What is Pore Space?
Pore Space refers to the spaces between rocks that were occupied by a solid material. Over the past few years, interest in carbon capture and sequestation or carbon carbon capture and storage (CCS) has reemereged as a result of significat increases in tax incentives for carbon capture. As a result, many oil and gas producers are now interested in using pore space for CCS. Thus this an opportunity for landowners to lease the pore space to oil & gas producers.
Is Pore Space the next frotier for Oil & Gas production?
Pore Space is an opportunity for landowners to store natural gas such as carbon, but the big question is whether the surface owner or the mineral owner owns the pore space. The Majority rule is that the surface owner owns the pore space but Ohio courts have not spoke directly as to who owns the pore space. So, while the idea of renting the pore space is an interesting one there is little guidanace as to who actually has the right to lease the pore space in Ohio.
Here's what we know from early twentith century cases in Ohio.
In 1911, the court in Chartiers Oil vs. Curtiss, 1911 Ohio Misc. LEXIS 241, at 9-10, 14, seems to indicate that storage rights are not incidental to a grant of the right to explore for and extract minerals. The Court explained that although the plaintiff had acquired the “right to drill for oil and gas,” it did not acquire the “right of storage.” However, when it comes to early Ohio decisions involving coal rights, the law seems to be clear that the mine owner has the right to use as he may choose, but without injury to the owner of the soil, the space left by excavation of the mineral. The logic behind this is that the empty space remaining after coal extraction is useful to the coal operator in the extraction of the remaining coal. See, Moore vs. Indian Camp Coal Co., 80 N.E. 6, 8 (OHio 1907).
Our neighbor the State of West Virginia has the leading case on the issue Tate vs. United Fuel Gas Co., 71 S.E. 2d 65 (W.Va. 1952)
In the leading case Tate vs. United Fuel Gas Co., 71 S.E.2d 65 (W.Va. 1952) from 1952, the Supreme Court of Appeals held that so long as no recoverable minerals existed in the subsurface stratum, the surface owner possessed the right to grant storage rights. And the Tate case has been recognized by leading oil and gas treaties for the principle that the surface owner rather than the mineral owner is entitled to gas storage rental when the minerals originally in place in the stratum in question had been depleted.
If you're thinking about leasing the pore space give us a call so that we can make sure that you get the most value for your land. Call us at 740-346-2899.
