Sunday, October 12, 2014

Mineral Rights & 'Split Estates': A Lien On Private Property

By Ilana Mercer

 Lite libertarians—who always put "progress" above private property—just love fracking, the colloquial for "hydraulic fracturing" for natural gas. The great John Stossel has extolled the merits of fracking in his columns and broadcasts. Myself, I don't know enough about "the drilling method that uses water, sand and other additives to expand fissures in underground rocks to free oil or natural gas trapped within them." But I do know about the natural right to private property.

 A legalistic ploy like the "split estate," whereby "the right to develop oil or gas deposits is severed from the surface"—in other words, you own only the land surface, not the minerals below the surface—amounts to a lien on private property. Unless, of course, the "split estate" arrangement is clearly specified in the property deed of sale. Namely, “A” sells the land to “B,” under the condition, specified in a contract, that “A” retains rights to what’s underground.

Currently, some fracking operations are set up on the private land of hapless owners, who either did not know that "mineral rights had been sold off long before" their acquisition of said land. Or, could "still be forced to allow gas mining [on their land], if a majority of [their] neighbors sign leases with drillers."

 "Thin libertarians" think that generally approving of all technology makes them forward-thinking and ever-so hip. However, contra the angle mined by Mr. Stossel and his philosophical kin, the central problem with fracking is that it is done, for the most, in violation of homesteader, private-property rights.

 By granting permits to allow vertical penetration of someone's land with heavy equipment, state lawmakers are screwing the landowner out of his rightfully owned land and the privacy, peace and tranquility he is entitled to on that parcel of land. Clearly the problem with grants of mineral rights by state or federal lawmakers is that these grants of privilege by government, local or federal, violate the landowner's natural rights of private property.

Ilana Mercer is author of Into the Cannibal's Pot: Lessons for America from Post-Apartheid South Africa©2014 By ILANA MERCER


  1. Neighborhoods could also form neighborhood associations, whereby buying into the community came with either a fracking permit or a ban on the practice.

  2. I think the situation is more like an easement than a lien. Mineral rights are bought and sold, just like land. Where did these mineral rights originate? I suppose by legislative fiat -- but, in much of the U.S., that is no different from many surface properties.

    There is a natural conflict whenever the ownership of the subsurface minerals is severed from the surface ownership. Surface owners do in fact get compensated, but they have little recourse if the owner of the mineral rights attempts to use his or her rights (this varies by state, however). In short, it's a problem that usually gets resolved in the courts, assuming it gets that far.

    The good news is that, except where the surface lands are owned by a government entity, the fact that the mineral rights are privately owned leads to much better use of the properties - this is why the Bakken Formation of the Dakotas has been explored and is currently producing huge amounts of oil, whereas Federally-owned lands are not explored at all and are largely useless.