Karen J. Greenwell

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Oil and Gas Ownership and Regulation

• Karen J. Greenwell
• Wyatt, Tarrant Combs, LLP
• 250 West Main Street, Ste. 1600
• Lexington, Kentucky 40507
• [phone]

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Ownership of Real Property

• Ownership Of Real Property
• What Do You Own?
• The Bundle Of Sticks Analogy
• The Most Simple Fee Ownership One Person Owns
  All The Sticks
• Own From The Top Of The Sky To The Center Of The
  Earth. (Cujus est solum, ejus est useque ad
  coelum et ad infernos.)

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Dividing Real Property

• Vertical Divisions
• Divide A Large Tract Into Smaller Tracts
• Keep All The Sticks Just Make Each Smaller

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Dividing Real Property

• Horizontal Divisions
• Convey Different Estates Out Of The Fee
• Divide The Bundle And Separate The Sticks
• Oil /Or Gas
• Coal
• Surface
• Other Minerals

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Dividing Real Property

• Estates In Real Property Are Created By Grant Or
  Reservation
• Grant Of Minerals Leaves The Grantor With The
  Surface Estate
• The Owner Of The Minerals Can Further Divide Them
  Granting The Coal (Or Certain Seams) To One And
  The Oil And/Or Gas (Or Certain Depths) To Another

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Severed Minerals

• The Terms Of The Documents By Which Minerals Are
  Severed Control The Nature and Extent of the
  Grant
• What Minerals Were Granted Or Reserved And How
  They Are Described
• Solid Minerals
• Oil and Gas
• Coalbed Methane

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Surface Rights

• Surface Rights Appurtenant To Minerals
• Uses Of The Servient Surface To Remove The
  Dominant Minerals
• Drill Pad, Tank Area, Gathering Lines
• Portal, Haul Road, Fan Shaft
• Drill Hole Through Coal To Get To Oil Or Gas

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Ownership of Oil Gas

• Rule of Capture
• Owner of property acquires title to all the oil
  or gas produced from wells on that property,
  regardless of whether it migrated from adjacent
  lands.

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Pierson v. Post Ferae Naturae
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OIL AND GAS CONSERVATION

• Develop the resource in the most efficient and
  economical manner
• Control Well Density
• Control Proximity of Wells to Adjacent Properties
  
• Assigning acreage to a well
• Equitable sharing of oil and gas
• Ability to pool or communitize acreage
  (voluntarily and involuntarily)
• Protect the resource from wasteful or harmful
  practices
• Prevention of adverse environmental impacts

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• WELL DRILLING TECHNOLOGY
• Vertical
• Horizontal
• Directional

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Federal Regulation of Oil Gas Development

• Clean Water Act
• Addresses Discharges Into The Waters Of The
  U.S.
• Handling Of Water On The Surface
• Control Of Runoff From Work And Storage Sites
• Clean Air Act
• Addresses Emissions OF VOCs And Methane From
  Wells, Pipelines And Other Facilities

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Federal Regulation of Oil Gas Development

• Safe Drinking Water Act
• Requires Protection of Potable Water by Casing
  and Cementing Wells In Freshwater Zones
• Regulations for Wastewater Injection Wells
• Endangered Species Act
• Protects endangered plants and animals and their
  habitat

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• Oil and Gas Ownership and Regulation
• Karen J. Greenwell
• Wyatt, Tarrant Combs, LLP
• 250 West Main Street, Ste. 1600
• Lexington, Kentucky 40507
• [phone]