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Enervest Operating, LLC v. Sebastian Mining, LLC

United States Court of Appeals for the Eighth Circuit
676 F.3d 1144 (2012)


The owner (grantor) of some lands conveyed the surface and coal rights in the lands to Sebastian Mining, LLC (Sebastian) (defendant). The deed reserved for the grantor oil, gas, and other minerals, including “any substance which is embraced within the meaning of the word ‘mineral.’” Anadarko Petroleum Corporation and others (gas owners) acquired via two deeds the oil, gas, and all other mineral rights, except for coal, in the lands. The first deed, which was executed prior to the Sebastian deed, conveyed “all of the oil, gas and other minerals,” but reserved coal for the grantor. The second deed, which was executed after the Sebastian deed, conveyed an interest “in the oil, gas and other minerals, [except] coal.” EnerVest Operating, LLC (EnerVest) (plaintiff) entered several oil and gas leases with Sebastian and the gas owners. EnerVest brought suit for interpleader seeking a ruling as to who was entitled to receive royalties from production of coal bed methane gas (CBM) in the properties. CBM was a type of natural gas that formed in coal beds. The trial court found that the gas owners were entitled to the CBM royalties.

Rule of Law


Holding and Reasoning (Gruender, J.)

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