## Facts

- Plaintiffs owned only the surface estate in a Billings County, North Dakota quarter section; their land was subject to a 1977 oil and gas lease executed by predecessors who then owned both surface and minerals.
- The lease granted the lessee exclusive surface and subsurface rights related to drilling operations and other rights necessary to conduct operations.
- A well on the tract produced from about 1979 until 2006.
- In 2003, the North Dakota Industrial Commission (NDIC) approved unitization including plaintiffs’ tract; Denbury became unit operator.
- Denbury obtained NDIC approval to convert the existing producing well into a saltwater disposal (injection) well; plaintiffs received notice of the application.
- Denbury began saltwater injection in 2011 into a deep subsurface formation; plaintiffs alleged millions of barrels were injected into pore space beneath their land.
- Plaintiffs alleged Denbury permanently used their subsurface pore space to dispose of produced water, including water originating outside the unit, without permission or compensation.
- Plaintiffs asserted claims for trespass, nuisance, and statutory damages under North Dakota’s Oil and Gas Production Damage Compensation Act (N.D.C.C. ch. 38-11.1).
- Denbury contended the mineral estate’s dominant rights and the lease authorized disposal activities, NDIC approval supported the operations, and plaintiffs lacked proof of compensable injury.

## Issues

1. Whether the lease and North Dakota law authorized Denbury to inject and permanently dispose of saltwater in subsurface pore space beneath the tract without compensating surface owners, particularly when injected fluids originated outside the unit.
2. Whether deep subsurface injection could constitute trespass or nuisance when plaintiffs had no present or imminent use of the affected formation.
3. Whether N.D.C.C. ch. 38-11.1 permits recovery for use of subsurface pore space for saltwater disposal absent surface disruption or proven diminution in value.

## Decision

- The court denied plaintiffs’ motion for partial summary judgment on liability.
- The court denied Denbury’s motion for summary judgment seeking dismissal.
- The court held the scope of Denbury’s rights under the lease and implied mineral-estate easements, especially as to disposal of outside-unit water, could not be resolved as a matter of law on the record presented.
- The court found genuine disputes of material fact on whether the injection constituted an actionable invasion and on whether plaintiffs sustained compensable injury under tort or statute.

## Legal Principles

- The mineral estate is dominant and carries an implied easement to use the surface (and some subsurface) to the extent reasonably necessary to develop and produce the leased minerals, subject to due regard for the surface owner.
- Express lease language can expand operational rights, but the scope of such rights may depend on whether the challenged activity is tied to development of the leased/unit minerals or functions as a broader disposal service for production elsewhere.
- Subsurface pore space may be treated as an interest associated with the surface estate absent a prior conveyance; unauthorized occupation of that space can support trespass or nuisance theories, depending on authorization and injury.
- Where authorization, extent of subsurface migration/occupation, and injury (including foreseeable interference or economic harm) are fact-dependent, summary judgment is improper.
- North Dakota’s surface-owner damages statute may extend beyond visible surface impacts and may cover damages from subsurface operations, but entitlement and measure of recovery can turn on compliance and proof issues requiring fact development.

## Conclusion

The court refused to decide liability on summary judgment because the lease-based and implied rights to use subsurface pore space for saltwater disposal—particularly for fluids from outside the unit—and the existence and measure of any tort or statutory injury presented unresolved factual and legal questions.


Mosser v. Denbury Res., Inc., 112 F. Supp. 3d 906 (D.N.D. 2015)