It may come as a surprise that Ohio’s farmland is more valued for what it has underneath the land rather than what it grows or raises above the land. The content of what is underground, however, explains this phenomenon: oil and gas. Understandably, the answer to “who holds the mineral rights” can have a significant impact on the debate between surface owners and mineral-interest holders.
Just last week, on June 18, 2015, the Ohio Supreme Court issued a unanimous opinion in Dodd v. Croskey, Slip Opinion No. 2015-Ohio-2362, 2015 Ohio LEXIS 1542 (Ohio June 18, 2015), solving one piece of the puzzle in the oil and gas debate over the Dormant Mineral Act (DMA). The owners of the surface land, claimed that the holder of an interest in the minerals beneath the surface, abandoned their rights pursuant to the Dormant Mineral Act, and therefore, the ownership rights to the minerals had vested in them.
The Court affirmed the lower courts’ decision that the mineral rights stayed with the mineral-interest holders, and provided two ways a mineral-interest holder may counter a surface owner’s notice of claim for abandonment: (1) by filing a claim to preserve the mineral interest with the county recorder’s office, or (2) by filing an affidavit that identifies a “saving event” that occurred in the 20-year window preceding surface owner’s notice. See R.C. 5301.56(B)(3). Either document must be filed within 60 days of receiving notice. The General Assembly’s intent for the act’s 2006 amendments–to provide alternative ways a mineral-interest holder’s claim can preserve oil and gas rights–played a central role in the Court’s decision. See R.C. 5301.56(H). In this case, the mineral-interest holder’s affidavit did not identify a saving event, but it qualified as a claim to preserve the mineral interests from being deemed abandoned, and the document was filed within 60 days after the surface owner’s notice.
This decision, however, still leaves unanswered additional questions surrounding the oil and gas development. The next issues awaiting their answers involve potential conflicts between the 1989 and 2006 versions of the Dormant Mineral Act. In Patricia Shondrick-Nau v. Jon D. Walker Jr., the Court will address the following question, among others: “Did the 2006 version of the DMA clarify that the 1989 act never meant to be a ‘use it or lose it’ law, and required surface rights owners to serve notice to dormant mineral rights owners before attempting to acquire rights?” The Court is scheduled to hear oral arguments for Shondrick-Nau today, hoping to solve the next piece of the puzzle.