Pipeline ROW: Buy vs Lease


#1

How would you know if it’s best to have company to buy vs lease a Pipeline ROW? Or is leasing not an option?


#2

Surprised you haven’t gotten an answer to your question. There are definitely folks on this site who know more about pipelines than I do. Hopefully they will respond if they have different ideas.

My thinking is landowners generally aren’t selling, or leasing, a pipeline right of way, but are receiving a payment for granting the easement that will cover that ROW. The landowner continues to own the land that is in the ROW and the company acquiring the easement gains the right to use it under the terms spelled out in the easement agreement.

You probably know, but I’d say never accept an agreement proposed by the company wanting an easement without having an attorney review it and probably negotiate a number changes on your behalf.


#3

Are easement and right of way two different things?


#4

Ok, I will definitely get someone to look over any proposals. Thanks!


#5

Helen

Like I told Felicia, I’m no expert on this, but I’d say the term right of way is normally associated with an easement. Landowners sometimes agree to sell and convey title to a strip of land instead of granting someone an easement to use it, but I’d say those buyers are acquiring a “fee strip” of land instead of a right of way.


#6

Also, your easement should be temporary versus permanent. It can be for 10 years, then renegotiated, for example. The pipeline co should be responsible for removing the pipe when its use terminates if ever.


#7

Have an experienced Texas attorney assist you.


#8

I am not an expert, but for what it is worth, I have recently been through negotiations with a company for a gas pipeline easement (ROW) to cross my property west of Ft. Worth. The company would not consider a “temporary” easement that would be renegotiated after a period of time. However, they did agree that that should the pipeline cease to be operated or maintained for a period of 24 consecutive months, the pipeline would be deemed abandoned and the title of the ROW and easement would revert to the owner, and that the company would be responsible for removing all pipe and any other structures that might be present. I don’t have any idea what the going price is in Reeves County, but in my case (Parker County) I was originally offered approximately $240 per Rod, but after negotiations (based on some unique factors, plus the escalating property values in the area) I ultimately settled for $473 per rod.