Newman v. RAG Wyoming Land Co
In Newman v. RAG Wyoming Land Co., 2002 WY 132, 53 P.3d 540, the Court considered whether or not coalbed methane gas (CBM) had been conveyed or reserved by landowners in a 1974 land conveyance.
In Newman, the grantors owned both the surface and mineral estate in certain Campbell County property and deeded the surface of such property and "coal and minerals commingled with the coal" to a neighboring coal mine operator reserving all "oil, gas, and other minerals" not otherwise conveyed.
In Newman, the Court began our analysis by setting forth the historical background of CBM.
In particular, the Court recognized that CBM had been well known for over a century and had long been considered a dangerous waste product of coal mining until the 1970s.
At that time, the value of CBM was realized resulting in concerted research and development in the area through the issuance of government grants.
Nevertheless, it was not until the early 1990s that techniques were perfected for the efficient development of CBM.
Prior to this time, CBM was simply allowed to escape from the coal in the course of open pit surface mining, and no attempt was made to capture it as a valuable resource. Newman, at PP6-8.
Newman further explored the chemistry and composition of CBM.
In doing so, the Court recognized that CBM is chemically identical (CH4) to gas produced through conventional methods.
Both CBM and gas produced from conventional methods are known as "natural gas" and emanate from the decay of organic material over time under great pressure and temperature. CBM gas exists in coal in three basic states: as free gas; as gas dissolved in the water in coal; and as gas "absorbed" on the solid surface of the coal.