## Facts

- Cynthia A. Soames owned land in Miami County, Indiana containing three oil wells.
- In 1997, Soames leased the property to Young Oil Company to operate the wells; Young obtained required state permits and operated the wells for several years.
- In 1998, Soames sued Young for breach of the lease, leading to extended civil litigation.
- By 2005, production ceased after a court order effectively terminated the lease relationship; the wells were no longer operated for their permitted purpose.
- In 2007, the Indiana Department of Natural Resources (DNR) issued Notices of Violation to Young for failing to comply with oil-and-gas rules requiring non-operational wells to be properly addressed (operate, qualify for temporary abandonment, or plug).
- Young sought administrative review, asserting it was impeded by the private dispute and Soames’s conduct, including denial of access to the property.
- An Administrative Law Judge ordered the wells plugged; the Natural Resources Commission (NRC) adopted the findings and issued a final order requiring plugging and directing Soames to refrain from interfering with Young’s plugging efforts.
- Soames sought judicial review; the trial court affirmed the NRC’s final order, and Soames appealed.

## Issues

1. Whether the NRC abused its discretion by ordering the three wells to be plugged because they were no longer operated for their permitted purpose and did not qualify for temporary abandonment.
2. Whether the NRC exceeded its statutory authority by ordering Soames to refrain from interfering with Young’s access to enter the property to perform plugging required by regulation.

## Decision

- The Indiana Court of Appeals affirmed the trial court’s denial of judicial review and upheld the NRC’s final order.
- The court held the NRC did not abuse its discretion in ordering plugging where the wells were idle and the requirements for temporary abandonment were not met.
- The court held the NRC acted within its authority by directing Soames not to interfere with the operator’s access needed to complete plugging required by public regulations.

## Legal Principles

- An agency’s interpretation of statutes and regulations it administers receives substantial judicial deference and will be upheld if consistent with the governing text and regulatory purpose.
- Under Indiana oil-and-gas regulation, a permitted well that is no longer operated for its permitted purpose must be either properly placed into temporary abandonment status under specified conditions or plugged and abandoned.
- On judicial review of agency action, courts apply a deferential standard: the decision must be supported by substantial evidence and not constitute an abuse of discretion; courts do not reweigh evidence.
- An agency may issue compliance orders that require a landowner to refrain from obstructing an operator’s limited entry necessary to perform mandated plugging, where such non-interference is necessary to effectuate environmental and safety requirements and does not adjudicate private contract rights.

## Conclusion

The court upheld the NRC’s plugging and non-interference order because the wells had been idle for years, temporary abandonment requirements were not satisfied, and the agency reasonably ensured regulatory compliance by preventing the landowner from blocking the operator’s access to plug the wells.


Soames v. Ind. Dep’t of Nat. Res., 934 N.E.2d 1154 (Ind. Ct. App. 2010)