Dean CouchAttorney at Law

After 30-Year Wet Spell30-Year Dry Spell Coming?

STATUTES AND RULES

� 60 O.S. §60 – Water as property

� 82 O.S. §105.1 et seq. – Stream water use

� 82 O.S. §1020.1 – Groundwater use

� 82 O.S. §1085.1 – OWRB general authority

� 82 O.S. §1085.30 – Oklahoma Water Quality Standards

� Rules

� Official Oklahoma Secretary of State Title 785 OAC

� Unofficial http://www.owrb.ok.gov/util/rules/rules.php

GLOSSARY� Appropriation

� Definite stream� Beneficial use� Diversion point� Vested right

� Allocation� Groundwater� Reasonable use� Well� Prior right

� Apportionment� Interstate Stream Compacts

� Volume (acre-foot)� Flow (CFS, GPM)� Waste

CONVERSION CHARTTo convert from one water quantity

measurement to another, multiply the

existing measurement number by the

number contained in the appropriate

column at right.

CFS GPM MGD AC-

FT/YR

AC-

FT/DAY

CFS

(cubic feet per second) --- 450 .646 724 1.98

GPM

(gallons per minute) .00222 --- .00144 1.61 .00442

MGD

(million gallons per day) 1.55 695 --- 1120 3.07

AC-FT/YR

(acre-feet per year) .0014 .62 .00089 --- .00274

AC-FT/DAY

(acre-feet per day) .504 226 .326 365 ---

For example, to convert 140 million gallons per day (mgd) to cubic feet per second (cfs), you

would multiply 140 times 1.55 to come up with the desired conversion, 217 cfs.

One acre-foot of water is equivalent to 325,851 gallons.

WATER

Real or Personal Property� H2O -

Water Rights

� Ownership in place – cf. oil, gas and other minerals

� Right of use only

� Usufruct – nature of right includes not fluid itself but its uses = property right (real or personal?)

� Incoporeal hereditament – intangible, inheritable

� Own water right, but not water running in stream

� No one owns the corpus of running water

� Res communes, res nullius – property of all, property of no one (Roman law)

� Includes right to undiminished quantity and quality?

� Riparian right – natural flow or reasonable use, nuisance

Oklahoma Approach� Classification based on physical location

� 60 O.S. §60 (Property law) – water in or not in definite stream

� Groundwater (G/W) – owned by owner of the ‘land’� Water under the surface of land not forming definite str.

� 1967 – underground streams exclusion removed

� 1972 – under surface ‘outside cut bank of any definite stream’

� Diffused surface (sheet) water – owned by owner of the land� on surface, not in definite stream

� Surface/stream/lake water (S/W) – ‘public’ water� Natural channel, cut bed and banks

Diffused surface water –

may be used by owner of land,

not subject to regulation

Definite stream – natural channel

“underflow” of definitestream (outside cut bank)

Stream waternatural watercourse with defined beds and banks and

definite source of supply; perennial or intermittent

Lakes, ponds, playas = stream water� Depuy v. Hoeme, 1980 OK 26 (Wildhorse Lake playa)

Springs = stream water

Byrd’s Mill Spring – City of Ada water supplyFranco-American Charolaise, Ltd. v. OWRB, 1990 OK 44

Springs = stream water

Jimmy Creek Spring – photo from Quoetone familyOWRB v. City of Lawton, 1977 OK 89

Right to use stream water� “Public water” subject to appropriation

� Any person intending to acquire a right to the use of any water must apply for a permit

� Priority in time shall give the better right� Application filing date

� Unappropriated water available

� Beneficial use shall be the basis, measure and limit� Present or future need (anti-speculation)

� Beneficial use (reasonable intelligence, reasonable diligence): efficiency – at permit issuance only, or continuing req.?

� Notice, administrative hearing

� Remedies – complaint (river call by senior), suit for impairment� Futile call – burden on junior

RIPARIAN RIGHTS

TO REASONABLE USE� Riparian landowner – vested right of use

� No Okla. cases – “source of title” or “unity of title”

� Franco, and “reasonableness” for riparian rights� “Reasonableness is a question of fact to be determined by the court on a

case-to-case basis. Factors courts consider in determining reasonableness include the size of the stream, custom, climate, season of the year, size of the diversion, place and method of diversion, type of use and its importance to society (beneficial use), needs of other riparians, location of the diversion on the stream, the suitability of the use to the stream, and the fairness of requiring the user causing the harm to bear the loss. See Restatement (Second) Torts § 850A [1979].”

� Smith v Standolind Oil & Gas Co., 1946 OK 252� Oil company’s use off riparian premises not unreasonable per se

� Caution – right relinquished if apply for permit to appropriate

Maintaining SW Rights� After permit issued (beneficial use, anti-speculation)

� Commence works in 2 years

� Complete works

� Use water initially (7 years or SOU)

� Keep using water – once every 7 continuous years

� Efficiency upgrades for continued beneficial use?

