Pipelines
What You Need to Know about Pipeline Projects
Pipeline projects typically involve the taking of pipeline easements across private land for the installation, maintenance, and operation of pipelines and appurtenant facilities, most often sought by large oil companies, pipeline companies, or public utility companies. Appurtenant facilities can include above-ground facilities ranging from small pipeline markers to sizable buildings housing large banks of engines and pumps, valves, meters, other equipment, and personnel.
Some pipeline projects in Ohio have the power of eminent domain, and some do not. “Eminent Domain” is a legal term that refers to the power of the government and certain private companies to take private property and convert it to a public use. It is essential that a landowner impacted by a pipeline project know whether that project has the power of eminent domain in order to obtain the best possible results.
Projects with the Power of Eminent Domain
The act of exercising eminent domain power is commonly referred to as “Appropriation” or “Condemnation.” The government may also delegate its power of eminent domain to private companies for for-profit projects deemed to serve the public’s interest, such as certain types of pipelines, power lines, and railroads. Many large pipeline projects in Ohio today have the power of eminent domain. The entity taking land by eminent domain, whether the government or a private pipeline company, is referred to as the “Condemning Authority.”
In many cases, when the landowner first learns that a condemning authority is planning to take their land, the first question is: ‘Can I stop this?’ The answer is, while there are procedures available to landowners to attempt to stop eminent domain projects, under Ohio law the use of eminent domain for pipeline projects deemed to serve the public’s interest can rarely be stopped. Nevertheless, landowners still have many important rights.
The power of eminent domain is not absolute, and is limited by the the Fifth Amendment to the U.S. Constitution and Article 1, Section 19 of the Ohio Constitution. The Fifth Amendment requires that when a condemning authority exercises its eminent domain power, it must pay just compensation to the landowner. The Ohio Constitution further extends the rights of the landowner to provide that just compensation shall be assessed by a jury. So, where a pipeline project has the power of eminent domain, the key issues for an impacted landowner are (1) the amount of just compensation to be paid and (2) the contractual pipeline easement terms the pipeline company must follow in exercising its eminent domain power and constructing its pipeline.
Projects without the Power of Eminent Domain
Not all pipelines projects have the power of eminent domain. Pipelines that are not deemed to serve the public’s interest do not have the power of eminent domain. These can include pipelines designed to serve a single customer, oil and gas well gathering lines, and pipelines designed to transport certain types of materials that are not deemed to serve the public’s interest.
The most common pipelines being constructed in Ohio today without the power of eminent domain are pipelines that connect individual gas well pads to the larger natural gas transmission system. These pipelines are referred to as “gathering lines” or “well connect pipelines.”
If a well pad is being constructed near your property and you are contacted by a company that wants to construct a pipeline across your property, there is a good chance that the company does not have the power of eminent domain. This is important to know because it will impact the negotiation substantially. If the company does not have the power of eminent domain, then it can only build the pipeline across your property if you agree to grant an easement.
Often granting a pipeline easement in this circumstance can be financially lucrative, but only if landowners know their rights, know the market, and know the easement terms they need to protect their property.
Whether the pipeline project you are facing has the power of eminent domain or not, you should keep in mind that the landowner does not start on a level playing field with the pipeline company. Pipeline companies are involved in taking pipeline easements from landowners every day. They have numerous attorney's and land agents on their side working to take pipeline easements that benefit themselves - not the landowner. If the company has the power of eminent domain for its project, it will be willing to fight you in court to take the pipeline easement they want on your land.
Landowners facing a pipeline project need an experienced pipeline attorney. An experienced pipeline attorney levels the playing field for the landowner and gives the landowner the best opportunity to obtain an excellent result. At GBSK, we know the law and have squared off against pipeline companies across the state in court and in negotiations. We have represented hundreds of landowners who faced pipeline projects impacting their land and have achieved highly favorable results. See what our clients say about us on our Testimonials page.
Please continue reading below for more information on how we can help, or click below for a free consultation.
How We Help
When faced with a pipeline project, it is common for property owners to focus most of their attention on monetary compensation. Although important, monetary compensation is only one aspect of a pipeline project. We provide value to our clients through three distinct, interrelated services:
1. Obtaining Monetary Compensation – The primary remedy for a landowner facing a pipeline project on their property is the payment of compensation. If the pipeline project has the power of eminent domain, the landowner is entitled to just compensation for the land taken and the damages to the residue (the remaining property), which may be obtained through negotiations or a jury trial. If the pipeline project does not have the power of eminent domain, the compensation to be paid is entirely the product of negotiations. We work with our clients and our extensive network of experts to determine if there are any flaws in the pipeline company’s compensation offer. If we conclude that the pipeline company’s offer is too low, we negotiate diligently on our client’s behalf to obtain higher compensation. If the pipeline company has the power of eminent domain and no settlement is reached, we obtain eminent domain expert appraisers to perform appraisals and to evaluate any other land use or engineering concerns on behalf of our client. The appraisal then forms the basis of our legal position at trial. In addition, we are skilled trial attorneys who welcome the opportunity to go to trial if necessary to achieve the best result for our client.
2. Negotiating Contractual Terms – Regardless of whether the pipeline company has the power of eminent domain, it is often possible to negotiate modifications to project plans and to obtain other contractual terms to mitigate the landowner’s damages and protect the future uses and value of the land. At the commencement of our representation, we discuss with our clients what modifications to the project plans or other terms would be most beneficial, as well as educate our clients on important additional terms that should be included, and then we work diligently to obtain those changes through negotiations with the pipeline company.
3. Enforcing Contractual Terms – After the contractual terms are negotiated, we stand with our clients every step of the way to ensure that the pipeline company complies with its duties and obligations in carrying out the plans and any other contractual terms, both during construction and in the future. If the pipeline company fails to meet its obligations, we assist our clients in taking the necessary enforcement action. See Our Results for examples of such enforcement action.
To view some of the pipeline projects in which we are involved, please click the link below: