Wyoming Supreme Court Punts on Potential BLM “First in Time, First in Right” Interpretation of Competing Mineral Developers

A recent case before the Wyoming Supreme Court failed to clarify what, if any, remedies are available to conflicting developers of federal mineral rights on overlapping lands. Rather, the Court’s ruling in Berenergy Corporation v. BTU Western Resources, Inc.; School Creek Coal Resources, LLC; and Peabody Powder River Mining, LLC, and BTU Western Resources, Inc.; School Creek Coal Resources, LLC; and Peabody Powder River Mining, LLC v. Berenergy Corporation1 stated it could not decide the issue, while not so subtly asking the Secretary of the Interior and Bureau of Land Management (BLM), which could decide, to no longer “sit this one out.”

Berenergy Corporation (Berenergy) owned three oil and gas leases granted by the BLM. Berenergy originally filed for a declaratory judgment that the rights under its leases were superior to those under coal leases on overlapping lands that the BLM had issued later to affiliates of Peabody Energy Corporation (Peabody). Berenergy sought to prevent Peabody from shutting down Berenergy’s wells for fifteen to twenty years while Peabody mined areas in the overlapping land, and to prevent interference with Berenergy’s operations, including plans to water-flood oil-bearing formations covered in its leases.

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