Stephens Production Co., a Division of SF Holding Corp. v. Larsen, 394 P.3d 1262

Stephens Production sought to condemn underground gas storage easements and surface easements in the Hunton Formation beneath ~900 acres in Haskell County pursuant to Oklahoma's Underground Storage of Gas statutes; the Oklahoma Corporation Commission had approved the project as in the public interest.
The Reservoir is a single, porous limestone formation ~6,000 feet deep, spanning ~459.9 reservoir acres; Larsen owned an 80-acre parcel that represented 68.4 reservoir acres (14.87% of the reservoir acreage).
The taking was an underground storage easement under Larsen’s land plus a nonexclusive surface easement; Stephens did not plan any surface wells or pipelines on Larsen’s parcel.
Commissioners valued Larsen’s award at $12,400; at bench trial Larsen’s expert valued just compensation at ~$419,000 (based on a fully developed storage facility), Stephens’ expert at $9,000; the trial court awarded $9,000.
Larsen appealed; the Oklahoma Supreme Court granted certiorari to address whether speculative value from a combined reservoir development may be included in just compensation when the individual parcel has no independent utility for storage.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether owner may recover increased value based on proposed combined use (underground gas storage) that requires aggregation of multiple parcels	Stephens: Market value must reflect existing market and any reasonably probable uses; no evidence of a market or reasonable probability of combination, so speculative project value should be excluded	Larsen: Value should include the parcel’s pro rata share of the value of the completed storage facility (highest-and-best use based on the project)	Court held speculative combined-use value cannot be included absent evidence of reasonable probability of combination or market demand; excluded Larsen’s project-based valuation
Whether the trial court’s $9,000 award was supported by competent evidence and proper legal standard	Stephens: Trial court reasonably relied on expert sales-comparison and lack of comparable storage-market activity; award supported by evidence and discretion of factfinder	Larsen: Trial court erred by undervaluing and ignoring expert appraisal premised on completed facility	Court affirmed: trial court’s factual findings are entitled to deference in bench trial and there was competent evidence to support $9,000 award

Eichman v. Oklahoma City, 202 P. 184 (Okla. 1921) (condemnee cannot recover speculative increase in value based on proposed unproven combination or project)
Soldan v. Stone Video, 988 P.2d 1268 (Okla. 1999) (bench-trial findings entitled to same weight as jury verdict)
Mueggenborg v. Walling, 836 P.2d 112 (Okla. 1992) (trial court best positioned to judge witness credibility)
State ex rel. Dep’t of Transp. v. Lamar Advertising of Okla., 335 P.3d 771 (Okla. 2014) (condemnation principles; burden shifts to landowner to prove fair market value)
Arkansas La. Gas Co. v. Latham, 650 P.2d 49 (Okla. 1982) (landowners condemned for underground storage are entitled to just compensation)
Olson v. United States, 292 U.S. 246 (U.S. 1934) (physical adaptability alone does not affect market value absent reasonable probability the owner could combine tracts for that use)