Oil and Gas at Your Door? (2005 Edition) - Earthworks

SURFACE USE AGREEMENTS
operations to be discharged or reinjected by the company. Ask for a lab analysis of the
water (from an independent lab, if possible), and then be specific about where you want the
water to be discharged or piped to avoid damages to your property. Also, retain the right to
require the operator to move the point of discharge if it is causing environmental or biological
damage (e.g., killing hay meadows, streamside vegetation, fish in the stream).
• Groundwater withdrawal from aquifers is an important issue for landowners who rely on
groundwater for livestock and for irrigation. Some gas operators have cooperated with
landowners by diverting produced water from CBM wells into stock tanks or other holding
areas for their livestock. 453 Depending upon the quality of the produced water, this may be
something to add into your SUA.
Land use issues
• Propose development alternatives that make sense in terms of your agricultural or land use
operations. For example, don’t be afraid to propose alternative routes or pump locations.
Don’t let them chop up your field with a road or pump that is better located elsewhere.
• You may want to include techniques for preventing/controlling erosion.
• Right-of-way easements. Some companies may try and get you to put this easement in their
name. It is in your best interest to do this agreement with your power company, not the oil
and gas company. 454
• When leasing land for certain facilities, e.g., compressors, you will likely lease that land by
the acre. You should be specific on the wording of this lease as to what materials are going
to be on the acreage involved. If you are not specific, companies may take advantage of it
and put as much hardware as they can on the acreage. 455
Reclamation
• Be specific about reclamation and how it should be done (e.g., you want original land contours
restored; and native vegetation planted). Include agreements on reseeding. If you so
desire, require that you be authorized to conduct and be paid for carrying out the reclamation.
• Include whether or not you want the option to convert a gas well to a water well.
• You may want to include a clause stating that the company will remain responsible for closure
and restoration of containment pits, regardless of whether the landowner uses the
produced water they hold; as well as for clean up of any hazardous materials left in the bottom
of the pits upon closure.
INDEMNIFICATION
Landowners should
be sure to request an
indemnification
clause so that they
will not be held
responsible for pollution
or other longterm
liabilities created
by the oil or gas
company. For more
information, see
number 33 of the
Sample Surface Use
Agreement later in
the chapter.
Rights and responsibilities of the company
• Look carefully at the agreement, and remove any broad language or rights granted to the
company. For example, it is common for companies to include the right to place a gas plant
on your property.
• Make sure the company is required to pay taxes on improvements (e.g., roads).
• Make sure company removes equipment when activities are completed.
• Include a damage indemnity or bond in the agreement. Most state agencies require companies
to post a bond, but often these amounts are not sufficient to ensure that wells will
be plugged and abandoned properly.
Benefits granted to the surface owner
• Some landowners have asked to be able to use parts of the well pad for parking vehicles,
trailers or equipment.
• Site-specific surface enhancement issues may also be included (e.g., new fences, new
gates/cattle guards).
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