pro-Drilling: Conservation Groups Embracing the
Marcellus Shale Boom ....................................................... 144 II. INROADS INTO MINERAL ESTATE DOMINANCE: THE COMMON
LAW APPROACH AND THE ACCOMMODATION DOCTRINE ......... 145 III. GO EAST, YOUNG MAN: WHY PENNSYLVANIA NEEDS THE
ACCOMMODATION DOCTRINE ................................................... 149 A. Limited Case Law and Ineffective Legislation..................... 150 B. Precedent Supporting a Broader View of Surface
Owners’ Rights ................................................................... 152 IV. PROTECTING LAND UNDER CONSERVATION EASEMENT USING
THE ACCOMMODATION DOCTRINE ............................................ 158 A. What Constitutes a “Use?”: Conservation Easements as
an Existing Use .................................................................. 158 B. “Significant Impairment:” Inherent Incompatibility of
Conservation Easements and Natural Gas Drilling .......... 161 C. Reasonable Alternatives: Horizontal Drilling and the
Existence of Non-Surface Use Leases ................................ 164 CONCLUSION .................................................................................... 166 INTRODUCTION
Natural gas production from shale formations is one of the most
rapidly expanding sources of onshore oil and gas production in the
United States.1 Improvements in two technologies, horizontal drilling
and hydraulic fracturing, have made extraction from shale formations
not only feasible, but also highly profitable.2 It has been called “one of
1 U.S. DEP’T OF ENERGY, MODERN SHALE GAS DEVELOPMENT IN THE UNITED STATES: A
PRIMER
(2009),
at
ES-1,
available
at
http://www.marcellus.psu.edu/resources/PDFs/NETLprimer.pdf. Along with natural gas derived
from tight sands and coalbed methane, shale gas is considered an “unconventional gas.” Id. at 7.
Sixty percent of the United States’ technically recoverable natural gas is unconventional, id. at 3,
making recovery from these sources an important part of the industry. Drilling in shale gas plays,
such as the Marcellus, the Barnett, the Haynesville, the Fayetteville, and the Woodford, has
significantly increased domestic natural gas production. Id. at 8, 10. Between 1998 and 2007,
production from unconventional sources in the United States increased sixty-five percent, and
now makes up almost half of all U.S. production. Id. at 8.
2 Id. at 9; John M. Smith, The Prodigal Son Returns: Oil and Gas Drillers Return to
Pennsylvania with a Vengeance, Are Municipalities Prepared?, 49 DUQ. L. REV. 1, 4 (2011)
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[Vol. 31:136
the most significant opportunities for domestic natural gas in many
years”3 and has created a gold rush-like mentality in the Northeast,
where the Marcellus Shale, the nation’s largest shale formation, lies.4
Since Range Resources drilled the first economically successful well in
Pennsylvania in 2003,5 thousands of properties have seen drilling
activity and many more landowners have signed leases for future
development. Pennsylvania has seen the majority of the activity,
although drilling has also been significant in other states, such as Ohio
and West Virginia.6 The industry’s growth has brought major energy
companies—along with money and equipment, lots of it—to the area.
For rural landowners, the boom has significant potential benefits in the
way of bonuses, delay rentals, and royalties,7 but drilling also has
attendant environmental concerns and the potential to forever alter the
landscape.
While there are many concerns associated with this drilling boom,
from the risk of groundwater contamination8 to the strain on municipal
resources,9 one often-overlooked concern is the negative impact drilling
has on the landscape, particularly in rural areas. This concern is
particularly heightened in certain instances where there are two
conflicting legal entitlements affecting the property: severed mineral
rights10 and a conservation easement granted to a third party. A
[hereinafter SMITH, The Prodigal Son]; Laura C. Reeder, Note, Creating a Legal Framework for
Regulation of Natural Gas Extraction from the Marcellus Shale Formation, 34 WM. & MARY
ENVTL. L. & POL’Y REV. 999, 1003 (2010). Recent decreases in natural gas prices have
diminished expectations somewhat. See, e.g., Mary Esch, Norse Wants to be 1st in Line for NY
Gas
Permits,
WSJ.COM
(Nov.
23,
2012
3:34
PM),
http://online.wsj.com/article/AP18df02d4eedd4d1195d8b5b975caf175.html.
3 George A. Bibikos & Jeffrey C. King, A Primer on Oil and Gas Law in the Marcellus Shale
States, 4 TEX. J. OIL GAS & ENERGY L. 155, 156 (2008-09).
4 The Marcellus Shale formation covers over 95,000 square miles and six states. U.S. DEP’T
OF ENERGY, supra note 1, at 21; see also Ernest E. Smith, The Growing Demand for Oil and Gas
and the Potential Impact upon Rural Land, 4 TEX. J. OIL GAS & ENERGY L. 1, 4 (2008)
[hereinafter SMITH, The Growing Demand]; SMITH, The Prodigal Son, supra note 2, at 4.
5 U.S. DEP’T OF ENERGY, supra note 1, at 21.
6 New York has the potential for significant natural gas activity, but there has been a de facto
moratorium on drilling while the state’s Department of Environmental Conservation conducts an
environmental review. Esch, supra note 2. The Department is expected to issue its final report
soon. Id.
7 SMITH, The Growing Demand, supra note 4, at 25.
8 See, e.g., REEDER, supra note 2, at 1010-11.
9 See, e.g., JOINT URBAN STUDIES CTR., THE IMPACT OF MARCELLUS SHALE IN
NORTHEASTERN PENNSYLVANIA WITH AN EMPHASIS ON CHARITIES, CRIME, AND POVERTY
(2008), available at http://www.pasenatepolicy.com/MarcellusShaleHearing/ooms-1.pdf; Scott
Detrow, Emergency Services Stretched in Pennsylvania’s Top Drilling Counties, NAT’L PUB.
RADIO (Jul. 11, 2011 9:00 AM), available at http://stateimpact.npr.org/pennsylvania/2011/07/11/
emergency-services-stretched-in-pennsylvanias-top-drilling-counties/.
10 Mineral rights can be severed in two ways: by deed or via an oil and gas lease. Jason P.
Webb, Pennsylvania & Coalbed Methane: Reviving the Traditional Willingness to Protect
2013]
Reasonable Accommodation
139
conservation easement—a contract between a surface owner and a
grantee organization—cannot bind a mineral owner who was not a party
to the contract. Although the easement is a property right, its existence
has no legal effect on this third party.11
This situation is particularly relevant in Pennsylvania, where “split
estates” are widespread.12 Because of extensive oil production in the
nineteenth century, it is common for a previous owner to have severed
mineral rights from the surface estate generations ago.13 Oftentimes,
surface owners are not aware that they do not own the mineral rights to
their property.14 Even surface owners who are aware of this often did
not believe that drilling was a realistic possibility when they purchased
the land; after all, drilling the Marcellus has been going on for less than
ten years.15
Furthermore, a surface owner has few rights vis-à-vis the mineral
owner. While landowners who sever their mineral rights themselves can
negotiate for protective provisions in their oil and gas leases,16 a surface
owner whose rights have already been severed cannot. The common law
provides little protection: The mineral estate is the dominant estate and
the mineral owner has the implied right to reasonable use of the surface
in order to develop the oil and gas.17 Courts have broadly defined what
Surface Owners, 27 TEMP. J. SCI. TECH. & ENVTL. L. 35, 40 (2008). An oil and gas lease is not
like a typical “lease,” but is real property interest, a fee simple determinable in the oil and gas
with a reversionary interest in the lessor, plus an implied easement to access the surface estate for
purpose of developing the oil and gas estate. Id. at 39. In Pennsylvania, oil and gas are considered
distinct from other minerals because of their fungible nature and are conveyed by an oil and gas
lease. Id. at 38. In most other states, however, an interest in the oil and gas can be transferred via
either a lease or a general mineral deed. Id. at 40.
11 William M. Silberstein, Pitfalls Galore: Mineral Development and Conservation Easement
Tax Law, 2008 A.L.I.-A.B.A. 407, 411 (2008).
12 While this Paper will focus on Pennsylvania, the state with the most active natural gas
drilling, its ideas are equally applicable to other major Marcellus Shale states, as well as other
regions of the county where shale gas may be found.
13 Smith, The Prodigal Son, supra note 2, at 10; see also ROSS H. PIFER, THE MARCELLUS
SHALE NATURAL GAS RUSH: THE IMPACT OF DRILLING ON SURFACE OWNER RIGHTS 2 (2011),
available
at
http://law.psu.edu/_file/aglaw/
Natural_Gas/The_Marcellus_Shale_Natural_Gas_Rush-The_Impact_of_Drilling_on_
Surface_Owner_Rights.pdf (“In many instances, . . . subsurface property interests were severed
from the surface estate long before the current surface owner acquired title.”).
14 Douglas R. Hafer et al., A Practical Guide to Operator/Surface-Owner Disputes and the
Current State of the Accommodation Doctrine, 17 TEX. WESLEYAN L. REV. 47, 51 (2010);
SMITH, The Growing Demand, supra note 4, at 10; Stephan W. Saunders, Weighing the Risks and
Rewards, PA. LAWYER, at 18, 20 (Mar.-Apr. 2012).
15 See Caitlin Cleary, Mineral Rights Give Drillers Free Rein, PITTSBURGH POST-GAZETTE,
Apr. 23, 2006, at A1.
