Negotiating Agreements with
Pipeline Companies
By Bryan May
T
Bryan May
involved, how much land will
be used, the planned above and
below ground facilities, and the
current and expected future use
of the land. Often overlooked,
but potentially as important as the
initial consideration, are the rights
retained by the landowner. While
the landowner may never be able
to build a structure or impound
water on an active pipeline, many
landowners want provisions in
their easement agreements that
permit future roads and utilities
to cross the pipeline, and allow
for parking lots or landscaping on
the easement. Other important
considerations include the loca-
tion of the proposed pipeline,
potential environmental and cata-
strophic damages, future replace-
ment or major repair of the pipe-
line, and termination of the ease-
ment. It is important to discuss
these provisions with an attorney
with experience negotiating ease-
ment agreements and handling
condemnation matters.
This article is for informational purposes
only and not for the purpose of providing
legal advice. You should contact an attor-
ney to obtain advice with respect to any
particular legal issue.
Bryan May is an oil and gas attorney
with Harris, Finley & Bogle, P.C., with a
unique industry expertise as a Certified
Professional Landman. Bryan’s practice
focuses on representing landowners and
oil and gas companies in various matters.
He can be reached at [email protected]
or at 817.870-8706.
of the property, (iv) and allow the
landowner certain time periods to
respond to each offer.
Once a party with eminent
domain power has complied with
its due process obligations, files
a condemnation lawsuit, and the
appropriate parties are served with
notice the judge presiding over
the case will appoint three special
commissioners. The special
commissioners are designated to
determine the value of the prop-
erty to be condemned. Each party
may provide the special commis-
sioners with evidence about the
value of the property, and the
effect of the condemnation on the
value of the remaining land. Once
the special commissioners deter-
mine the value of the property to
be condemned, called the ease-
ment property, the party seeking
condemnation may simply pay
this amount to the landowner and
the court will authorize construc-
tion of the pipeline. If either party
disputes the special commis-
sioners’ value determination, the
disputing party may seek a hear-
ing to present evidence to the
court regarding the value of the
easement property and the value
of the remaining land burdened
by the easement.
Avoiding eminent domain
proceedings is often in the
best interest of all involved. As
such, it is important to main-
tain contact with the pipeline
company and to work toward
agreeable terms when negotiat-
ing a potential agreement. For
some, the most meaningful term
is the initial consideration paid
for the easement. This amount
ranges substantially depend-
ing on the specifics of the land
he State of Texas is at the
forefront of unprecedented
growth. From highway work in
population centers to buildouts
in energy hubs and the pipelines
that connect the two, the entire
state is experiencing rapid expan-
sion, particularly in infrastructure.
As a state with historical regard
for private property as well as an
economy and cultural identity
tied to oil and gas, rapid growth
can be problematic.
Across Parker County, land-
owners and pipeline companies
are seeking relief under the
Fifth Amendment to the United
States Constitution. The Fifth
Amendment provides that “No
person shall be … deprived of
life, liberty, or property, without
due process of law; nor shall
private property be taken for
public use, without just compen-
sation.” Keep the following in
mind if you are contacted by a
company seeking to build a pipe-
line on your property.
Many pipeline companies are
considered by the government to
be common carriers. Common
carriers are given broad power to
use eminent domain to condemn
private property for public uses,
such as pipelines. Condemnation
power comes with strict due
process obligations. Before bring-
ing a condemnation lawsuit,
an entity holding the power
of eminent domain seeking to
construct a pipeline across private
property must (i) make at least
two good faith offers to acquire
the property from the landowner,
(ii) provide the landowner a copy
of the State of Texas Landowner’s
Bill of Rights, (iii) provide the
landowner at least one appraisal
11