Replies to This Discussion

Permalink Reply by B on April 16, 2013 at 15:26

'Just wondering if anyone has had any success in getting a pipeline company to agree to this?

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Permalink Reply by Henry on April 18, 2013 at 0:03

Bill,

My guess is that no company will agree to this.  Think of the cost of removing the pipeline.  Huge.  I granted a ROW to a pipeline company, and my agreement required removal of all above-ground stuff once the pipeline is abandoned.  The pipeline was 42" deep, and it can stay there forever as far as I'm concerned.  If someone ever wants to develop the land, they can remove the pipeline as part of the development.  JMHO.

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Permalink Reply by B on April 18, 2013 at 10:20

That's exactly the point I'm making, that the cost is huge, so why should it be I, the property owner, who is stuck with that burden when it was the pipeline company that placed it in the ground in the first place for its, not my, use?  My heirs will receive less upon the sale of the property with the abandoned pipeline in the ground than they would if it weren't there.  A higher development cost with the pipelines in the ground means less money for my heirs in return. 

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Permalink Reply by Henry on April 18, 2013 at 12:12

That's why they pay you big money to put the pipeline in.  In my case, they ran the pipeline right along the property line of my 40 acres.  And for that right, they paid me over half of what the entire 40 acres was worth.  So does it diminish the value of my 40 acres?  Probably.  But certainly not by 50%.  And, I still get full use of my 40 acres.  I can grow timber, rent it out to hunters, and do whatever I want on everything except that tiny ROW along the edge.  

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Permalink Reply by Harold5011 on April 16, 2013 at 15:35

What you really want to put in your pipeline contract is a provision that states that within 15 calendar days of abandonment of the pipeline, the pipeline and all related facilities must be removed from the property, the property must then be remediated, and then the property must be placed back to its original (pre-pipeline) elevations and contours and topped with 12 inches of topsoil and if the Grantee fails to remove the pipeline after 30 days written notice, then you can remove the pipeline and perform the remediation and the Grantee must reimburse you, your transferees, heirs, successors or assigns, for twice the costs you incurred in removal & remediation, restitution of the elevations, as well as for all legal and expert fees you incur during the process. Something like that, except get a O&G lawyer to write it - but even then read it yourself and make certain he gets it right where there can be no confusion.  If you don't understand the clause, a judge probably will not understand it either.  If the company at the tail-gate of the experience is then anything but bankrupt, it might get their attention.

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Permalink Reply by Andrew on April 18, 2013 at 12:48

I don't have much personal experience with pipelines, but I know I personally would not want any piece of oilfield equipment buried under my property for no good reason - I'd be too concerned about the potential environmental liability involved, even if it was remote.

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Permalink Reply by Two Dogs, Pirate on April 18, 2013 at 12:51

Good luck on that clause.

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Permalink Reply by dbob on April 18, 2013 at 14:32

Removal may be a challenge, but I have seen some leases with clauses related to ensuring the pipeline was flushed/cleaned out prior to abandonment, with soil testing to demonstrate no environmental issues remain.

Also had a friend where the company abandoned the line, but then sold salvage rights to it to someone else, who came in and took out most of the line, and damaged a lot of the surface in the process...

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Permalink Reply by Two Dogs, Pirate on April 18, 2013 at 14:58

Yea but 15 days?

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Permalink Reply by B on April 18, 2013 at 15:22

He  probably means to say that the removal of the pipeline will commence within 15 days of abandonment.

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Permalink Reply by dbob on April 18, 2013 at 16:43

90 to 180 days is much more rationale.

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Permalink Reply by B on April 18, 2013 at 15:29

Harold5011, that's a great provision.  It seems to address everything necessary.  Thank you.

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