16 See, e.g., SMITH, The Growing Demand, supra note 4, at 15.
17 E.g., WEBB, supra note 10, at 40.
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is “reasonable;” the mineral owner generally has the right to choose
both the kinds of surface uses and the location of those uses.18
These broad rights, combined with the fact that conservation
easements cannot bind a third party mineral owner, create the potential
for extensive natural gas drilling on conserved properties. In certain
areas of Pennsylvania, this is already occurring.19 Land trusts and
governmental bodies have discussed whether it is appropriate to accept
a conservation easement on a property that has, or is likely to have,
natural gas drilling, but have thought little about what to do if an
easement already exists and an energy company is proposing to drill on
the property. There is no existing legal framework to deal with this
situation, as most of these areas have not seen drilling in the past
hundred years, and there is limited case law on the myriad of issues that
might arise when there is a split estate. Where case law does exist, it is
often inadequate, as drilling practices in the Marcellus differ greatly
from, and have a larger impact than, historical drilling practices.20
This paper argues that, in light of these conflicts and the legislature’s
lack of effective action, the accommodation doctrine represents the best
prospect for protecting property under conservation easements. The
accommodation doctrine, first articulated by the Supreme Court of
Texas in Getty Oil Company v. Jones,21 has made inroads into the
traditional common law distribution of rights, which strongly favored
the mineral owner, and has provided some additional protection for
surface owners. To invoke the doctrine, a surface owner generally must
show that he or she had a preexisting and necessary use of the surface
that would be significantly impaired by the mineral owner’s proposed
use, and that the mineral owner has a reasonable alternative.22 While
only one Marcellus Shale state—West Virginia—has adopted the
doctrine thus far, many Western states have.23 Other courts faced with
18 John S. Lowe, The Easement of the Mineral Estate for Surface Use: An Analysis of Its
Rationale, Status, and Prospects, 39 ROCKY MTN. MIN. L. INST. 4-1, 4-3 (1993).
19 See, e.g., Haycock Twp. Allows Property to be Leased for Drilling; Company Wants to
Search for Natural Gas on Private Farm, MORNING CALL (ALLENTOWN, PA.), Oct. 27, 2005, at
B2 [hereinafter Haycock Twp.]; Laura Legere, Preserved Farms Protected from Development but
not Gas Drilling, SCRANTON (PA.) TIMES-TRIB., Feb. 21, 2011, at 1.
20 W. VA. FARMLAND PROT., GUIDANCE ON GAS LEASES FOR FARMLAND PROTECTION
ENTITIES IN WEST VIRGINIA 1 (2009) [hereinafter GUIDANCE ON GAS LEASES], available at
http://www.wvfarmlandprotection.org/news.cfm.
21 470 S.W.2d 618 (Tex. 1971).
22 SMITH, The Growing Demand, supra note 4, at 20.
23 See Christopher M. Alspach, Surface Use by the Mineral Owner: How Much
Accommodation is Required under Current Oil and Gas Law?, 55 OKLA. L. REV. 89, 92 (2002);
Andrew M. Miller, Comment, A Journey Through Mineral Estate Dominance, The
Accommodation Doctrine, and Beyond: Why Texas is Ready to Take the Next Step with a Surface
Damage Act, 40 HOUS. L. REV. 461, 485 (2003); John F. Welborn, New Rights of Surface
2013]
Reasonable Accommodation
141
surface owner-mineral owner conflicts should also adopt the doctrine in
appropriate situations in order to protect surface owners’ expectations
and conform the law to modern need. In addition, these courts should
extend the doctrine to protect lands under conservation easement,
regardless of whether the surface owner also uses the land for farming
or some other positive “use” the doctrine typically recognizes. Since the
doctrine takes into consideration both parties’ interests, this would be
the most equitable way to accommodate both owners’ property rights.
Part I of this Paper provides background on the issue of drilling on
properties burdened by conservation easements and discusses the
various approaches that conservation groups have taken on the matter.
Part II briefly reviews the traditional common law approach to surfacerights disputes and discusses the accommodation doctrine. Part III
demonstrates why the accommodation doctrine is appropriate for
Pennsylvania and the other Marcellus Shale states, focusing on the
limited protections currently provided by case law and the absence of
effective legislative activity. Part III also shows that, at least in
Pennsylvania, the accommodation doctrine is consistent with early oil
and gas case law. Finally, Part IV discusses how courts should apply the
accommodation doctrine to protect lands under conservation easement
and why it should be applied in this manner. Part IV argues that (1)
conservation easements should qualify as an “existing use” under the
accommodation doctrine because they are a voluntary employment of
the land by the landowner and because their legally binding nature
precludes alternative uses; (2) the potentially adverse impacts of natural
gas drilling in the Marcellus, above and beyond those associated with
conventional drilling, make it inherently incompatible with conserved
lands and satisfy the requirement that there be a significant impairment
of the surface owner’s use by the mineral owner; and (3) the widespread
usage of horizontal drilling and the feasibility of “no surface impact”
leases indicates that there will be, in most instances, alternative methods
by which a mineral owner can access the natural gas beneath the
conserved property.
I. SPLIT ESTATES, CONSERVATION EASEMENTS, AND NATURAL GAS
DRILLING
Historically, natural gas drilling was often allowed on land under
conservation easement, unless the activity made excessive use of the
surface or was expressly prohibited by an agreement by both the surface
Owners: Changes in the Dominant/Servient Relationship Between the Mineral and Surface
Estates, 40 ROCKY MTN. MIN. L. INST. 22-1, 22-23 (1994).
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owner and mineral owner.24 The Internal Revenue Code specifies that,
to qualify for a deduction, a conservation easement must have been
donated “exclusively for conservation purposes.”25 Such purposes
include public recreation, ecosystem protection, preservation of open
space (including farmland), and preservation of historically important
areas or buildings.26
Surface mining is generally prohibited on land for which the taxpayer
has received a deduction. Under the Code, if the donor retains a
“qualified mineral interest,” including oil and gas rights, and surface
mining may occur on the property, then the donation is considered not
“exclusively for conservation purposes.”27 If the surface and mineral
estates were separated prior to June 13, 1976, however, it is sufficient if
“[t]he probability of extraction . . . by any surface mining method is so
remote as to be negligible.”28 This exception exists because, as
discussed previously, the mineral owner is not bound by any agreement
between the surface owner and a conservation organization.29
However, it appears that these prohibitions may not bar the natural
gas extraction. First, the Treasury Regulations explicitly state that,
despite the general prohibition on surface mining, a deduction may be
allowed if the mining method has a “limited, localized impact” and is
“not irremediably destructive of significant conservation interests.”30 In
an example accompanying this regulation, a deduction was allowed
when the surface owner promised that the drilling for oil and gas would
only have a “temporary localized impact” and not interfere with the
easement’s conservation purpose.31
In addition, there is some guidance suggesting that natural gas
drilling may not be prohibited because it does not qualify as “surface
mining.” In addition to the regulation above, the Internal Revenue
Service, in several private letter rulings, has allowed retention of oil and
gas rights when the donor promises that the drilling will have only a
24 See, e.g., I.R.C. § 170(f)(3)(B)(iii), (h) (2006); GUIDANCE ON GAS LEASES, supra note 20,
at 1. While state statutes authorize conservation easements, see Melinda M. Beck, New West
Conservation Agreements and Oil and Gas Development, in SURFACE USE FOR MINERAL
DEVELOPMENT IN THE NEW WEST 10-1, 10-2 (Rocky Mtn. Min. L. Inst. ed., 2008), federal tax
provisions actually have a greater impact on the form of these easements and the extent to which
development activities are permissible.
25 I.R.C. § 170(h)(1)(C); see also SILBERSTEIN, supra note 11, at 410.
26 See I.R.C. § 170(h)(4).
27 Id., I.R.C. § 170(h)(5)(B)(i); see also SILBERSTEIN, supra note 11, at 411.
28 § 170(h)(5)(B)(ii); Treas. Reg. § 1.170A-14(g)(4)(ii) (2012); see also BECK, supra note 24,
at 10-9.
29 SILBERSTEIN, supra note 11, at 411.
30 Treas. Reg. § 1.170A-14(g)(4)(i) (1986).
31 Id. § 1.170A-14(g)(4)(iii).
2013]
Reasonable Accommodation
143
localized impact.32 Several commentators agree that, under the current
interpretation of § 170(h), some natural gas development can occur on
conserved properties, at least when there are promises of only localized
impacts and subsequent reclamation.33 In addition, the larger the
property, the more likely it is that any drilling will be considered
“localized.”34 Whether this is appropriate given the increased impacts of
the drilling methods used in the Marcellus is highly questionable.35
Nonetheless, it is apparent that there is no per se prohibition on natural
gas drilling.
A. Anti-Drilling: Conservation Groups Finding Drilling and
Conservation Incompatible
Given this lack of outright prohibition, conservation organizations are
struggling to develop their own stances on the issue. At least two
organizations have decided that natural gas drilling is essentially
incompatible with land conservation. The Delaware Highlands
Conservancy has stated that, “the advance of pervasive industrial
activity, such as drilling for natural gas in the Marcellus Shale
formation, is not compatible with our goals.”36 The organization has
decided not to accept conservation easements on properties subject to an
oil and gas lease or where the owner retains the right to sign such a
lease.37 Only if the land is “exceptionally important,” and there are
assurances that “the drilling will have no impacts” (presumably
meaning a “no surface rights” lease) is the organization likely to
consider accepting the easement.38 The West Virginia Farmland
Protection Board also adheres to a strict interpretation of the IRS’s
guidelines. County boards under its jurisdiction cannot accept
easements unless severed mineral rights are repurchased or subordinate
to the easement, or the likelihood of extraction is “so remote as to be
negligible.”39 This is largely because the federal Farm and Ranch Lands
32 See, e.g., I.R.S. Priv. Ltr. Rul. 82-47-024 (Aug. 18, 1982); I.R.S. Priv. Ltr. Rul. 84-28-037
(Apr. 6, 1984); I.R.S. Priv. Ltr. Rul. 87-13-018 (Dec. 23, 1986).
