Entek GRB, LLC v. Stull Ranches, LLC

Stull Ranches, LLC (Stull) (defendant) operated a grouse-hunting business on a surface estate in Colorado. Stull’s predecessor-in-interest had obtained the land pursuant to a federal land grant under the Stock-Raising Homestead Act of 1916. That statute reserved for the government all mineral rights in the land-grant lands, including (1) the right to enter and use the surface in ways reasonably incident to mineral exploration and removal and (2) the right to enact future laws and regulations concerning the disposal of the minerals. One law enacted by the government with respect to mineral disposal was the Mineral Leasing Act, which allowed the government’s mineral interests to be leased to private mining operations. A subsequent amendment to the Mineral Leasing Act, codified at 30 U.S.C. § 226(m), allowed the lessees in a single oil-and-gas field to develop a cooperative unitization agreement for developing and operating the field. Entek GRB, LLC (Entek) (plaintiff) had a mineral lease from the federal government for the mineral estate underneath Stull’s surface estate and other adjoining surface estates owned by the federal Bureau of Land Management (BLM). Stull’s surface estate and the BLM land were subject to the Focus Ranch Unit Agreement (the agreement), a unitization agreement providing that drilling and production operations on any tract of land in the unit were deemed to be performed on and for the benefit of every tract of land in the unit. Entek was the designated operator of the Focus Ranch Unit. Entek sought to enter Stull’s surface estate so that Stull could (1) develop new oil-well sites on Stull’s land and (2) use the only available road to access one of Entek’s wells on the BLM’s adjacent surface estate. Stull refused because Stull did not want Entek to disturb the grouse. Entek sued Stull in federal district court, seeking access to Stull’s surface estate. The district court held that Entek could access Stull’s surface to conduct mining operations related to the minerals below Stull’s surface but could not use Stull’s surface to access the well on the adjacent BLM land. Entek appealed.