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Mining Company Can Cross Grouse Rancher's Land: 10th Cir.

By Mark Wilson, Esq. on August 19, 2014 | Last updated on March 21, 2019

In a case from the wild prair-ee, the Tenth Circuit was called upon to figure out who owns rights to what, stemming from an almost 100-year-old mineral rights law. The Ballad of Jed Clampett this is not.

Stull is a ranching company. It runs a grouse-hunting business above ground in rural Colorado. Entek is a mineral company. It mines for minerals, oil, and other valuable underground stuff -- largely under Stull's land. Entek needed access to Stull's land in order to develop new oil well and to maintain its existing oil wells on adjacent BLM land. Stull said no; Entek's presence would disturb its grouses.

A federal district court granted Entek the right to access portions of Stull's land -- but not the right to cross over Stull's land to service its wells on BLM land.

Where Seldom Is Heard a Litigious Word...

Judge Neil Gorsuch's opinion provides a handy primer in the history of mining law. In response to land-grabbing and the fear that wealthy people would snatch up valuable land, and the valuable minerals beneath it, Congress passed the Stock-Raising Homestead Act of 1916 and the Mineral Leasing Act in 1920.

The acts provided that all underground mineral rights in federal homestead grants belonged to the government. An amendment to the Mineral Leasing Act allowed Congress to create agreements consolidating different federal mineral leases in a given area in order to more efficiently administer the leases. Profits would be distributed among the area's different leaseholders.

And The Skies Aren't Sunny All Day, Either

Stull, the one that's grousing about all this, doesn't dispute these acts or the rights that it grants to land owners and reserves for the government. What Stull does dispute is that it wasn't a party to the consolidation agreement that includes its land. This isn't a particularly good argument, and the court points out that it's not: Because the government granted the land and retains the right to reenter the land at any time, and can modify its plans for disposing of the minerals underground, the government can really do anything it wants, and it doesn't matter if Stull didn't agree to the original terms of the agreement.

The court actually went out of its way to advance an argument that Stull could have made -- that the government must compensate property owners if changes to the agreements will adversely affect the property -- but reminds us that "Stull hasn't seriously attempted any argument along these lines. If a legal argument in this area does exist, it seems it will have to come from future litigants in a future case."

The Tenth Circuit recognized what even we city-slickers know is a well-worn struggle between the holders of surface rights and subsurface rights: "But in the never-ending tug of war between ranchers and miners -- all of whom derive their interests from federal land grants -- it is for Congress to set policy and this court to construe it. If Stull seeks revisions to federal land use policy its efforts would be better directed to legislators than courts."

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