33 See DAVID J. DIETRICH & CHRISTIAN DIETRICH, CONSERVATION EASEMENTS: TAX AND
REAL ESTATE PLANNING FOR LANDOWNERS AND ADVISORS 35 (2011); BECK, supra note 24, at
10-9; SILBERSTEIN, supra note 11, at 412-13.
34 DIETRICH & DIETRICH, supra note 33, at 36.
35 See LEGERE, supra note 19.
36 DEL. HIGHLANDS CONSERVANCY, GUIDELINES FOR DECISIONS INVOLVING NATURAL GAS
LEASES
1
(2011)
[hereinafter
GUIDELINES FOR DECISIONS],
available
at
http://www.delwarehighlands.org/files/dhcadmin/GasGuidelines.pdf.
37 See infra Section IV.C.
38 GUIDELINES FOR DECISIONS, supra note 36, at 1.
39 GUIDANCE ON GAS LEASES, supra note 20, at 1.
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Protection Program,40 which does not allow oil or gas drilling, funds
many of the Board’s easements.41 The organization’s guidance suggests
that it may be acceptable for owners to sign leases allowing energy
companies to drill horizontally underneath their land, as long as no
drilling or infrastructure is present on the property.42
B. Pro-Drilling: Conservation Groups Embracing the Marcellus Shale
Boom
Conversely,
other
organizations—particularly
those
in
Pennsylvania—have done as much as they possibly can to promote
drilling on lands under conservation easement. The Pennsylvania
Farmland Protection Program, unlike its counterpart in West Virginia,
explicitly allows natural gas drilling on properties for which it holds
conservation easements.43 Furthermore, the program does not place any
significant limitations on the energy companies’ activities, allowing
them to construct roadways, pipelines, and other infrastructure as
needed.44 In Lackawanna County, this permissiveness has led to natural
gas leases on forty-one of the county’s farms under conservation
easement.45 On one such farm, the property owners signed an easement
in 2002, and then signed an oil and gas lease in 2007.46 During permit
hearings, it was discovered that the lessee was not even aware that there
was a conservation easement on the property.47 Furthermore, there
seems to be little concern about modifying conservation easements to
allow for natural gas drilling. In Haycock, Pennsylvania, a landowner
donated an easement to the township, and later signed an oil and gas
lease.48 The township’s zoning ordinance allowed natural gas drilling on
properties under conservation easement, but this specific easement did
The Farm and Ranch Lands Protection Program is a U.S. Department of Agriculture
program that provides matching funds for the acquisition of conservation easements. DIETRICH &
DIETRICH, supra note 33, at 203.
41 See Letter from Kevin Wickey, State Conservationist, Natural Res. Conservation Serv., to
Roy Milleson, Board Member, Hampshire Cnty. Farmland Prot. Board (Nov. 26, 2008), available
at
http://www.wvfarmlandprotection.org/downloads/NRCSlettertoHCFBregaspolicy11-2608.pdf.
42 Id.
43 PA. DEP’T OF AGRIC., 2009 FARMLAND PRESERVATION ANNUAL REPORT 7 (2009),
available at http://www.agriculture.state.pa.us; LEGERE, supra note 19.
44 PA. DEP’T OF AGRIC., supra note 43, at 7; LEGERE, supra note 19.
45 LEGERE, supra note 19.
46 Id.
47 Id.
48 Haycock Twp., supra note 19.
40
2013]
Reasonable Accommodation
145
not.49 The township decided to modify the easement, rather than enforce
its provisions.50
Even if the decision to allow drilling might be questionable in this
situation, in many cases, these organizations’ decisions are irrelevant if
the mineral rights have already been severed. As discussed earlier, in
the case of previously severed mineral rights, a conservation easement
will not bind the mineral owner. The situations considered by these
organizations were quite different: they have only considered whether to
accept an easement with severed mineral rights or whether to allow the
owner of an already conserved property to sever his mineral rights.
None of them has addressed the situation of what to do when a property
already under a conservation easement is threatened with drilling
because the mineral rights were severed long before the surface owner
donated the conservation easement. This situation is legally much more
challenging and as of yet unresolved.
II. INROADS INTO MINERAL ESTATE DOMINANCE: THE COMMON LAW
APPROACH AND THE ACCOMMODATION DOCTRINE
Under the common law, an oil and gas lessee has an implied right to
use the land as is reasonably necessary for “exploring, drilling,
producing, transporting, and marketing” the product.51 For all these
activities, a lessee can choose both the method of use and the location of
the activity, as long as it falls within a broad definition of
“reasonable.”52 In addition to drilling and constructing related
infrastructure, the lessee can engage in harmful activities such as
destroying crops,53 disposing of wastes,54 and using both surface and
subsurface water.55 Furthermore, a lessee is not required to compensate
the surface owner for these damaging activities;56 he is only liable for
excessive surface use (a notoriously difficult thing to prove, given the
broad definition of reasonableness), negligence, or violations of express
Id.
Id. (“Because the easement agreement granted to the township was worded not to allow any
kind of mining activity, we had to give him relief to move forward.”). It is questionable whether
the township’s action was legally appropriate; however, because the lease in question still limited
surface activity, the township’s actions would likely withstand a challenge.
51 SMITH, The Growing Demand, supra note 4, at 4; see also Harper Estes & Douglas Prieto,
Contracts as Fences: Representing the Agricultural Producers in an Oil and Gas Environment,
73 TEX. B.J. 378, 379 (2010); WEBB, supra note 10, at 40.
52 LOWE, supra note 18, at 4-3; WEBB, supra note 10, at 40.
53 LOWE, supra note 18, at 4-4.
54 Id.
55 SMITH, The Growing Demand, supra note 4, at 9.
56 Id. at 3-4.
49
50
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contractual obligations.57 If a dispute arises, the lessee almost always
wins.58
If a surface owner also owns the mineral rights, and chooses to part
with them via an oil and gas lease, he or she can limit the lessee’s
implied rights through express contract provisions. Common provisions
in such situations include restricting operations to certain portions of the
property, requiring approval of well sites, prohibiting certain types of
uses, and requiring reclamation.59 Alternatively, the surface owner may
be able to negotiate a “no surface rights” lease, in which the lessee
would have the right to extract the oil and gas, but not the right to
undertake any drilling or auxiliary activities on the property. The lessee
would be limited to accessing the oil using horizontal or directional
wells drilled on adjoining properties.60 Conservation groups that have
addressed the issue of natural gas drilling often strongly advocate these
types of leases, and provide specific suggestions as to provisions that
should be in such contracts.61
In contrast, those who do not have title to the mineral estate in the
first place cannot take advantage of these protections. A mineral estate,
once severed, will pass through a separate chain of title from the
surface, creating the potential for conflicts between the owners when
drilling activity is proposed.62 In this situation, it is rare that the mineral
owner will have negotiated for any protections for the surface owner,63
who is not otherwise “afforded meaningful protection from the law.”64
In fact, an oil and gas lessee generally does not even need to notify the
surface owner before starting operations.65 In some interpretations of the
parties’ relative rights, a surface owner may only be able to use the land
to the extent that this use does not interfere with the lessee’s proper uses
once drilling operations begin.66
Because of the harshness of the common law, there have been
legislative, judicial, and political efforts to cut back on lessees’
WELBORN, supra note 23, at 22-24.
LOWE, supra note 18, at 4-7.
59 PIFER, supra note 13, at 3-4; SMITH, The Growing Demand, supra note 4, at 15.
60 PIFER, supra note 13, at 1-2.
61 See, e.g., GUIDANCE ON GAS LEASES, supra note 20, at 6-7.
62 See, e.g., WEBB, supra note 10, at 37 (“The problem of uncompensated damages ultimately
derives from American laws that allow property owners to sever valuable portions of their
land.”).
63 PIFER, supra note 13, at 2; see also BECK, supra note 24, at 10-11. (“[I]n many split estate
situations, the mineral estate is severed long before a conservation easement is donated. A
landowner has no ability to set the terms of the mineral development unless the owner of the
mineral estate agrees to enter into an agreement to restrict development.”).
64 WEBB, supra note 10, at 41.
65 SMITH, The Prodigal Son, supra note 2, at 10; see also LOWE, supra note 18, at 4-3.
66 WELBORN, supra note 23, at 22-14.
57
58
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traditional dominance.67 Judicially, the accommodation doctrine, first
articulated in Getty Oil Company v. Jones,68 and also known as “due
regard” or the doctrine of alternative uses,69 has provided some
protection for surface owners. In Getty, the surface owner, Jones, sued
for an injunction to prevent Getty from installing pumping units that
interfered with his automatic irrigation sprinkler system.70 Jones’s
irrigation system could navigate around objects less than seven feet in
height, but Getty’s two pumps were seventeen and thirty-four feet high,
respectively.71 Two other lessees had installed similar pumps, but in
concrete cellars, as to not interfere with the irrigation system.72 The
Court restated the common law view, but then held that:
[W]here there is an existing use by the surface owner which would
otherwise be precluded or impaired, and where, under the established
practices of the industry there are alternatives available to the lessee
whereby the minerals can be recovered, the rules of reasonable usage of
the surface may require the adoption of an alternative by the lessee.73
Under this test, reasonableness involves considering both the surface
owner’s and the mineral lessee’s needs, although the surface owner has
the burden of proving the “unreasonableness of the lessee’s surface use
in this light.”74 The reasonableness inquiry established by Getty is
different from that of the common law because it takes into
consideration the surface owner’s uses.75 Although the court remanded
the case,76 it suggested that the doctrine’s elements were satisfied here.
