An Overview of the Wyoming Split Estate Act
Wyoming
staking, surveys, measurements, and general evaluation of proposed routes and sites for access and facility location. Prior to initial entry upon the land for non-surface disturbing activities, the operator must provide at least five days prior notice to the surface owner. See WY Stat § 30-5-402(b).
In Wyoming, when surface real property and the corresponding oil and gas interests under that surface are owned or possessed by different parties, the Wyoming Split Estate Act (the Act) – codified in Wyoming Statutes (WY Stat) §§ 30-5-401 et seq. – governs the interactions between the parties. The Act codifies the accommodation doctrine, which recognizes the need for each party to reasonably accommodate the use of the land by the other party. In a split estate situation, the Wyoming Supreme Court has noted that the surface estate and the mineral estate are “mutually dominant and mutually servient.” The Act was enacted in 2005 and is specific to oil and gas operations, as Wyoming has different split estate statutes related to hard rock mining. The Act places a reasonableness standard on the surface estate and oil and gas estate parties. Specifically, the Act expressly provides any “oil and gas operator” (operator) with a right to “enter the land for all purposes reasonable and necessary to conduct oil and gas operations to remove the oil or gas underlying the surface of that land.” WY Stat § 30-5-402(a). However, the operator must first comply with the provisions of the Act and “reasonably accommodate existing surface uses.” Id . A surface owner may waive in writing any rights afforded to it under the Act. The Act differentiates between an operator’s “non-surface disturbing activities” and “oil and gas operations” (the latter of which, by definition, disturbs the surface).
Oil and Gas Operations
The Act defines “oil and gas operations” as “the surface disturbing activities associated with drilling, producing and transporting oil and gas, including the full range of development activity from exploration through production and reclamation of the disturbed surface.” WY Stat § 30-5-401(a)(iv). An operator must take several required steps under the Act before entering the surface land to conduct oil and gas operations.
Requirements Prior to Entry
Before entering the land for oil and gas operations, the operator must provide the required notice (discussed in more detail below), attempt good faith negotiations, and either: (i) secure the written consent or waiver of the surface owner for entry onto the land for oil and gas operations; (ii) obtain an executed surface use agreement providing for compensation to the surface owner for damages to the land and improvements as provided in the Act; (iii) secure a waiver from the surface owner as permitted by the Act; or (iv) in lieu of complying with clause (i) or (ii), execute a sufficient surety bond or other guaranty to the Wyoming Oil and Gas Conservation Commission (the Commission) for the use and benefit of the surface owner to secure payment of damages. See WY Stat § 30-5-402(c).
Non-surface Disturbing Activities
An operator has the right to enter upon the surface land for non-surface disturbing activities that are reasonable and necessary to determine the feasibility and location of oil and gas operations. Non-surface disturbing activities include inspections,
Notice Prior to Entry
Before entering upon the land for oil or gas operations, the operator must give all affected surface owners a written notice of its proposed oil
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N at i onal A ssociation of D i v i s i on O rder A nalys t s
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