When one thinks of the modern oil and gas industry, few images of early railcars or railroads come to mind. With the advent of modern technology, why would a strip of abandon railroad matter to the modern energy professional or landman? Even though close to a century has passed when early Oklahoma railroads received grants or easements in order to lay tracks across the state, no one would contemplate that these conveyances would still affect mineral title to this day. The issue of whether these abandoned railroads own minerals underlying their strips is a question that oil and gas attorneys, landmen, and other energy professionals currently face in the SCOOP and the STACK, due to the amount of historical rail lines that sprawled across the Western portion of the State. Although the federal and state statutes and caselaw regarding this issue could create a lengthy article, there are some general guidelines that practitioners can generally adhere to.
If the railroad acquired its interest by a deed of conveyance, and this deed does not limit the interest that it granted, but only specified the purpose of the conveyance, the grant of the deed conveyed a fee simple interest. For example, if this deed grants all interest in the land for “railroad purposes,” but contains no other limitation, the surface and the minerals shall pass under these old conveyances. In early conveyances by deed, the largest distinction between whether the grantor of a deed conveys title in fee simple to the strip of land as opposed to conveying only an easement for railroad purposes on the surface of the land hinges almost entirely on the language of the grant. Throughout history, the Oklahoma Supreme Court has used a linguistic analysis when deciding railroad title cases, and generally have been consistent in their holdings. In general, these decisions have held that when the deed was for “a right of way across,” the grantor only conveyed an easement, but if the grantor conveyed “land” or “a strip of land,” the grantor conveyed title in fee simple. If the railroad acquired its title to the strip of land by eminent domain under power of the Oklahoma Constitution, then the railroad acquired only an easement across the surface of the land.
If the railroad acquired its title to the strip of land by eminent domain proceedings under the laws of the Oklahoma territory, the acquisition of title to the land could be either an easement or fee simple interest, depending upon the language used by the court presiding over the condemnation proceedings.
To conclude, when analyzing title that contains railroad conveyances or easements, be especially diligent in your review of such to determine whether minerals were conveyed. Although such conveyances may be extremely old and appear to be surface easements, the language of the grant may actually convey minerals. When in doubt in a determination of mineral ownership under a railroad in Oklahoma, an experienced title attorney can assist both the landman and the mineral owner alike. If there are any other topics/issues you would like to discuss with the energy community, or myself, please mention your ideas and thoughts in the comment section.
Jordan D. Volino is an attorney at Hampton and Milligan practicing in Oklahoma City, Oklahoma, who specializes in mineral title examination, oil and gas law, property law, as well as federal and Indian title and leasing. Jordan is a member of the Oklahoma Bar Association and the Oklahoma City Association of Professional Landmen. Jordan also is a published scholar, national champion in energy negotiations, and frequently lectures over Oklahoma oil and gas matters.
Adjunct Professor J. David Hampton joined the College of Law faculty in 2008 and the Price College of Business faculty in 2015. Professor Hampton teaches Mineral Title Examination and Real Property Law. After graduating from the University of Oklahoma College of Law in 1980, he founded Hampton and Milligan, a 30-year-old Oklahoma City law firm specializing in oil and gas law title examination, oil and gas litigation, environmental law, and real estate title examination. Currently, Professor Hampton is a lecturer for the American Association of Professional Landmen, as well as the Oklahoma City Association of Professional Landmen.
CLICK HERE TO SUBSCRIBE TO OUR WEEKLY OIL AND GAS INDUSTRY NEWSLETTER DELIVERED DIRECTLY TO YOUR INBOX FROM OKLAHOMAMINERALS.COM