First, the court noted that the irrigation system was “most
advantageous” to Jones: “perhaps the only reasonable means of
developing the surface for agricultural purposes.”77 Second, subsurface
hydraulic pumps provided a reasonable alternative by which Getty
could still extract the oil; the fact that these pumps would cost more did
not render them an unreasonable alternative.78
Id.
470 S.W.2d 618 (Tex. 1971).
69 ALSPACH, supra note 23, at 92.
70 470 S.W.2d at 619.
71 Id. at 620.
72 Id.
73 Id. at 622.
74 Id. at 627.
75 470 S.W.2d at 627 (“The reasonableness of the method . . . may be measured by what are
usual, customary, and reasonable practices in the industry under like circumstances of time, place,
and servient estate uses.”) (emphasis added).
76 Id. at 623.
77 Id. at 622.
78 Id.
67
68
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Since Getty, several other states have adopted the accommodation
doctrine, including Alaska, Arkansas, Colorado, New Mexico, Utah,
West Virginia, and Wyoming.79 While the doctrine varies slightly by
jurisdiction, it generally requires a surface owner to show that (1) the
land is subject to an existing use, (2) the proposed use by the lessee
would “prevent or significantly impair that use,” and (3) a reasonable
alternative is available to the lessee.80 Whether or not the doctrine
applies will depend on findings of fact.81
It is not enough that the owner simply have an existing use for the
land. Rather, “the surface owner must show that any alternative uses,
other than the existing use, are impracticable and unreasonable under all
the circumstances.”82 Although it is not necessary that the existing use
have been in place when the mineral estate was severed, it must have
existed at the time the mineral owner proposed its new use.83 The
doctrine usually will not apply if the use is only speculative,84 although
a Texas court applied the doctrine in a case where the surface owner had
registered the land for landfill use, but had not actually started dumping
there.85
If there is an existing surface use, a court will determine whether
there is a reasonable alternative to the lessee’s proposed use by
considering the usual and customary practices in the industry.86 While
courts still appear to defer somewhat to the lessee in determining what
is reasonable,87 reasonableness here also depends on the surface use. For
example, “[w]hat might be a reasonable use . . . on a bald prairie used
only for grazing . . . could be unreasonable within an existing residential
area . . . or in the middle of an irrigated farm.”88 Under the
accommodation doctrine, the court “cannot ignore the condition of the
surface and the uses then being made by the servient surface owner.”89
ALSPACH, supra note 23, at 92; MILLER, supra note 23, at 485.
SMITH, The Growing Demand, supra note 4, at 20; see also NANCY SAINT-PAUL, 4
SUMMERS OIL AND GAS § 40:2 (3d ed. 2011); HAFER ET AL., supra note 14, at 59.
81 ESTES & PRIETO, supra note 51, at 380.
82 HAFER ET AL., supra note 14, at 61.
83 SMITH, The Growing Demand, supra note 4, at 20.
84 HAFER ET AL., supra note 14, at 60-61 (citing Amoco Prod. Co. v. Thunderhead Invs., 235
F.Supp.2d 1163, 1173 (D. Colo. 2002))
85 Texas Genco, LP v. Valence Operating Co., 187 S.W.3d 118, 124-25 (Tex. App. 2006).
86 Id. at 23; see also HAFER ET AL., supra note 14, at 64.
87 See ALSPACH, supra note 23, at 108; see also LOWE, supra note 18, at 4-12 (“The
accommodation doctrine is best understood as a specific application of the general limitation that
surface use under the implied easement must be reasonable . . . . “).
88 Getty Oil Co. v. Jones, 470 S.W.2d 618, 627 (Tex. 1971).
89 Id. at 627-28.
79
80
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In Texas, an alternative use will only be reasonable if it takes place
on the same property,90 which would preclude horizontal drilling
underneath the surface from another property, but this is not the case in
all jurisdictions. At least one commentator has claimed that this
limitation is “logically unnecessary;” as long as the mineral owner can
still make use of the minerals, it should not matter where the mineral
owner’s point of access is.91
Of the Marcellus Shale states, West Virginia is so far the only one to
adopt the accommodation doctrine. In Buffalo Mining Company v.
Martin, the West Virginia Supreme Court of Appeals, citing Getty, held
that “a right to surface use will not be implied where it is totally
incompatible with the rights of the surface owner.”92 While a court will
construe express rights according to the language in the deed or lease,
“where implied as opposed to express rights are sought, the test of what
is reasonable and necessary becomes more exacting.”93 In such a case,
“it must be demonstrated not only that the right is reasonably necessary
for the extraction of the mineral, but also that the right can be exercised
without any substantial burden to the surface owner.”94 Unlike the court
in Getty, the Buffalo Mining court held that the mineral owner, not the
surface owner, has the burden of proving that the proposed use is
reasonable.95 Since the court found that the agreement’s express terms
gave the mineral owner the rights he was seeking, and because the
plaintiff had not raised the issue at the trial level, the court chose not to
decide “the factual issues of undue burden and reasonable necessity.”96
III. GO EAST, YOUNG MAN: WHY PENNSYLVANIA NEEDS THE
ACCOMMODATION DOCTRINE
Although the Marcellus Shale states other than West Virginia have
not adopted the accommodation doctrine, at least partially because they
may not yet have been presented with the opportunity, such a judicial
development would help alleviate the increasing number of conflicts
between surface owners and oil and gas lessees. Since the need to
resolve these conflicts is most pressing in Pennsylvania, due to its
ALSPACH, supra note 23, at 104; HAFER ET AL., supra note 14, at 63.
LOWE, supra note 18, at 4-13.
92 Buffalo Mining Co. v. Martin, 267 S.E.2d 721, 722, 725 (W.Va. 1980). However, the
mineral owner prevailed in the litigation because the court found that the language of the
severance deed was broad enough to allow the mineral owner to construct the electric line in
question.
93 Id.
94 Id. at 725-26 (citing Getty, 470 S.W.2d 618).
95 See id.; ALSPACH, supra note 23, at 92.
96 Buffalo Mining Co., 267 S.E.2d at 725-26.
90
91
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outdated case law and extensive drilling activity, this paper will discuss
why adoption of the accommodation doctrine is both necessary and
appropriate in that state. It is necessary because the limited case law that
exists is primarily from the nineteenth century, and the legislature’s
myriad of efforts to adapt the law to modern needs have been a dismal
failure. It is appropriate because a close examination of earlier cases
show that the accommodation doctrine is consistent with the state’s
precedent, despite modern cases endorsing the traditional view. In fact,
as will be discussed further, accommodation is more consistent with the
line of thinking articulated in older cases than is the “traditional view.”
A. Limited Case Law and Ineffective Legislation
Despite Pennsylvania’s history with oil and gas production—oil
production began in the state in 1869, and, in 1871, the state became
home to the first Oil Exchange97—it did not see much drilling activity
during the twentieth century, when drillers moved west.98 As such, most
applicable case law is close to or over a century old and based on
different extraction technologies.99 For example, a case from 1893 is
still cited regarding surface disputes.100 This case acknowledges that the
law must adapt to new technologies. The court’s cautionary language
that “[t]he discovery of new sources of wealth, and the springing up of
new industries which were never dreamed of half a century ago,
sometimes present questions to which it is difficult to apply the law, as
it has heretofore existed,” is as equally applicable today as it was
then.101 Despite a plethora of new legal questions, only recently has the
Pennsylvania Supreme Court started to revisit its oil and gas
jurisprudence.102 The acceptance of these cases holds the potential for
the state to begin to adapt its mineral law to accord with modern needs,
but, as of now, courts must make decisions based on law developed for
a very different industry at a very different time.
97 SMITH, The Prodigal Son, supra note 2, at 3. In the late 1880s, the state saw an oil boom not
unlike the natural gas boom today. Like the 2003 Range Resources well in the Marcellus, one
well, drilled by “Colonel” Edwin Drake, started the boom. Id. Its commercial success led to an
explosion of wells, towns, railroads, and supporting industries. Id. At one point, Pennsylvania was
producing half the world’s oil. Id.
98 Id. at 3-4.
99 See BIBIKOS & KING, supra note 3, at 171.
100 See Chartiers Block Coal Co. v. Mellon, 25 A. 597 (Pa. 1893).
101 Id. at 598.
102 See, e.g., Butler v. Charles Powers Estate, 29 A.3d 35 (Pa. Super. Ct. 2011), appeal
granted, 41 A.3d 854 (Pa. 2012); Sophia Pearson & Mike Lee, Pennsylvania High Court Takes
Appeal on Marcellus Shale Rights, BLOOMBERG BUSINESSWEEK (Apr. 5, 2012), available at
http://www.businessweek.com/news/2012-04-05/pennsylvania-high-court-takes-appeal-onmarcellus-shale-rights.
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Reasonable Accommodation
151
On the legislative side, the main statutory provision governing oil and
gas extraction in Pennsylvania is the Oil and Gas Act, enacted in
1984,103 twenty years before Range Resources drilled the first
economically productive well in the Marcellus. The first major
amendment to this statute came just this year when the Pennsylvania
Legislature enacted “Act 13.”104 This amendment, which is causing a
great deal of controversy, establishes an “impact fee” for every well
drilled in the Marcellus.105 Administration and collection is on the state
level, but each county can choose whether to impose the fee on wells in
its jurisdiction.106 The Act also sets some new restrictions on drilling,
including increasing the well setback from 200 to 500 feet for buildings
and from 200 to 1000 feet for water wells.107 However, counties must
allow drilling in all zoning areas108 and cannot enact any local
regulations that are stricter than those the Act provides.109 In addition,
the Act creates a private right of action against municipalities that enact
drilling restrictions.110 The law has been called “the most antidemocratic, anti-environmental law in the country”111 and “a legal
blueprint for the environmental destruction of Pennsylvania.”112 Since
the law’s passage, seven municipalities have banded together and sued
the state, claiming the act is an “improper and arbitrary use of the
Commonwealth’s police power.”113
Pennsylvania’s ill-advised new law is especially startling considering
that most state legislatures are moving in the opposite direction, and are
instead implementing surface damage acts that decrease mineral owner
1984 Pa. Laws. 1140.
2012 Pa. Legis. Serv. 13 (West); 58 PA. CONS. STAT. §§ 2301 et seq. (2012).
105 Id. § 2302.
106 Id.; see also State Impact, What the New Impact Fee Law, Act 13, Means for Pennsylvania,
NAT’L PUB. RADIO, available at http://stateimpact.npr.org/pennsylvania/tag/impact-fee/ (last
visited Apr. 7, 2012).
