*1 TEXAS RAILROAD OF COMMISSION BASS. Austin. Texas. 27, 1928. Rehearing,
On Nov. A. former Prank M. Gen., former Asst. Claude Pol-
lard, Atty. Brown, and Joe S. appellant. . Austin, Geo. McCDENDON, from a final appellee (plaintiff awarding below) permanent injunction restraining Rail- members, agents, road em- ployees, representatives enforcing “Oil and Gas Conservation Rule No. 37” against respect acres 3½ instituting land, and from suits to penalties for the collect violation that rule of. respect parties designated as in court below. questioned constitutionality (chapter 155, statute General Daws of 1919), conferring promulgated, which rule 37 was *2 587 mining strip. regulatory power lands to the of to the lands were the These with reference gas. proven territory the all in of in and to the submission Prior City field, case, Denison was known of What as the Powell Dallas the Municipal Co., long had de- was some 6 miles and mile 257 S. about one Gas upholding question, The north end was wide. of tract cided constitutional Legislature middle simi- near the of the end of confer the field and the to the extremity. powers upon its Commission. near southern Atlantic the Railroad lar Supreme permission being had the Court on from the before That granted, bar at drill ten of we held Railroad Commission to writ error the pending Supreme line; feet from north submission the 150 well west the being decision, ren- 150 has now been from the north line and Court’s feet dered, apart. permission upholding 3 S.W. 300 Like Dallas the others feet the court. Humble, Gulf, (2d) and had Skelly Companies the drill ten These wells. and unen- trial court held void First, approximately grounds: it located were of 150 feet east forceable on two spaced powers delegated, and the the line about did not come within Commission; Legislature Company. same as of Atlantic It to Railroad the the to the applied permission and, second, because, land when was seems wells, of it' these the owners the leases was unreasonable. suit, claiming plaintiff’s strip, filing conse- the and of quently the west line was of land of leasehold the owners the interest brought question assumed to federal line suit in the damages land court at Dallas, seeking the east. the leasehold interests on plied to the commission for of members along company holding drill ten wells the the center of the on an oil property, alleging leases 150 feet from the first line the north apart. permis- question and the others 300 feet land in resulted the rule the refused, giv- great injury first the was to them owners of en near drill two the that case constitution mineral ality lease. the center and one the south end of towards the 1919 and act of strip; brought question. and later was of rule 37 were ness one 150 Co. to the north others feet from [Oxford Oil The federal District other,near F.(2) Producing Co., 639] the center. 16 v. Atlantic Oil & spaced, beginning These four wells Fifth the Circuit Court feet; F.(2d) [Id., line as the north the second follows: first 150 held consti 597] 22 the act Circuit first; 1,063, and en or 913 and the rule reasonable tutional second; 1,220, Supreme third or feet 157 Court of the United forceable. 2,126, and the fourth or of cer- States denied an for a writ third. 72 L. --. We tiorari. S. Ct. Ed. Rule 37 reads: in so overrule the the trial court decision legis not far as holds the rule within “No oil shall or hereafter grant, generally, lative or unreasonable (300) nearer drilled any than three feet hundred authority of cited decisions of completed drilling other or on the federal courts. farm; or' tract or and no well Ap- opinion by In the Circuit Court shall be than one drilled nearer hundred fifty any line; (150) provided peals feet we read: that the in order to waste arbitrary complain “Plaintiffs do not rights, grant exceptions toor vested will power, exercise but that the drilling permitting as above shorter within distances adopt authority Commission was without fully upon application prescribed, filed enforce rule.” facts, stating notice thereof first given Rule adjacent lessees been by. to all affected there- that; manifest, therefore, the reason- 3,7 present It shall not for be en- tract rule as proven ableness fields oil Gulf forced within adjudicated question not of land Coast.” inquiry will and our the federal basis, question. solely This rule a conservation directed promulgated purposes, expert testimony Other hazard, later, controlling mini- the fire the other facts reduce mize the dealt with danger percolation into the hndisputed, of water follow: great part oil stratum too owner an oil and Plaintiff is proximity. number, or in covering too close wit- of land feet wide the south nesses 56.7 lease regulation agree end, some feet north wide at 35.9 long. essential, and that it- end, Company the rule Oil character The Atlantic practical covering mineral lease holds self gas mining development indus- Refin- Humble Oil west of try. Company, sand.of char- ing shown that Gulf Production covering field a well Shelly of the stratum will hold Oil leases acter acres, plaintiff’s land, or 660 feet the area and general drain- outline (cid:127) question permits .square. location, The rule the location square, parts proven drilling upon every field, of well relative prohibits drilling distances the owner from to the" common line of *3 Manifestly property plaintiff’s his authorized 160 feet of rule, tion, line. to wells and those author- ques- strictly applied adjoining tracts, plaintiff ized on if would any drilling equal opportunity of have an would developing realizing no well of the as leaseholders of .the narrow width put from his leasehold. as 150 feet the east could far rule, however, The west lines. reserves Railroad Commission al ready pre- right, “in order to in the commission the vent waste make authorized the ten wells on the west vested, rights,” or to to and ten on the com east distances from the particular situations, property considerably exceptions greater mon fit lines grant in closer one-half to drill wells the width of the the reason prescribes generally, proximity limiting plaintiff ableness of rule to a less number adjacent than an this the commission has done offset well each and case. of these ins depends upon whether, considering wells theory plaintiff appears factors, to be above-enumerated right give that he had a an offset as matter of to drill would law him opportunity of the wells same each to extract oil from the field property .adjacent his east and that would have if lines. offset expert testimony applied equally From the mass of both toas number and record, appears right plaintiff adjacent to drill distance between offset own recognized clearly generally in this ers. The wells of