� Annual water use reporting – accuracy, but no meters

� Changes/transfers – notice, hearing, beneficial use� Cannot affect junior appropriators

� Later priority for new amounts

� Riparian right – no loss for nonuse, may initiate or change use anytime in the future

Groundwater� Private property, but subject to regulation of use

� Kline v. OWRB, 1988 OK 18 (police power regulation)

� Cf. oil, gas and other minerals and Corp. Comm. regs

� Presume percolating – Canada v. Shawnee, 1936 OK 803

� “Use” governed by Oklahoma Groundwater Law

� Ownership severable from ‘land’ like minerals/O&G?

� Cf. EAA v. Day, 369 SW 3d 814 (Tx. 2012)

� Ownership of groundwater in place recognized

� Edwards Aquifer Authority restrictions = taking?

� Cf. Arbuckle-Simpson MAY order CV-2013-2414

Groundwater

� Under surface, outside cut bank of any definite stream (presume percolating)

Riverbank filtration wellMcKim&Creed, Florida

Groundwateroutside the cut bank of any definite stream

Cut bank of definite stream?

Permits to use groundwater� Land owned or leased by applicant must overlie basin

� Become owner of land

� Lease from owner of land (‘surface owner’ after 1985)

� Sever and own groundwater separate from surface?

� Domestic use reservation

� Use minimum surface

� Easements for surface use – well house and pipelines

� Use right – permit from OWRB

� Allocation system – surface acres overlying basin

� Max. annual yield – “regular” or “temporary” permit

� Beneficial use (reasonable intelligence, reas. diligence)

� No waste – by depletion, by pollution

Major Groundwater Basins

Straw in bucket, but reasonable regulation for reasonable use

Maintaining groundwater rights

� Unlike SW, no loss for nonuse

� Annual water use reports required

� Willful failure to report = cancellation

� “Waste” – before and after the fact� By depletion – e.g. unauthorized use

� Unpermitted well location, using more than authorized amt.

� Inefficient manner, excessive losses

� Use in a manner so water is lost to beneficial use – fracking?

� By pollution – OCC, but not ODAFF or ODEQ

� Amending permits� Add uses and place of use

� New or replacement wells

Well Interference - spacing withdrawal rate, screening, perforating

Native American Claims –

settle, or adjudicate?

s

WATER RIGHTS – OIL AND GAS

RECOVERY� Short term use – “provisional temporary permit

� 90-day term

� Stream water or groundwater

� No notice, no hearing (due process?)

� But can be cancelled at any time

� Complain to OWRB after use begins

� After-the-fact due process? (permission vs. forgiveness)

WATER RIGHTS – OIL AND GAS

RECOVERY� Who applies

� Landowner, mineral owner, operator, service company?

� Ricks Exploration v. OWRB, 1984 OK 73 (standing)

� Unit Petroleum v. OWRB, 1995 OK 73

� ‘Surface’ landowner permission after May 28, 1985

� Groundwater ‘owner’ if severed from surface

� Paying for water� Non-severed - mineral owner, free water clause in lease?

� Severed – surface owner, Surface Damages Act, transfer water well to landowner after use

� Public water in streams and ponds – pay for access, but based on barrels of water used

WATER RIGHTS – OIL AND GAS

RECOVERY� Long-term water use� Water use not within Corp. Comm. jurisdiction

� Merritt v. Corporation Comm., 1968 OK 19

� Enhanced oil recovery – OWRB rule = long-term � Cf. primary, secondary, tertiary, fracking� Special rules on enhanced recovery process

� Addressing waste (by pollution)� TCIWRA v. OWRB, 1984 OK 96� Cities Service Oil Co. v. TCIWRA, 1977 OK 176� “Pollution” defined – 82 O.S. §1084.2(1) – contamination or

alteration of physical, chemical or biological properties of any natural waters of the state

� Reduce flow, add chemicals, disposal well injection

Fracking (or Fraccing) and Use

of Water

Fracking and Use of Water� Average coalbed methane well – 50,000 – 350,000 gal. H2O

� 0.15 AF – 1 AF (1,190 bbls – 8,333 bbls.)

� Average horizontal shale gas – 2 M to 10 M gal.� 6 AF – 30.6 AF (46,550 bbls. – 237,405 bbls.)

� Value @ 5₵ bbl. – O&G $2,327 vs. 3 ac. irr. wheat gain $176� Comparisons

� Avg. household domestic – 5,000 – 10,000 gallons� 160 acres crop irrigation – 320 AF (104,272,320 gallons)� Texas County irrigation – 900 MGD ≈ NYC daily use� OKC annual use – 136,000 AF� Norman annual use – 15,000 AF

� 2% statewide use, cf. crop irrigation 40%, M&I 32%� Cumulative impact on volume and flow

Dean Couch

(405) 235-5596

dcouch@gablelaw.com