mineral code notes

mineral code notes - Mineral Code for the State of...

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Mineral Code for the State of Louisiana Selected excerpts are given below: Art. 4. The provisions of this code are applicable to all forms of minerals, including oil and gas. They are also applicable to rights to explore for or mine or remove from land the soil itself, gravel, shells, subterranean water, or other substances occurring naturally in or as a part of the soil or geological formations on or underlying the land. Anything of value on or under the land is a mineral, including oil and gas. Art. 5. Ownership of land includes all minerals occurring naturally in a solid state. Solid minerals are insusceptible of ownership apart from the land until reduced to possession. Solid minerals (gravel, coal, etc) are part of the land itself and are owned by the landowner. Art. 6. Ownership of land does not include ownership of oil, gas, and other minerals occurring naturally in liquid or gaseous form, or of any elements or compounds in solution, emulsion, or association with such minerals. The landowner has the exclusive right to explore and develop his property for the production of such minerals and to reduce them to possession and ownership. Oil, gas, etc, that occur in liquid or gaseous state is not owned by the landowner. A neighbor who has a well and is producing oil and/or gas from both his and his neighbor’s land is doing so legally. The landowner has the right to explore and develop his property to produce this same oil and/or gas in competition with his neighbor. The Office of Conservation was created to prevent the drilling of unnecessary wells by power of unitization, etc, which will be discussed later. Art. 8. A landowner may use and enjoy his property in the most unlimited manner for the purpose of discovering and producing minerals, provided it is not prohibited by law. He may reduce to possession and ownership all of the minerals occurring naturally in a liquid or gaseous state that can be obtained by operations on or beneath his land even though his operations may cause their migration from beneath the land of another. This is the “Rule of Capture”, that is, whoever captures the oil and/or gas owns it. This rule is analogous to the wild duck. No one owns the duck until it is reduced to possession. Art. 14. A landowner has no right against another who causes drainage of liquid or gaseous minerals from beneath his property if the drainage results from drilling or mining operations on other lands. This does not affect his right to relief for negligent or intentional waste under Articles 9 and 10, or against another who may be contractually obligated to protect his property from drainage. The “Rule of Capture” prevails. However, it also protects the landowner from negligent or intentional waste, such as a blowout where oil and/or gas are lost, etc. He can expect an entity that holds a lease on his property (an oil company) to protect his interests, such as drilling a well on his property to prevent the neighbor from producing all of the oil and/or gas. The lease
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This note was uploaded on 04/07/2008 for the course ACCT 1001 taught by Professor A during the Spring '08 term at LSU.

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mineral code notes - Mineral Code for the State of...

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