Rule of Capture

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The Rule of Capture

 

         The rule of capture clearly applies in Alabama.  As stated in NCNB Texas National Bank, N.A. v. West, 631 So.2d 212, 224 (Ala. 1993):

Under the rule of capture, gas that migrates from one property to another is subject to recovery and possession by the holder of the gas estate on the property to which the gas migrates. The rule has been stated as follows: ‘The owner of a tract of land acquires title to the oil and gas which he produces from wells drilled thereon, though it may be proved that part of such oil and gas migrated from adjoining lands.’  Hardwicke, The Rule of Capture and Its Implications as Applied to Oil and Gas, 13 Tex.L.Rev. 391, 393 (1935). Strictly speaking, the rule of capture evolved to settle disputes between oil and gas owners on separate tracts of land with mutual access to the same pool or source of oil or gas. Under this rule, ‘absent negligence, waste, or fraud, the owners of oil and gas rights have no protection against drainage resulting from vertical drilling on adjacent tracts, but under the rule of ‘go and do likewise’ they are not liable if their activities drain oil or gas from adjacent tracts.’ Lewin et al., supra, at 619 n. 256. The rule, thus, applies to vertical drilling on different tracts of land within the same oil or gas field; it is not meant to allow “competition among holders of different mineral interests within a single tract.” Id. at 619. The rule settles disputes over title to migratory mineral resources such as gas and oil. This rule applies to coalbed methane gas, a migratory mineral resource. Thus, so long as the coalbed gas is bound within the coal seam in which it originated, the holder of the coal estate has the right to extract the gas and reduce it to possession. However, once the coalbed gas migrates out of the stratum in which it originated, the right to recover the gas belongs to the holder of the gas estate.

Copyright 2011 by Edward G, Hawkins. All rights reserved.