107 § 3215(a).
108 Id. § 3304.
109 Id. § 3302.
110 Id. § 3306. If a municipality prohibits drilling in any zoning district or otherwise imposes
stricter regulations, it will lose its revenues from the impact fee, State Impact, supra note 106, and
any driller affected by such an ordinance is expressly authorized to sue the municipality. § 3306.
111 Steven Rosenfeld, Fracking Democracy: Why Pennsylvania’s Act 13 May Be the Nation’s
(Mar.
7,
2012),
available
at
Worst
Corporate
Giveaway,
ALTERNET
http://www.alternet.org/environment/154459/fracking_democracy%3A_
why_pennsylvania%27s_act_13_may_be_the_nation%27s_worst_corporate_giveaway.
112 Edward Smith, Act 13: A Disaster for PA Home and Property Owners, WAYNE INDEP.
(Honesdale, Pa.), Feb. 29, 2012, at 4.
113 Petition for Review at 7, Robinson Twp. v. Commonwealth, No. 284 MD 2012 (Pa.
Commw. Ct. Mar. 29, 2012); see also Scott Detrow, Municipalities Files Anti-Impact Fee
Lawsuit, NAT’L PUB. RADIO (Mar. 29, 2012, 5:13 PM), available at
http://stateimpact.npr.org/pennsylvania/2012/03/29/municipalities-file-anti-impact-fee-lawsuit/.
103
104
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and lessees’ power. States that have enacted surface damage acts
include North Dakota, Montana, Oklahoma, Tennessee, and West
Virginia.114 Although Pennsylvania is arguably one of the states that
most needs such an act, due to the natural gas industry’s rapid growth
and the state’s extensive amount of land devoted to agricultural uses,115
surface damage acts have failed every time they have been introduced in
the legislature.116
West Virginia’s surface damage act provides compensation to surface
owners for (1) lost income or expenses incurred as the result of being
unable to access land occupied by the driller, (2) the market value of
destroyed or damaged crops, (3) any damage to any in-use water supply,
(4) the cost of repairs to personal property (up to their value), and (5)
the diminution in value of the surface estate.117 All, or most, of these
would not be compensable under the common law. Pennsylvania
citizens and surface owners would be better off with such an act, but the
number of failed attempts and the strikingly contrary Act 13 indicate
that this is not a realistic probability. Thus, the accommodation doctrine
may presently be surface owners’ best chance of protecting their
interests.
B. Precedent Supporting a Broader View of Surface Owners’ Rights
Despite the fact that, in recent years, Pennsylvania case law has
adhered closely to the common law view, and left surface owners with
few or no rights, early precedent supports a more nuanced view of the
owners’ respective rights. While the factual situations underlying these
older cases are different in some important aspects from modern cases,
primarily because of technological developments, their underlying
principles show that it would be entirely consistent for the state
judiciary to take into consideration a surface owner’s use of the land
when resolving a use conflict today.
Two recent cases, Belden & Blake Corporation v. Commonwealth118
and Minard Run Oil Company v. United States Forest Service (Minard
LOWE, supra note 18, at 22-18.
While surface damage acts provide all owners with certain protections, they are generally
enacted with agricultural uses in mind. LOWE, supra note 18, at 22-17 to 22-18.
116 See H.R. 2533, 2007-08 Reg. Sess. (Pa. 2008), H.R. 2227, 2007-08 Reg. Sess. (Pa. 2008),
H.R. 473 2009-10 Reg. Sess. (Pa. 2009).
117 W. VA. CODE §§ 22-6B-3, 22-7-3 (2002); WELBORN, supra note 23, at 22-17 to 22-18.
The provision providing compensation for the land’s diminution in value is the most controversial
because, arguably, the land is already devalued because of the severed surface estate (or if it is
not, should be). Id. This theory, while it may have legal and economic validity, does not seem to
reflect people’s expectations.
118 969 A.2d 528 (Pa. 2009).
114
115
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Reasonable Accommodation
153
II),119 illustrate Pennsylvania’s mistaken adherence to the common law
distribution of rights. In Belden & Blake, the owner/lessee of several
parcels of oil and gas rights in Oil Creek State Park sought a declaration
stating that the state’s Department of Conservation and Natural
Resources (“DCNR”) had no right to impose a “coordination
agreement” on the company prior to granting access to the surface.120
Belden & Blake asserted that its right to use the surface was only
limited by “a good faith requirement that it use the surface area only in a
reasonably necessary manner to extract the minerals.”121 In discussing
the applicable law, the court cited extensively to Chartiers Block Coal
Company v. Mellon, the state’s leading case on surface disputes:
[A]n owner of an underlying estate . . . has the right to go upon the
surface in order to reach the estate below, “as might be necessary to
operate his estate,” and “[t]his is a right to be exercised with due regard
to the owner of the surface, and its exercise will be restrained, within
proper limits, by a court of equity.”122
Despite noting that Chartiers requires the “difficult balancing”
necessary to protect all the owners’ rights,123 the Pennsylvania Supreme
Court agreed with the trial court that the DCNR had no right to
condition Belden & Blake’s exercise of its rights as the mineral
owner.124 The court did not engage in any sort of balancing, only made
the most minimal inquiry into reasonableness, and essentially ignored
the “due regard” component of Chartiers. According to the court,
Belden & Blake “facially fulfilled” its obligation to be reasonable in its
surface use, although it did not give its reasons for this conclusion.125
Instead, the court opted to defer to the mineral owner on the issue of
reasonableness. While this is entirely in accord with the common law’s
deference to mineral owners as to what constitutes a reasonable use,126
this analysis is not faithful to the precedent the court claimed to be
applying.
In Minard II, the United States District Court for the Western District
of Pennsylvania, albeit in dicta, similarly construed Chartiers as
recognizing expansive rights for dominant estate holders, regardless of
119
2009 U.S. Dist. LEXIS 116520 (W.D. Pa. Dec. 15, 2009), aff’d, 670 F.3d 236 (3d Cir.
2011).
969 A.2d at 529.
Id.
122 Id. at 532 (emphasis added) (quoting Chartiers Block Coal v. Mellon, 25 A. 597, 598 (Pa.
1893)).
123 Id. at 531 (citing Appellant’s Brief at 16, 17, Belden & Blake, 969 A.2d 528 (Pa. 2009)).
124 Id. at 530.
125 969 A.2d at 532.
126 See ALSPACH, supra note 23, at 108.
120
121
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any requirement of “due regard.”127 Although the case at hand dealt with
a settlement between the U.S. Forest Service and environmental
groups,128 a previous iteration of the dispute, United States v. Minard
Run Oil Company (Minard I), held that Minard Run Oil Company, the
owner of the mineral rights in portions of the Allegany National Forest,
was required to give notice to the U.S. Forest Service before
commencing drilling operations.129 Nonetheless, Minard II cited this
previous litigation for recognizing that “the mineral estate is the
‘dominant’ estate and the owner thereof has an absolute right to occupy
as much of the surface to access and extract his minerals as necessary
without the necessity of obtaining consent . . . .”130 The court recognized
that this right of absolute access is limited only by “the obligation to
exercise “due regard” for the surface owner.”131 The court further
acknowledged Belden & Blake: “The Pennsylvania Supreme Court
recently affirmed that a mineral estate owner has an absolute right to
access and extract their minerals without consent of the surface estate
owner . . . .”132 On appeal, the Third Circuit endorsed a similarly narrow
interpretation of surface owners’ rights under Pennsylvania law.133
However, Minard I’s holding was more favorable to the surface
owner than these opinions would suggest. At the heart of the dispute in
Minard I was the fact that, in order to drill wells, the oil company was
removing valuable hardwood timber from the park.134 Without advance
notice of the removal, it was difficult for the government135 to obtain a
fair sales price for the timber. Furthermore, bad weather and the oil
company’s operations prevented the government from accessing the
cleared timber.136 In its analysis, the court placed significant emphasis
on the due regard component of Chartiers, stating that a mineral owner
“must exercise [his] rights with a recognition of surface rights and
tak[e] appropriate action to prevent unnecessary disturbance to the
Minard Run Oil Co. v. U.S. Forest Serv. (Minard II), No. 09-125 Erie, 2009 U.S. Dist.
LEXIS 116520 (W.D. Pa. Dec. 15, 2009), aff’d, 670 F.3d 236 (3d Cir. 2011).
128 Id. at *1.
129 No. 80-129 Erie, 1980 U.S. Dist. LEXIS 9570, at *21-22 (W.D. Pa. Dec. 16, 1980).
130 Minard II, 2009 U.S. Dist. LEXIS at *64-65 (citing Minard I, 1980 U.S. Dist. LEXIS at
*4-6).
131 Id.
132 Id. at *64 n.3 (emphasis added).
133 Minard Run Oil Co. v. U.S. Forest Serv., 670 F.3d 236, 243-44 (3d Cir. 2011).
134 1980 U.S. Dist. LEXIS at *6-7.
