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Kartch v. EOG Order

Kartch v. EOG Order

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Published by: northdecoder on Mar 01, 2012
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07/10/2013

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Case4:10-cv-00014-DLH-CSMDocument89Filed
02/29/12
Page1of33
INTHEUNITEDSTATESDISTRICTCOURTFORTHEDISTRICTOFNORTHDAKOTANORTHWESTERNDIVISIONFrankieKartchandKristinKartch,Plaintiffs,
))))))))))
ORDERGRANTING,INPART,DEFENDANTS'MOTIONFORSUMMARYJUDGMENTvs.CaseNo.4:l0-cv-014EOGResources,Inc.,aforeignbusinesscorporation,Defendant.BeforetheCourtistheDefendant'smotionforsummaryjudgmentfiledonAugust25,2011.SeeDocketNo.46.ThePlaintiffsfiledabriefinoppositiontothemotiononNovember28,2011.SeeDocketNo.74.TheDefendantfiledareplybriefonDecember21,2011,andanamendedreplybriefonDecember28,2011.SeeDocketNos.80and83.OralargumentswerepresentedbythepartiesonFebruary24,2012.Forthereasonsexplainedbelow,theDefendant'smotionisgrantedinpartanddeniedinpart.I.BACKGROUNDTheplaintiffs,FrankieKartchandKristinKartch,ownthesurfacerightstolandlocatedinMountrailCounty,NorthDakota.OnMarch29,2004,FrankieKartchpurchasedallofSection17,Township158,Range89WestinMountrailCounty,NorthDakota,fromRodneyIversonandLindaIverson.SeeDocketNo.13-1,pp.37-39.TheIversonsretainedthemineralrights.TheKartchescurrentlyrentoutthelandforfarming.FrankieKartchhasalsohuntedandcampedontheland.
 
Case4:10-cv-00014-DLH-CSMDocument89Filed
02/29/12
Page2of33
OnNovember30,2006,theIversonsleasedtheirmineralinterestinSection17toRitter,Laber
&
Associates,Inc.SeeDocketNo.13-2.OnNovember26,2007,Ritter,Laber
&
Associates,Inc.assignedtheleasetodefendantEOGResources,Inc.("EOG").SeeDocketNo.13-3.OnAugust25,2008,ContexEnergyCompany("Contex")sentanoticetotheKartchesstating:PursuanttoChapter38-11.1oftheNorthDakotaCenturyCode,youareherebynotifiedthatEOGResources,Inc.("EOGR")ofP.O.Box4362,Houston,Texas77210-4326,intendstocommenceorcausetobecommencedthedrillingofitsCrowfoot#1-17HWellatthefollowinglocation:Township158North,Range89West.5
th
P.M.Section17:
NW1I4NW1/4
TheenclosedAccessandDamageSettlementAgreementdescribestheamountoflandtobeusedfortheCrowfoot#1-17Hwellandappurtenantfacilitiesaswellasthecompensationofferedforsuchuse.EOGRestimatesthatdrillingoperationswilltakefrom40to45days.Afterrigrelease,facilitieswillbeconstructedandthencompletionoperationsarecommenced.Theseactivitiestypicallytakeanadditional30daysdependingonweatherandequipmentandpersonnelavailability.EOGRrespectfullyrequestsyourwaiveroftherequiredtwenty(20)daynoticeofitsintenttodrillsothatithastheoptionofcommencingwellsiteconstructionbeforetheexpirationofsaidtwenty(20)daynoticeperiod.SeeDocketNo.7-3.EOGofferedtopaytheKartches$8,000:assurfacedamagestobuildtheAccessRoadandDrillsitelocation,todrillawell(s)forthepurposesofdevelopingthemineralsunderlyingsaidSection17,Township158North,Range89West,andintheeventthewell(s)iscompletedasproducer,toinstall,constructandmaintainontheDrillsiteequipmentandfacilitiesforproduction,storage,transportationand/ormarketingofproducedsubstances.SeeDocketNo.7-1.TheKartchesdidnotacceptEOG'soffer.2
 
Case4:10-cv-00014-DLH-CSMDocument89Filed
02/29/12
Page3of33
AftertheKartchesreceivedthenotificationfromContex,theirattorneysentlettersontheirbehalftoContexandEOGrequestingthatEOGuseaclosedloopsystem,ratherthanareservepit.
1
SeeDocketNo.76.TheKartchesdidnotreceivearesponsefromeitherContexorEOG.FrankieKartchstatedinanaffidavit,"Ialsohadaphonecallwith[Ty]Stillman[ofEOG]inthefallof2008whereIagainverballyrequestedaclosedloopsystemonourproperty.Hisresponse:'Iwouldhaveneededtoknowaboutthatsixmonthsago."SeeDocketNo.76.OnJanuary23,2009,theKartchespurchasedthesurfaceinterestinportionsofSections7and8,Township158,Range89WestinMountrailCounty,NorthDakota.SeeDocketNo.13-1,pp.41-47.TheKartchescurrentlyrentoutSections7and8forfarming.ThereisahouselocatedonSection8thattheKartchesalsorentout.InDecember2008,EOGdrilledawellonSection17.Inanaffidavit,JimSchaeferofEOGexplained:2.EOGenteredthesurfaceandbegandrillingtheCrowfoot1-17Hwell,locatedintheNW
1/4
ofSection17ofTownship158North,Range89Westofthe5thP.M.,MountrailCounty,NorthDakota,in2008.Itcompletedthewellin2009.ThewellproducesoilandEOGhasbeenmarketingtheoil.EOGisnowusinglesssurfaceareathanwhenitdrilledthewell.3.EOGreclaimedthereservepitatthewellsiteinOctober2009....7.EOGhasbeenflaringthegasproducedattheCrowfoot1-17Hwellsiteusingasingleflare....SeeDocketNo.49.
1
Areservepitis"anearthenpitusedforcollectingandstoringwater,drillingfluid,producedoil,drillingmud,andwellcuttingswhenawellisbeingdrilled."SeeDocketNo.49.Inaclosedloopsystem"[t]hedrillcuttingsgointoasteelcontainer...andarehauledawaytoawastedisposalsite,andalloftheliquidphase...stayswithintherigmudtanksandsteeltanksandisreused,recycledorhauledtoadisposalsite."SeeDocketNo.74-3,p.23.
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