Michigan Mineral Rights - Process of Obtaining Rights

General Mineral Rights Discussion
1

I am currently carrying out a project in relation to underground gas storage in Michigan and there are a few things I was wondering wether any of you can help with.

  1. Who can grant rights underground? I have been researching a bit on this and it looks like it is the Department for Natural Resources. Who do these rights belong to? The Department? In th UK, these rights belong to the Crown, but a government department has the responsibility to grant these rights to companies.

  2. What is the regulatory/legal regime whereby these rights to underground gas are obtained? Also, what is the regime whereby one can gain access to gas storage facilities?

  3. what types of contractual documentation are needed to implement a storage project? I see that a lease must be granted, but are there any other documents which are required before underground gas storage is authorised?

Any help or pointers would be most appreciated.

2

Dear Stu,

You are asking some interesting questions.

In most United States jurisdictions, the SURFACE owner of the property (owner of the soil) also owns the interests underground, sans minerals. For example, the mineral interest owner owns the oil and gas and the surface owner owns the formation (for example, sandstone) in which the hydrocarbons are trapped, the theory being that “surface ownership” is the residual interest of fee simple with mineral rights stripped.

If you are currently “carrying out” an underground gas storage project, which is a MAJOR undertaking, you need the advice of lawyers, engineers, landmen, pipeline right of way agents, etc., before you go much further.