135 Although the plaintiff here was the United States, this did not alter the court’s analysis. See
id. at *14-15 (“[T]he United States specifically disclaimed any intention of proceeding as a
sovereign . . . and it is obvious that the United States in this situation has no greater rights than
any other landowner having acquired title to the surface subject to the mineral rights beneath.”).
136 Id. at *10.
127
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155
owner of the surface.”137 The court stated that “[i]n other words, the
parties should attempt to reach a reasonable accommodation so that
each may reasonably enjoy his respective property rights.”138 Under this
framework, the court found that it was necessary for Minard Run to give
notice to the U.S. Forest Service prior to drilling.139 This holding cannot
be reconciled with the language in Minard II or the common law, under
which notice of the surface owner was expressly not required.
Furthermore, a study of surface rights disputes more proximate in
time to Chartiers shows that the “due regard” language was not
superfluous. While Chartiers’s articulation of “due regard” is certainly
somewhat less protective than the modern accommodation doctrine, two
cases in particular, Friedline v. Hoffman,140 and Gillespie v. American
Zinc & Chemical Company,141 indicate that equity requires courts to
consider a surface owner’s rights when faced with conflicting uses.
In Friedline, the surface owner sought an injunction to prevent the
mineral owner from using the surface to mine the underlying coal.142 In
what may be an unusual arrangement, the mineral owner had bought
five acres of the surface with the express intention of using it for mining
operations.143 The mineral owner subsequently decided that the best
location for the mine entrance was about four hundred feet away from
this plot.144 When the surface owner refused to sell this additional land,
the mineral owner entered the land and began construction.145 While it
would have been more expensive and less convenient for the mineral
owner to build the mine entrance on the five-acre parcel, it was not
impossible.146 The court acknowledged that, generally, the mineral
owner “will be entitled to such use of the surface as is necessary to
make his reservation effective . . . . [B]ut, if he owns adjoining property,
through or over which it is practically possible to mine . . . he will not
be entitled to use for that purpose the conveyed surface.”147 Thus, the
court held, the mineral owner was not allowed to use the plaintiff’s
surface for its coal operations.
137 Id. at *13; see also id. at *14 (“The easement which the mineral owner has over the surface
is not limitless and has been stated as not conferring a roving commission to subject any part of
the surface through occupation.”).
138 1980 U.S. Dist. LEXIS at *14 (emphasis added).
139 Id. at *16.
140 115 A. 845 (Pa. 1922).
141 93 A. 272 (Pa. 1915).
142 115 A. at 845.
143 Id.
144 Id.
145 Id.
146 Id. at 846.
147 Friedline, 115 A. at 846.
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As Jason Webb notes, it is possible to construct both a narrow and a
broad reading of Friedline.148 It is clear from the case that, in order for
its holding to apply at all, (1) the mineral owner must have an
alternative means of access and (2) that alternative must be
economically feasible.149 However, the implications of Friedline depend
on what qualifies as an “alternative means of access.” If narrowly
interpreted, an alternative would only exist when the mineral owner also
owns a surface parcel from which he can access the minerals.150 Under a
broad reading, which Webb advocates, it would not matter whether the
mineral owner also owned the surface where the alternative means of
access was located, as long as he had the right to access the minerals
from that alternative location.151 Because of the advent of horizontal
drilling, this broad interpretation could have significant implications for
natural gas drilling—today, it is quite common for an oil and gas lessee
to extract gas from underneath a property via a well whose vertical shaft
is located on a different parcel. While this interpretation would seem to
be broader than Friedline’s language demands, at the least, Friedline
indicates that mineral owners’ rights were not always as absolute under
Pennsylvania jurisprudence as they are today.
While Friedline has some favorable implications for surface owners,
Gillespie v. American Zinc & Chemical Company152 actually articulated
something very close to the accommodation doctrine, over sixty years
before Getty. In Gillespie, the owner of the oil and gas rights sought an
injunction to prevent American Zinc, the owner of the surface and the
coal rights, from interfering with his wells.153 Prior to the suit, Gillespie
began to drill two wells, one where American Zinc was preparing a
reservoir and another where it had begun grading the land for a
building. American Zinc responded by removing Gillespie’s materials
from those sites.154 In resolving the dispute, the court held that Gillespie
had no right to drill his wells upon those locations: “[I]n choosing
between two locations for drilling a well equally available to him, the
plaintiff was bound to choose the one that would do the least injury to
the defendant company.”155 The court articulated a narrow view of
Gillespie’s right to use the surface estate: “Possession of a small area
WEBB, supra note 10, at 48.
Id.
150 Id.
151 Id.
152 Gillespie, 93 A. 272 (Pa. 1915).
153 Id. at 272.
154 Id. at 273.
155 Id. at 273-74; see also id. at 274 (“The lessee is not at liberty to choose locations for the
drilling of wells in utter disregard of the rights of the landowner.”).
148
149
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Reasonable Accommodation
157
here and there upon a farm is all that is needed to drill the wells
necessary to get the oil, or demonstrate its absence.”156
The Gillespie court’s reasoning reflects the elements of, and the
rationale behind, the accommodation doctrine. First, it would appear
here that the land was already subject to an “existing use.” American
Zinc intended to establish a large industrial plant on the property and
mine the coal beneath to supply fuel for the plant.157 At the time
Gillespie began to drill his wells, American Zinc had begun to construct
a water reservoir and had graded the land for its contemplated
buildings.158 Even though the plant was not yet in operation, these facts
parallel those in Texas Genco, LP v. Valence Operating Company,
where the court found the surface owner’s platted landfill to be an
existing use, despite the fact that there was not yet any waste on the
site.159 Second, Gillespie’s construction of the two wells would have
“prevent[ed] or significantly impair[ed]” American Zinc’s existing use
of the surface.160 Finally, the court explicitly found that a reasonable
alternative was available to Gillespie: Had he shifted his wells a mere
150 feet, he would not have interfered with American Zinc’s operations
and his ability to obtain oil would have been “equally as good, if not
better.”161
Thus, Chartiers and its progeny—especially Gillespie—appear to
stand for a very different view of the relative rights of surface and
mineral owners than current Pennsylvania jurisprudence would suggest.
There is little in these cases to support the contention that a mineral
owner’s right to use the surface is absolute; in fact, it appears that
mineral owners were, at one point, quite constrained in their uses and
“reasonableness” was a more exacting standard. The judiciary’s
misinterpretation of its own precedent, combined with the legislature’s
unwillingness to rein in the energy companies and the need for the law
to recognize modern land uses and technology, threatens to upset the
carefully weighed balance of owners’ relative rights and devalue surface
owners’ interests in their land.
156
157
158
159
160
161
Gillespie, 93 A. at 274.
Id. at 273.
Id.
187 S.W.3d 118, 124-25 (Tex. App. 2006).
SMITH, The Growing Demand, supra note 4, at 20.
Gillespie, 93 A. at 273-74.
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IV. PROTECTING LAND UNDER CONSERVATION EASEMENT USING THE
ACCOMMODATION DOCTRINE
If Pennsylvania adopts the accommodation doctrine—as it should—
its application to lands under conservation easement would be novel. In
order for this extension of the doctrine to be successful, it must be
established that conservation easements, on their own, (1) qualify as an
“existing use;” (2) that drilling would “significantly impair” this use;
and (3) that reasonable alternative, non-interfering uses exist for the oil
and gas lessee. Although courts have only applied the doctrine when the
surface owner is making a positive “use” of the land, the choice to
conserve one’s land is an equally deliberate choice about how to use
one’s property. Furthermore, because a conservation easement limits an
owner’s potential uses of his land, the owner will not have an alternative
available use.
Courts generally address the second issue, whether there has been a
significant impairment of the surface owner’s use, on a case-by-case
basis, but it can be considered more holistically here because of the
fundamental incompatibility between conservation and drilling practices
in the Marcellus. As to the final element, the use of horizontal drilling
will often mean that a lessee can access the natural gas from an off-site
well. While there is some authority suggesting that an alternative use
must be on the same property, there is no reason to prohibit this
outcome as long as the lessee may still fully access his estate.
A. What Constitutes a “Use?”: Conservation Easements as an Existing
Use
The first element of the accommodation doctrine, that there be an
“existing use” of the surface, will likely be the most difficult for surface
owners to prove given that the uses the doctrine has historically
protected involved active employment of the land. However, there is no
logical reason why a court should treat a positive use, such as farming,
as an existing use, but find that a conservation easement on the land
does not qualify as a “use.” While the choice not to develop a parcel of
land may seem not to accord with the common understanding of the
word “use”—which suggests active employment of one’s property—the
imposition of a conservation easement is in fact an active, voluntary
decision by a landowner. When a landowner decides to place a
conservation easement on his property, he is forgoing certain alternative
“uses,” notably development. This affirmative decision and its
corresponding decision not to employ the land for other uses, sets
conservation easements apart from simple “nonuse” of the land, such as
letting it sit idle. At least for the purposes of the accommodation
2013]
Reasonable Accommodation
159
doctrine, then, courts should treat conservation easements as they do
those positive uses that have been judicially recognized.
