Sunray Oil Co. v. Cortez Oil Co.

1941 OK 77, 112 P.2d 792, 188 Okla. 690, 1941 Okla. LEXIS 116
CourtSupreme Court of Oklahoma
DecidedMarch 4, 1941
DocketNo. 29636.
StatusPublished
Cited by32 cases

This text of 1941 OK 77 (Sunray Oil Co. v. Cortez Oil Co.) 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
Sunray Oil Co. v. Cortez Oil Co., 1941 OK 77, 112 P.2d 792, 188 Okla. 690, 1941 Okla. LEXIS 116 (Okla. 1941).

Opinions

RILEY, J.

This is an appeal from a judgment and decree of the district court of Seminole county, enjoining Sunray Oil Company from using a well for disposal of salt water drilled for oil and gas on a tract of land in which Cortez Oil Company owned an undivided one-fourth mineral interest.

Prior to April, 1939, Burke-Greis Oil Company, and Rogers and Rogers, who held an oil and gas lease on the 80 acres, SE/4 of the NW14 and the SW14 of the NEi/4 of section 12, township 6 north, range 5 east, in Seminole county, had drilled on the leased area a test well for oil and gas. (Southwest ten acres of the SW% of the NE% of said section.) The well was drilled through the formation known as the Cromwell sand, encountered at a depth of about 3,045 feet, and through the Wilcox sand, found at about 4,000 feet. No oil or gas was found, and the well was abandoned and was about to be *691 plugged. The Cromwell sand there was 105 feet thick and saturated with salt water. Sunray Oil Company obtained an assignment of the oil and gas lease covering the ten-acre tract upon which the well was located, also it obtained from Genevieve Greer, owner of the surface rights and 53/80 of the mineral interest, a license to use the well for the disposal of salt water produced from other wells in the vicinity.

Sunray Oil Company “plugged” the well back to the bottom of the Cromwell sand, cemented casing from the surface to about the top of the Cromwell sand, cleaned the well out and tested it for oil and gas, and found none. The well was “swabbed” out and salt water rose in it 1,800 feet.

Sunray Oil Company owned and was operating oil and gas wells some distance from this well which were producing salt water in considerable quantities and was disposing thereof by piping it into the well here involved, when Cortez Oil Company commenced this action to enjoin the Sunray Oil Company from so using said well.

Permanent injunction was granted, and Sunray Oil Company appeals.

On appeal Sunray Oil Company contends error in overruling its demurrer to the evidence and in overruling defendant’s motion for judgment in its favor at the close of all the evidence, and error in granting the injunction, for the reason that the evidence does not show that the acts enjoined were in violation of plaintiff’s legal rights.

Right of Cortez Oil Company herein is derived solely from its mineral grant.

A grantee in a mineral grant of the nature here involved does not acquire ownership of oil and gas in place. Oil and gas, unlike ore and coal, are fuga-cious and are not susceptible of ownership distinct from the soil. A grant of the nature of that of Cortez Oil Company is not a grant of the oil and gas in the land, but of such part thereof only as the grantee may find and reduce to possession. It vests no title to any oil or gas which he does not extract and reduce to possession, and hence no title to any corporeal right or interest. Priddy v. Thompson, 204 Fed. 955.

It is now generally held that oil and gas are not capable of distinct ownership in place. Rich v. Doneghey et al., 71 Okla. 204, 177 P. 86; Cuff v. Koslosky, 165 Okla. 135, 25 P. 2d 290.

The right granted is that of ingress and egress, together with the right to use so much of the surface as may be necessary to explore for oil and gas, and if either be discovered, to reduce same to possession, whereupon such part of the oil as the grant may provide becomes the personal property of the grantee. This right, however, is subject to legislative control against waste. Rich v. Doneghey, supra. This right of the Cortez Oil Company was not exclusive. The same right is shared by the owner of the land. All other rights to the land and the use thereof remain in the owner. The rights acquired by Cortez Oil Company were not terminated. Sunray Oil Company expressly agrees that Cortez has the same right to use the land for the same purpose as it, and even the same well, subject to payment of reasonable share of expense.

But Cortez Oil Company asserts that there is a possibility that oil or gas may be found in some other sand under said 80-acre tract, and possibly in the same sand at locations other than the one in the particular ten acres where the well in question is located, that the act of Sunray Oil Company in placing salt water in the well might possibly result in the salt water escaping into other formations containing oil or gas and might force such oil or gas from said laiid, and might likewise force such oil or gas as might exist in the same sand at some other location from said land, and thus prevent Cortez Oil Company from ever *692 finding or producing oil or gas under its mineral grant.

The question is whether the judgment .or decree granting the permanent injunction is clearly against the weight of the evidence.

There is no substantial conflict in the evidence as to what has been done in an effort to produce oil from the land in question and from land in the vicinity.

The oil field known as the North Grayson field, so far as oil or gas has been produced, lies south and east, principally south of the 80 acres in which plaintiff has its interest. Numerous expert witnesses, geologists, petroleum engineers, and experienced producers of oil and gas, testified in the case. The expert witnesses all agree a “fault” extends along the northwest line of the producing area, running in a southwest to northeast direction from near the center of section 14, slightly over '-a mile southwest from the well in question, northeast and crossing near the southeast corner of the 80-acre tract involved, and thence northeast for some distance. (A “fault” is defined by some of the witnesses as a break in the formation where one part of the strata has moved without respect to the other part of the formation.) In other words, a formation of a given kind is found at one depth on one side of the “fault line,” and at another depth on the other side. A number of wells had been drilled north and west of the so-called fault line. In some wells the Cromwell sand was encountered at various depths ranging around ’3,100 feet. In those to the south and west it was found at a slightly higher level, and in those drilled to the northeast on the northwest side of the fault line it was found at a slightly lower level. In other wells further northwest the Cromwell sand was not found.

The well involved herein was drilled a short distance north and west of the fault line. No oil or gas was found in any of the wells drilled north and west of the “fault line.”

South and east of the fault line numerous wells have been drilled to what is known as the “Simpson Dolomite” formation, encountered there at about 3,800 feet. No Cromwell sand was found in any of the wells drilled south and east of the fault line.

It appears clearly, and all the expert witnesses agree, that there is no possibility of finding oil or gas in the Cromwell sand or any formation connected therewith on the 80-acre tract, unless it be found in what is known as a “trap.” That is a place where the sand has formed in a dome, higher than the common level, sealed above by an impervious formation and below by the salt water. Whether such a formation exists within the 80-acre area is a matter of speculation.

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Bluebook (online)
1941 OK 77, 112 P.2d 792, 188 Okla. 690, 1941 Okla. LEXIS 116, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sunray-oil-co-v-cortez-oil-co-okla-1941.