Minneapolis Gas Company v. Dahle

171 N.W.2d 813, 285 Minn. 166, 34 Oil & Gas Rep. 217, 1969 Minn. LEXIS 958
CourtSupreme Court of Minnesota
DecidedNovember 7, 1969
Docket41916
StatusPublished
Cited by1 cases

This text of 171 N.W.2d 813 (Minneapolis Gas Company v. Dahle) is published on Counsel Stack Legal Research, covering Supreme Court of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Minneapolis Gas Company v. Dahle, 171 N.W.2d 813, 285 Minn. 166, 34 Oil & Gas Rep. 217, 1969 Minn. LEXIS 958 (Mich. 1969).

Opinion

*167 Otis, Justice.

The petitioner, Minneapolis Gas Company, has condemned an easement for a storage reservoir of natural gas underlying 8,400 acres of farmland in Waseca, Le Sueur, and Rice Counties. Three of the affected property owners, Sydney M. Dahle, Otto Jellum, and Selma Jellum, have been granted leave under Rule 105, Rules of Civil Appellate Procedure, to appeal from the order of the trial court granting the petition for an easement and appointing commissioners to assess damages.

The issue in this court has been narrowed to the question of whether Minn. St. 222.36 and 300.04 1 authorize the gas company to condemn an easement only, or whether there is such a substantial risk of danger from escaping gas that the statute must be construed to require the public service corporation to condemn the entire fee.

Minn. St. 84.57 to 84.621, as amended by L. 1969, cc. 723 and 724, prescribe the procedure for securing from the commissioner of conservation a permit for underground storage of natural gas. Section 84.60 provides in part as follows:

“No order granting a permit for the proposed storage shall be issued unless it shall contain and be based on the following findings:
“(1) The proposed storage will be confined to geological stratum or strata lying more than 500 feet below the surface of the soil;
*168 “(2) The proposed storage will not substantially impair or pollute any water resources;
“(3) That the public convenience and necessity of a substantial portion of the gas consuming public in the state will be served by such undertaking * *

Pursuant to statute, Minneapolis Gas Company was granted a hearing in September 1967 and in June 1968 on its petition to secure a permit for gas storage, notice of which was given to all affected property owners. The commissioner’s findings may be summarized as follows:

In December 1966, the gas company served 243,560 customers of whom 219,674 used natural gas for heating purposes. Gas is purchased from Northern Natural Gas Company primarily for residential space heating, little or none of which is required during the summer. The purpose of a storage facility would be to permit the purchase of gas during the summer for use in the winter when the demand is high, thereby effecting a saving which would be passed on to consumers. The commissioner found: “The public convenience and necessity of a substantial portion of the gas-consuming public in the state will be served by the proposed project.” The company’s proposal was to store gas underground by injecting gas under pressure and displacing water in the Mount Simon sandstone underlying 8,400 acres in Waseca, Le Sueur, and Rice Counties. The commissioner enumerated three requisites for such a purpose: 2

(a) The storage area must be a geologic trap capable of confining the lateral movement of gas to an area within the reservoir.

(b) The storage reservoir must consist of a layer of sandstone or other porous water-bearing rock of sufficient thickness and porosity, and permeable enough, to permit gas to be injected and withdrawn. “The storage reservoir, must also be far enough *169 below the land surface to make safe the storage of gas at the pressures required.”

(c) There must be an impermeable cap rock above the storage reservoir to prevent the leakage of gas to the surface.

The commissioner went on to find that there was a geologic structure in the form of an asymmetric anticline 5 miles long and 2 miles wide, located 750 feet below the land surface and consisting primarily of sandstone. The proposed storage area was capable of containing 34 billion cubic feet of gas.

Appellants cite the following finding in support of their claim that the proposal involves a substantial risk of danger:

“If there is substantial migration of gas from the Mount Simon ‘A’ zone into the Mount Simon ‘transition’ zone, it is possible that the full 406 pounds per square inch gauge pressure could accumulate at the top of the ‘transition zone’ which would amount to 0.50 pounds per square inch per foot of depth at the top of the Mount Simon. A gradient of 0.50 pounds per square inch per foot is normally not used in aquifer storage projects.”

The commissioner found that above the Mount Simon storage area the Eau Claire strata serve as a cap rock to prevent the leakage of gas to the surface. The Eau Claire strata are about 100 feet above Mount Simon and have a thickness of 25 to 30 feet, the bottom 5 to 10 feet of which is shale, with low enough permeability to prevent gas migration from the storage reservoir. Two separate tests were made in 1967 and 1968 to determine permeability. Water was pumped from below the Eau Claire strata to determine whether the water level above that area would thereby be affected. Some variation in the 1967 level was noticed but none in the 1968 test, as a result of which the commissioner was of the opinion that there was no communication of water across the Eau Claire cap rock. The commissioner noted that the presence of gas could probably be detected by monitoring observation wells. However, if injected gas did appear in water wells, it was possible that explosive mixtures could result. *170 Any gas which reached the land surface might have an objectionable odor because of impurities picked up by the gas.

Finally, the commissioner was satisfied that storage would be confined to strata 500 feet or more below the surface and “there is no indication that there will be any impairment or pollution of water resources.” In his order, the commissioner imposed a requirement that wells be completed in a way which would minimize the possibility of mechanical leakage and directed that existing wells be tested at frequent intervals to determine whether any gas was present. Other specific measures were required to determine routinely any gas leakage and to minimize the possibility of objectionable odor.

No appeal has been taken from the order of the commissioner of conservation granting the permit sought by Minneapolis Gas Company. Appellants concede that the matters determined in that proceeding cannot be collaterally attacked but argue that the issue of whether the company is obliged to condemn the fee is not a matter over which the commissioner had jurisdiction.

The trial court granted the gas company’s petition for condemnation of the following estate:

“The exclusive right, privilege and easement in perpetuity to establish, operate and maintain, a gas storage reservoir by the introduction of natural gas or other gases or vapors (all herein referred to as gas) into the geological formations underlying the lands hereinafter described at a depth of five hundred (500) feet or more; to store gas in said reservoir; to retain the possession of gas so stored and the right to withdraw said gas with any water vapor absorbed.

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Related

M.T. Properties, Inc. v. Alexander
433 N.W.2d 886 (Court of Appeals of Minnesota, 1988)

Cite This Page — Counsel Stack

Bluebook (online)
171 N.W.2d 813, 285 Minn. 166, 34 Oil & Gas Rep. 217, 1969 Minn. LEXIS 958, Counsel Stack Legal Research, https://law.counselstack.com/opinion/minneapolis-gas-company-v-dahle-minn-1969.