Furthermore, there is no case law prohibiting this construction; in
fact, there is little discussion at all about what constitutes an “existing
use” for the purposes of the doctrine, other than the consideration of
whether the accommodation doctrine encompasses planned or
speculative uses of the land.162 When it comes to whether a surface
owner’s activities qualify as a use of the land, the emphasis appears to
be on positive, developmental uses. As Professor Ernest Smith notes,
courts tend to focus on physical structures, equipment, and planted
fields, not uses that do not involve the modification of the land.163
However, this may be because courts have not been squarely presented
with such an issue. Although the accommodation doctrine is over forty
years old, it is rarely invoked. A review of the case law shows that
courts have never directly found that a surface owner’s asserted, and
current, use of the land did not qualify as “use” under the
accommodation doctrine. In one case, Merriman v. XTO Energy, where
it seemed that temporary cattle pens used by the surface owner for a
once-a-year cattle roundup were not the type of “use” Getty envisioned,
the court avoided the issue, instead denying relief on the ground that the
surface owner had a reasonable alternative to the pens.164 Thus, the case
law provides little insight as to what extent there are limits on the
definition of “use.”
Even though the courts have not clearly expounded what activities
qualify as a “use,” one other requirement of the definition of a
preexisting use—that it be the only reasonable means by which a
surface owner can develop his land165—should be easily satisfied when
the “use” is a conservation easement. As the Supreme Court of Texas
stated in Getty, a surface owner must show that an alternative use on his
part is “impractical and unreasonable under all the conditions.”166 As
162 See HAFER ET AL., supra note 14, at 59-61. Compare Amoco Prod. Co. v. Thunderhead
Invs., 235 F.Supp.2d 1163, 1173 (D. Colo. 2002) (determining that the surface owner’s plans for
a subdivision constituted a “future speculative use” that was not protected by the accommodation
doctrine) with Texas Genco, LP v. Valence Operating Co., 187 S.W.3d 118, 124 (Tex. App.
2006) (finding that a platted landfill for ash from a power plant was a preexisting use).
163 SMITH, The Growing Demand, supra note 4, at 22; see also Bruce Kramer, The Legal
Framework for Analyzing Multiple Surface Issues, 44 Rocky Mtn. Min. L. Found. J. 273, 304
(2007) (noting that the factual situations in which courts have applied the accommodation
doctrine are “somewhat limited”).
164 Merriman v. XTO Energy Inc., No. 10-09-00276-CV, 2011 WL 1901987, at *4 (Tex. App.
May 11, 2011).
165 Getty Oil Co. v. Jones, 470 S.W.2d. 618, 623 (Tex. 1971); see also HAFER ET AL., supra
note 14, at 61.
166 Getty, 470 S.W.2d at 623; see also Texas Genco, 187 S.W.3d at 122.
160
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seen in Merriman, this analysis often turns on whether the surface
owner has another method by which he can carry out the same
activity.167 Reasonable alternatives will not include drastically different
uses of the land. To use Getty as an example, the question was whether
the surface owner had an alternative method of irrigating his farm, not
whether he had an alternative to farming.168 Translating this requirement
to conservation easements, the range of alternatives would seem to be
limited to other methods of achieving the easement’s stated
conservation purpose.169 While some other uses may be permissible
without destroying the overall conservation purpose,170 often
transitioning the land over to another use will result in breach of
contract, denial of all previous deductions, and possibly termination of
the easement.171 However, the law regarding extinguishment or
termination of easements is very unsettled,172 and, even if such an option
were available, it would not appear to constitute a “practical” or
“reasonable” alternative under the doctrine.
The significance of the requirement that there be no alternative
reasonable use for the surface owner will depend on how a court frames
the question. If this question precedes the analysis of “use,” or is
intertwined with it, the lack of an alternative for the surface owner could
be an independent ground for finding that lands under conservation
easement can be protected by the accommodation doctrine. This form of
analysis would provide a way around the thorny issue of whether the
conservation easement is a “use” at all. Conversely, if the question of
whether a conservation easement is a “use” precedes the question of
“alternatives,” the fact that the surface owner does not have any
alternative use of the land might carry little weight in the analysis.
Since different jurisdictions have articulated the accommodation
doctrine in subtly different ways, it is difficult to be certain in which
order the analysis might proceed. Still, to best fulfill the accommodation
doctrine’s purpose—protecting a surface owner’s right to use his land—
the question of alternatives should be considered first, or at least in
conjunction with the question of use. If there is no alternative use for a
surface owner due to a conservation easement on the land, the impact of
Merriman, 2011 WL 1901987 at *4.
Getty, 470 S.W.2d at 623.
169 See supra notes 24-26 and accompanying text.
170 DIETRICH & DIETRICH, supra note 33, at 25.
171 Id. at 187.
172 See generally Jessica E. Jay, When Perpetual is Not Forever: The Challenge of Changing
Conditions, Amendment, and Termination of Perpetual Conservation Easements, 36 HARV.
ENVTL. L. REV. 1 (2012) (providing an overview of the unsettled nature of the perpetual
conservation easement).
167
168
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Reasonable Accommodation
161
a mineral owner’s interfering operation is significant for the surface
owner regardless of whether the conservation easement formally
qualifies as a “use.” The accommodation doctrine is designed to prevent
this exact situation: the surface owner’s deprivation of his rights as a
landowner because of interference by the mineral owner.
In many situations, land under conservation easement is also
farmland, which might provide an alternative basis for some surface
owners to invoke the accommodation doctrine. There is little question
that farming qualifies as a use of the land for purposes of the doctrine.
However, there are two shortcomings with approaching the issue this
way. First, a general assertion that the land is used for farming may not
be specific enough for most courts to invoke the doctrine. The
specificity of the asserted use in cases like Getty suggests that there
needs to be a defined subset of the farming operation that is impaired in
order to invoke the doctrine. Second, not all conserved land threatened
by natural gas drilling is farmland.173 While farming is compatible with
conservation, the accommodation doctrine should protect the
easement’s conservation purpose, and not just farming activity that
happens to be on conserved land. This broader view is necessary to
protect those rural properties not used for farming, but instead
conserved as recreational space, for historic vales, or as a wildlife habit,
all of which are equally as vulnerable to natural gas drilling as farms.
B. “Significant Impairment:” Inherent Incompatibility of Conservation
Easements and Natural Gas Drilling
Once a surface owner has shown that he has an existing use for which
there are no reasonable alternatives, he must then show that this use
would be significantly impaired by the mineral owner’s proposed use.
In the case of conventional oil and gas drilling, this element might be
difficult to prove as, historically, oil and gas drilling has been
considered compatible with conservation easements, albeit under
circumscribed conditions.174 This assumption should not hold true in the
Marcellus Shale, however, as the processes used for extraction are not
comparable to the processes once found to be compatible. At the most
173 See,
e.g.,
Conservation
Easements
in
Pennsylvania,
The
Nature
Conservancy,
http://www.nature.org/about-us/private-lands-conservation/conservationeasements/conservation_easements_pennsylvania.pdf (last visited Oct. 26, 2012) (noting that
areas of timberland and wetlands are also under conservation easement). In fact, farming is a
permitted nonconservation use on these properties; the conservation easement is to protect the
property’s open space values, not its farming activity. See DIETRICH & DIETRICH, supra note 33,
at 45 (discussing how agricultural is generally a compatible nonconservation use).
174 See supra Part I.
162
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basic level, the processes used to extract the natural gas—horizontal
drilling and hydraulic fracturing—require more land and result in
greater disturbances than other types of drilling.175 There is also a
significant potential for other major environmental problems, such as
water contamination,176 interference with agricultural operations,
disruption of wildlife habitats, and destruction of unspoiled
landscapes177—all of which conservation easements seek to protect.
“[A]dvances in gas drilling production have resulted in increases in
size in almost every facet of the industry,”178 and nowhere is this more
true than at the wellpads themselves. As compared to conventional
wells, these wells require larger wellpad sites to accommodate the
extensive amount of water necessary for drilling and fracturing.179 A
wellpad will normally occupy a minimum of five acres.180 Furthermore,
a single wellpad may support multiple wells, making more space
necessary.181 A four-well site might need seven and half acres of
space,182 but some wellpads may be even larger and have up to ten
wells.183 In addition, these large wellpads are often spaced closely
together, as shale’s low permeability reduces the return on a given
well.184
Potentially even more damaging than the drilling are the auxiliary
operations of the lessee, which the common law considers “reasonable
uses” of the surface.185 Such operations include geophysical exploration,
the construction of roads, condensate tanks, compressor stations,
processing plants, and the laying of pipelines.186 These auxiliary
facilities bring their own environmental concerns, such as the diesel fuel
SMITH, The Prodigal Son, supra note 2, at 5.
See REEDER, supra note 2, at 1010.
177 SMITH, The Growing Demand, supra note 4, at 3.
178 SMITH, The Prodigal Son, supra note 2 at 5.
179 PIFER, supra note 13, at 1. The wellpad will need to include space either for a water
impoundment pond or for tractor-trailers to bring in water. Id.
180 SMITH, The Prodigal Son, supra note 2, at 6.
181 Id. Due to the use of horizontal drilling, many sites will feature multiple wells with their
horizontal shafts projecting in different directions. See Directional and Horizontal Drilling in Oil
and Gas Wells, GEOLOGY.COM, http://geology.com/articles/horizontal-drilling/ (last visited May
9, 2012).
182 U.S. DEP’T OF ENERGY, supra note 1, at 48.
183 SMITH, The Prodigal Son, supra note 2, at 6.
184 U.S. DEP’T OF ENERGY, supra note 1, at 47. In Pennsylvania, wells are being drilled
approximately every thousand feet. CLEARY, supra note 15.
185 SMITH, The Growing Demand, supra note 4, at 7-8.
186 Id. at 3; SMITH, The Prodigal Son, supra note 2, at 7. After signing a lease on his fiftythree-acre farm, one owner was surprised to the extent at which it was overrun by drilling rigs,
excavators, “swimming-pool-size” wastewater pits, and bulldozed dirt roads. CLEARY, supra note
15.
