Theft of property

What is the responsibility of the production operator for theft of a landowner’s equipment? The operator or their contractors left our gate unlocked and open and equipment was stolen from our barn.

A lot depends on the facts and circumstances and what your specific agreement is with the operator. Often there are two locks on the gate, one for the landowner and a separate lock for the operator. Were you able to document that the operator’s lock was undone and the gate left open? Has the gate been left unlocked before and did you complain? Do you know the date or only have a range of dates when the theft occurred? What is the value of the missing equipment? Are you filing a police report and otherwise going to your insurance company? Have you talked with the operator? Some are more cooperative than others. Some will deny and demand proof that it was their employee or contractor. You should discuss how to prevent future problems. Maybe an exit sign with reminder to lock the gate. And a motion activated camera to record activity at the gate. Quality of wildlife cameras can vary but are useful in these circumstances. Certainly it would show that no one shut or locked the gate. I know a landowner who had several cows killed by oil field trucks and the operator blew him off. Then the operator needed to install a pipeline through another of his lands. He refused and so did a couple adjoining ranchers and so the company would have had to install many miles of extra lines to go around them. He made the company pay for the dead cows, agree to pay for any future dead cows and pay triple for the pipeline.

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That isn’t going to be something that is explicitly spelled out anywhere. Additionally, it is going to be nearly impossible to prove it was the oil and gas contractors that left your gate unlocked and not you. And are you sure it was because of the unlocked gate that something was stolen? Long story short, you can ask the oil and gas company, but hopefully you have insurance and that will cover it and so its a moot point.

Do you have a Surface Use Agreement? I just checked with my landman and she said to check the gate protocol section and other damages section for guidance on what to do. If it was a significant amount of items, might want to get with a lawyer too.

From a non-landman viewpoint, this is likely your best leverage. Surface owner relations are crucial to the operator not because of the legal clout they have (although you do have rights), but because they (you!) have the ability to make things difficult and expensive when some goodwill would have gone a long way.

Also, there are many times the pumpers and supervisors know the landowners (and their kids play ball together…) so keeping the landowners happy keeps the local employees happy as well (but sounds like that might not be the case here).

That said…yes, we would get some calls from landowners that were completely 100% our fault and we’d do what we could to make it right. But in TennisDaze’s example, I feel a little sympathy for the oil company since the cow calls are the hardest. It’s always the “prized cow” that was somehow injured in a way that couldn’t be proved, and the volume of calls would always go up when activity went down (as in, when we were drilling less and paying less surface damage payments). Just know that there are landowners making things difficult on the operator, if you get any push back. It’s just them filtering out the wheat from the chaff. Keep pushing!

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