character shows is evidence mining. however, right, contemplates just Commissionwas fair and plaintiff viewpoint. common that the joining line between ad The commis charged duty leaseholds shall bisect the distance with the adminis tering giving between offset chance each the the conservation same act and at the same beyond draining administering line time was it to rec ognize Theoretically, rights its owner. so far .of the vested owners. There prac determine, has is been able to abundant evidence in the record to show tically, fairly justly that it and of two offset wells will drain acted point midway that, acreage by considering between the two. Since owned plaintiff, Company shape, unusual the ed wells to the east of the Atlantic wells locat its relation field, plaintiff plaintiff’s.west to. the oil line, been accorded ample opportunity in the wells author four east were from 94 to by line, ized to be drilled him extract as much whereas reasonably necessity oil from the field as he could must of wells from 28 to expected application property lines, to under fair of these -it manifest principle. offset well permit The commission is an that to to drill an offset body, pair administrative ings its orders and rul to each of on the east and ten wells upheld clearly must be unless sides his tract would unjust. give advantage shown to be unreasonable or an him unfair over the owners wholly record as lands, we view it fails to show -unlessthe latter were unfairness, unjustness, turn to drill or unreasonableness offset wells the rule, plaintiff’s. and to the com distance the division line as This, however, thereunder, placing mission’s orders rights. would result proximity in much wells than rule 37 closer to each other judgment authorizes, trial court and would is there- create' reversed, judgment quite' congested justified fore field. It could here rendered appellants, only dissolving in favor of tion to case the commission had granted by plaintiff’s application, denying event, the trial in which under appellee any sought. theory, adjoifiing of the relief own Reversed demand, rendered. be entitled to and no doubt drill, would have been set line as off the same distance from Rehearing. . On Motion plaintiff’s. Concedinggenerally right Appellee, rehearing, to drill his motion for that, points offset think origi- where the out certain bound inaccuracies aries of a tract are so nal delineated as to which we re now correct: quire, general purposes permit by the interest of There was in fact no issued exception an to or limitation the Railroad Commissionto the Atlantic Oil right, that enforce such always compa- has the on the west or several exception limitation, provided appellee’s nies on the east of just, fair, its order is cedure seems to be reasonable. where rule 37 is proper complied with, We also think the test of no to drill is .permit 'neces- taking be;whether, sary. only ness to into consideration where the owner an desires Frank M. exception is made W. A. Former to rule 37 that Pol- Former Claude of the Atlantic commission. Atty. lard, Brown, Asst. Joe S. accordance strict Gen., for companies with rule 37. The wells holding and Geo. the east leaseholds Austin, for attempted accordance drilled in land were assumption rule mistaken an inter- holdings coin- the west line locutory injunction. granting Atlantic hold- the east line of the cident with appeal order the ings. these wells view of fact on mer- was tried in court below good perpetual. its, faith under these circum- were drilled made appeal was taken an stances, Railroad From this latter no action taken judgment re- and the trial court’s *4 37. for violation of rule Commission versed, in favor rendered appellees Our were first 2. statement pellants, No. below. See the defendants given later wells and etc., 6832, J. G. v. upon our additional wells was two day S.W.(2d) 586, Bass, decided. order, of the second which construction holding controls in the in cause No. 6832 amendatory of first or- that it vided appealed appeal therefore at bar.' The injunc- the fact that aside, Our is called to attention der. this matter of set up pleadings tion dissolved. is cleared Injunction dissolved. which show the second order was intended under the relocate the two error, we now first order. To correct find Appellants, al., et E. Clarence GILMORE that under the two orders Receiver, STRAUGHAN, al., et Jas. P. granted permission two Appellees. (No. 6831.) feet, respectively, Appeals of Texas. Austin. Civil north line. 27, June 1928. Appellee contends corrected should statement of the record we affirm the 14, Rehearing 1928. Denied Nov. holding trial court’s order was un- We reasonable land. do not concur in this contention. The first M. Frank' well near center A.W. Atty. Gen., for of the tract and the end. other near Short, Hanger Capps, Cantey, James & & The'evidence shows that a well at the latter location Chizum, Conner, Phillips, Trammell & Evan have been of no value appellees. Worth, McCord, Fort S. would not have been drilled. The lease most valuable northern end of the the companion tract and the value decreased toward 6832, Railroad Commission of cause No. manifestly south. The case was tried day (2d) 586, Bass, 10 S.W. v. J. G. Texas sufficiency of the two wells opinion in No. cause decided. We refer 6832 for a statement the second order of commis- facts and conclu- sion to meet the test of We reasonableness. cause, all of in that which of law reached sions order, find that wells in the second applicable here. placed they were, met the same appellees condition the instant case fairness, justness, strip as to in the Pow- reasonableness of the narrow 6832, original opinion and at- No. Gas Conservation our oil field involved with ell found validity 29, of Oil and tack Rule No. wells from line” until original reference the four wells under our gas of oil or inhibits owners construction of two orders. “connecting pipe With above corrections the state- they secured from have original opinion, ment the motion for compliance showing certificate rehearing is overruled. con- conservation laws with servation after Original opinion corrected. Motion over- Appellees, the commission. orders of ruled. had obtained to the enforce- reference the trial court with three wells ment rule and or- in violation of the opin- referred to in commission ders Magnolia Petroleum in cause No. 6832. ion al., RAILROAD COMMISSION OF TEXAS et defendants, below, declined Appellants, Appellee. BASS, v. J. G. pipe these wells until lines with to connect plaintiffs rule The the certificate give. 29, purpose declined to of Texas. Austin. suit was to obtain of this avoiding re- the effect of relief tive quiring company pipe make the nec- essary unauthorized three connections