175
176
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Reasonable Accommodation
163
necessary to run the compressor pumps,187 and greatly increase the
operation’s footprint. They also add to non-surface-related impacts,
such as light, noise, and fumes.188
In addition to the impacts on the landscape itself, there is great
concern over the possibility (some might say probability) of water
contamination. Each well requires as much as five million gallons of
water during the drilling and fracturing process.189 This water may be
trucked in, but it may also be surface water or groundwater taken from
the property pursuant to the right to reasonable use.190 Often, operators
will build impoundment pits, several acres in size, to hold this water.191
There is significant apprehension about these impoundment pits
presenting a poisoning threat to farm animals,192 as well as
contaminating the land through leakage.193 A second concern is water
contamination via the drilling process itself.194 While drillers use steel
and cement casing inside the well to protect against this eventuality,195
this process is not always successful.196 Finally, all this water—some of
which will contain small amounts of radioactive material197—must be
disposed of. In the West, storing the water underground via injection
wells is popular,198 but, in the Marcellus, it is often treated and then
discharged into rivers.199
The extent of these operations—all considered “reasonable” under
existing law—is incompatible with the preservation of land. A property
with natural gas operations will be scarred with paraphernalia associated
with drilling: “the drilling rigs, the excavators, the swimming-pool-size
wastewater pits, all connected by freshly bulldozed access roads.”200
While the accommodation doctrine requires case-by-case consideration
of the issue of impairment, the situations in which conserved land and
natural gas operations are compatible should be rare. Any presumption
SMITH, The Prodigal Son, supra note 2, at 6-7.
Id. at 8.
189 Id. at 6.
190 U.S. DEP’T OF ENERGY, supra note 1, at 65.
191 Id. at 55; SMITH, The Prodigal Son, supra note 2, at 6.
192 SMITH, The Growing Demand, supra note 4, at 11-12.
193 Laura Legere, Hazards Posed by Natural Gas Drilling Not Always Underground,
SCRANTON (PA.) TIMES-TRIB., Jun. 21, 2010, at 1.
194 See REEDER, supra note 2, at 1010.
195 U.S. DEP’T OF ENERGY, supra note 1, at 51-52.
196 See, e.g., Kevin Begos, Pennsylvania Wells Had Casing Failures in Complaint Area,
WINCHESTER (VA.) STAR, Feb. 28, 2012, at B4.
197 U.S. DEP’T OF ENERGY, supra note 1, at 70. This radioactive material is known as
“naturally occurring radioactive material” (“NORM”) and comes up with water from the well. Id.
198 Id. at 68-69.
199 REEDER, supra note 2, at 1012-13.
200 CLEARY, supra note 15.
187
188
164
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of compatibility based on previous experience is inappropriate given
that it is well-established that drilling in the Marcellus is having far
from a de minimis impact on the land.
C. Reasonable Alternatives: Horizontal Drilling and the Existence of
Non-Surface Use Leases
The final element of the accommodation doctrine—that the mineral
owner must have a reasonable alternative method of extracting the
gas—might be the easiest to satisfy because of the technological
developments that have fundamentally changed the drilling process in
the Marcellus. Here, horizontal drilling presents a viable alternative for
extracting the natural gas beneath a property without disturbing the
surface.
Horizontal drilling allows an oil and gas lessee to extract natural gas
as far as 6000 feet away from the wellbore.201 Due to this extended
range, and because horizontal drilling is better suited than vertical
drilling for accessing the gas trapped in between the shale layers, lessees
are increasingly relying on this method.202 Horizontal drilling also
allows access to natural gas beneath surfaces where vertical drilling
would be impracticable or impossible, such as underneath infrastructure,
buildings, and towns.203
The feasibility and popularity of horizontal drilling has also sparked
interest in “no surface rights” leases, in which the lease agreement
permits extraction of the oil and gas beneath the surface, but prohibits
any use of the surface estate.204 While a landowner may receive smaller
payments for such a lease, and energy companies may not be interested
if the property is large (due to technical limitations on the length of
horizontal well shafts),205 such agreements are popular among
landowners and conservationists. While there is no data on how many or
what percentage of leases are “no surface rights” leases, the available
advice for landowners seeking to sign leases often suggests that an
U.S. DEP’T OF ENERGY, supra note 1, at 47.
Id. at ES-3, 46.
203 Id. at 50.
204 PIFER, supra note 13, at 3. The West Virginia Farmland Protection Board suggests the
following language: “Commercial extraction of natural gas and oil underlying the Property shall
only be permitted by the use of recovery methods utilizing horizontal and/or directional from a
surface location on lands other than the Property . . . . “ GUIDANCE ON GAS LEASES, supra note
20, at 6.
205 PIFER, supra note 13, at 3.
201
202
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Reasonable Accommodation
165
owner seek such a lease, indicating that they may be relatively
common.206
While further research would be necessary on the comparability of
drilling from a location off a property with drilling on the property to
see if it is truly an “alternative,” it appears that, in many instances,
requiring that the mineral owner access the natural gas from a well
drilled elsewhere would be a “reasonable alternative” under the
accommodation doctrine. The test of alternatives depends on the usual
and customary practices of the industry, and the fact that energy
companies are increasingly using horizontal drilling out of their own
self-interest and the fact that they have been willing (at least in some
instances) to sign “no surface rights” leases provides at least some
evidence that off-site drilling may be a reasonable alternative.
Furthermore, the comparability need not be perfect: The fact that an
alternative is more expensive will not render it unreasonable under the
doctrine.207
Although accessing a property’s natural gas from an off-premises
well is likely possible in many instances, one state—Texas—has held
that the mineral owner’s alternative must be on the leased premises.208
In Sun Oil Company v. Whitaker, Sun Oil sought a declaration enjoining
Whitaker from interfering with its use of approximately 100,000 gallons
of water per day from a supply well on the property. Whitaker crossclaimed for interference with his irrigation well.209 The court found that
Sun Oil had “the implied right to free use of so much of the water . . . as
may be reasonably necessary to produce the oil from its oil wells.”210 It
stated that Getty was inapplicable and limited its holding to situations
where the mineral’s reasonable alternative use is on the leased
premises.211 To hold otherwise “would be in derogation of the dominant
estate,” the majority claimed.212 Justice Daniel dissented; in his view,
the rationale of Getty was not limited to situations where the alternative
was on the leased premises, especially because “unitizations,
availability of fuel and water from other sources . . . , and customary
206 See, e.g., id.; GUIDANCE FOR DECISIONS, supra note 36, at 2; GUIDANCE ON GAS LEASES,
supra note 20, at 5-6.
207 See Getty Oil Co. v. Jones, 470 S.W.2d 618, 622 (Tex. 1971).
208 Sun Oil Co. v. Whitaker, 483 S.W.2d 808, 812 (1972).
209 Id. at 809.
210 Id. at 810.
211 Id. at 812.
212 Id. at 812.
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field and industry practices” indicated that off-site alternatives are often
reasonable for a mineral owner.213
No other state has followed Sun Oil, and a Texas appellate court has
suggested that its rule should not apply when conflicting surface uses, as
opposed to water uses, are at issue.214 In addition, commentators have
criticized the rule. Professor John Lowe asserts that the limitation is
“logically unnecessary,”215 while Laura Burney asserts that the decision
in Sun Oil ignores the rationale behind Getty and represents a reversion
to the common law.216 Furthermore, the alternative in Sun Oil—
purchasing water from outside sources—seems to have been less
reasonable than the alternative of horizontal drilling would be in
Pennsylvania, especially given the technique’s popularity among
drillers. Together, these factors present a strong case for Pennsylvania
not to adopt the Sun Oil rule and to instead allow for the consideration
of horizontal drilling when that alternative does not materially limit the
oil and gas lessee’s ability to extract the natural gas from beneath the
property in question.
CONCLUSION
Natural gas production from shale formations has the potential to be a
valuable source of domestic energy in the coming years, but the industry
still must overcome many legitimate concerns about drilling’s impact on
the landscape. Because the processes used to extract this gas are
significantly more invasive than conventional processes, and because of
the increasing amount of rural land burdened by conservation
easements, courts need to reconsider the allocation of property rights
between surface estate owners and mineral owners. Adopting the
accommodation doctrine—already successfully employed elsewhere—
in Pennsylvania and the other Marcellus states would be a practical way
to respect both a surface owner’s right to conserve his property and a
mineral owner’s right to extract the resources beneath it. Unlike the
213 Sun Oil Co., 483 S.W.2d at 820-21 (Daniel, J., dissenting); see also Steven John Berry,
Surface Damages in Texas: A Proposal for Legislative Intervention, 17 ST. MARY’S L.J. 121,
131-32 (1985).
214 In Valence Operating Company v. Texas Genco, LP, the court addressed the scope of Sun
Oil, despite not needing to reach the issue because the trial court had determined that Valence had
on-site alternatives to its proposed use. 255 S.W.3d 210, 217 (Tex. App. 2008). It distinguished
Sun Oil based on the use in question: Unlike in the present case, Sun Oil did not involve
conflicting surface uses, but rather whether the mineral owner was required to purchase off-site
water instead of using its well on the property. Id.
215 LOWE, supra note 18, at 4-13.
216 Laura H. Burney, A Pragmatic Approach to Decision Making in the Next Era of Oil and
Gas Jurisprudence, 16 J. ENERGY NAT. RESOURCES & ENVTL. L. 1, 65 (1996) (noting that in Sun
Oil there was “no consideration of contemporary concerns about protecting surface uses”).
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Reasonable Accommodation
167
common law, the doctrine is not one-sided, and is adaptable to different
factual situations. By requiring the balancing of multiple considerations
when dealing with use conflicts, the accommodation doctrine can both
adapt to the changing conditions in the Marcellus Shale and protect, to
the greatest extent possible, the owners’ expectations regarding the use
of their estates.