Landowners, Oil, Gas & Royalty Owners Ex Rel. Romang v. Corporation Commission

1966 OK 111, 415 P.2d 942
CourtSupreme Court of Oklahoma
DecidedJune 7, 1966
Docket41362
StatusPublished
Cited by7 cases

This text of 1966 OK 111 (Landowners, Oil, Gas & Royalty Owners Ex Rel. Romang v. Corporation Commission) is published on Counsel Stack Legal Research, covering Supreme Court of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Landowners, Oil, Gas & Royalty Owners Ex Rel. Romang v. Corporation Commission, 1966 OK 111, 415 P.2d 942 (Okla. 1966).

Opinion

BLACKBIRD, Justice.

The order herein appealed from was a part of a “Report * * *” entered by this State’s Corporation Commission (hereinafter referred to simply as the “Commission”) on November 24, 1964, as its No. 56884 in its Cause CD No. 20343. The principal feature of the Order, in so far as concerns this appeal, is that it established 640-acre drilling and spacing units for the production of natural gas, and gas condensate, from the Mississippi Lime formation under an area covering 35 sections of land south of the town of Goltry, and on all sides of the point approximately 12 miles west of Enid, Oklahoma, where the western boundary of Garfield County meets the common boundary of Alfalfa and *944 Major Counties. The area thus spaced is depicted on the part of the plat incorporated herein, designated by the letter “C”. By previous order of the Commission such units had already been established for such production from the same common source of supply in the area designated “A” on said plat. The first one of these orders, referred to in the present proceedings as the “basic order”, was numbered 55060 and entered in May, 1964.

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In less than 4 months after the Commission had entered this first 640-acre spacing order No. 55060, supra, it entered, in another well spacing proceeding, its Order No. 54686, establishing 80-acre drilling and spacing units for the production of oil and gas from the Mississippi Lime in the area marked by the letter “B” on this same plat, or map. There are 40 to 50 wells, *945 of which Shell Oil Company has IS, producing oil and other liquid hydro-carbons from the Mississippi Lime in area B.

The proceedings, in which the subject order No. 56884, supra, was entered, were commenced on the Application of Shell Oil Company (hereinafter referred to merely as “Shell” or “Applicant”) which, together with Champlin Oil Company, owns oil and gas leases on between SO and 60 percent of the land in area C. The Application specifically referred to Shell’s encountering the Mississippi Lime at an approximate depth of 6330 feet below the surface, in its Shell-Davis well, and characterized this as the discovery of “a common source of supply of gas and gas condensate.” Besides Champlin Oil Company which drilled and operates the Champlin-Davis, Champ-lin-Butler, Champlin-Koshn, and Champ-lin-Johnson wells (all of whose locations are shown by spots on the within map), Shell’s application was supported by Humble Oil Company, another major lessee and operator in the area, and by Harper Oil Company.

An “Answer” opposing the Application was filed with the Commission on behalf of “* * * a majority of the landowners, oil, gas and royalty owners in and to the land described in the caption of this cause, * * * ”. This pleading contained allegations, among others, to the effect that the Shell-Davis well was an oil, rather than a gas, well, that the proposed spacing would permit one well, whether oil or gas, to hold leases on an entire section of land as to all oil and/or gas formations underlying it, and would compel a division of the royalty from every stick zvell among all of the owners of minerals in each such section, in violation of Tit. 52 O.S.1961, sec. 87.1 (c)’s prohibition against spacing units larger than 80 acres, in common sources of oil supply, lying less than 9,990 feet, and more than 5,000 feet, below the surface, and would constitute the taking of private property without due process and just compensation, in violation of both the State and Federal Constitutions.

At the Commission’s hearing, which commenced in July and concluded in October, 1964, both those in favor of the application (referred to collectively herein as “applicants”) and those opposing it (referred to collectively as “protestants”) introduced oral testimony and documentary evidence. The principal question sought to be resolved thereby appears to have been whether this area C, proposed for 640-acre spacing, was underlain by a common source of supply, or reservoir, and, if so, was it a gas reservoir (like area A) or an oil, or. oil and gas reservoir (like area B) ? In written findings preceding the order in its report, the Commission found that the Shell-Davis, Shell-Burdick, Aladdin-Pecha, and Champlin-Davis wells were gas, and gas condensate, wells, which penetrated a new and separate common source of supply.

In their present appeal from said order,, protestants’ arguments for reversal are advanced under five propositions, but the efficacy of all of them depends primarily on the merits of their first “Proposition”, which is:

“The Order is not sustained by substantial evidence.” Under this proposition, protestants. direct our attention to-certain portions of the testimony of the-two expert witnesses, Mr. Tinker and Mr. Bartgis, who testified for the applicants,, and of the expert, Mr. Murta, and one landowner, Mr. Tyner, who testified for the protestants; and they conclude with an announcement of their failure to find' any substantial evidence to show that the-subject 35 sections of land, is a “predominantly gas area.” They attempt to support their said “finding”, as follows: (1) They assert that the producing wells outside this area C are all oil wells, which they say is a “good indication” that any future wells drilled within said area will also be oil wells; and (2) They assert there are no production records on a single-well in said area, and call attention to the-fact that no wells of any kind have been: drilled in said area’s eastern half. We- *946 have thoroughly examined the record in this case, and have found therefrom, that the statements referred to are either incorrect, or are otherwise inadequate to constitute ground for reversing the order appealed from.

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1966 OK 111, 415 P.2d 942, Counsel Stack Legal Research, https://law.counselstack.com/opinion/landowners-oil-gas-royalty-owners-ex-rel-romang-v-corporation-okla-1966.