Columbia Gas Transmission Corp. v. Exclusive Gas Storage Easement, s. 84-3094

CourtUnited States Courts of Appeals. United States Court of Appeals (6th Circuit)
Citation776 F.2d 125
Docket NumberNos. 84-3094,84-3120,s. 84-3094
PartiesCOLUMBIA GAS TRANSMISSION CORP., Plaintiff-Appellant, Cross-Appellee, v. An EXCLUSIVE GAS STORAGE EASEMENT, et al., Defendants-Appellees, Cross-Appellants.
Decision Date30 October 1985

Kenneth E. Tawney, H.L. Snyder, argued, Charleston, W.Va., David D. Noble, Noble & Hines, Millersburg, Ohio, for plaintiff-appellant, cross-appellee.

James DeWeese, argued, Inscore, Rinehardt & Whitney, Mansfield, Ohio, Robert P. DeSanto, Stanley Morris Parrott, William Andrew Parrott, Lela Iona Hipp, Clyde Hipp, Beulah Parrott, for defendants-appellees, cross-appellants.

Before ENGEL and JONES, Circuit Judges, and EDWARDS, Senior Circuit Judge.

GEORGE CLIFTON EDWARDS, Jr., Senior Circuit Judge.

Columbia Gas Transmission Corporation is one of the largest gas pipeline companies in the United States. As part of its gas supply system, it operates a gas storage system in southeastern Ohio. In the instant action, Columbia, without seeking amendment of its certificate of public convenience and necessity, sought to condemn an easement for underground storage of Principally involved in this appeal is a certificate of public convenience and necessity obtained by Columbia in Richland and Ashland Counties of Ohio and originally issued February 6, 1953 to Ohio Fuel Gas Company, a predecessor gas company, by the Federal Power Commission, predecessor to the Federal Regulatory Commission. This certificate was based on information in the application which by map outlined an area of land one to two miles from the boundaries of defendants' land. The portion of Columbia's existing storage facility at issue here is called the Weaver 3-F pool.

natural gas under the property owned by defendants Parrotts and their associates. Columbia says that it had previously sought to lease such an easement but had been unable to arrive at a satisfactory bargain. District Judge Dowd heard this case and wrote a careful opinion published at 578 F.Supp. 930 (N.D.Ohio 1983) denying Columbia's right to condemn defendant-appellees' subsurface rights absent amendment of its certificate of convenience and necessity.

The Parrotts want to drill to extract what they claim to be native natural gas lying under their land. Columbia claims that the gas underlying the Parrotts' land is stored gas which has seeped there from Columbia's Weaver 3-F pool. 1

Columbia's appeal as presented to this court contends that by possession of a certificate of public convenience and necessity for development of a gas storage easement on a tract of land one to two miles away, it can legally condemn and then make use of the subterranean structures below the Parrott's land, and beyond any land described by the 1953 certificate, without any further permission by the Federal Energy Regulatory Commission. Columbia recognizes that it must condemn the Parrott's underground rights. It claims, however, that the Weaver 3-F pool actually extends under the Parrotts' land, either as a result of underground passages or porosity and that the 1953 certificate of public convenience and necessity for the Weaver 3-F pool is sufficient support for its proposed condemnation action.

The Parrotts also appeal from the district court's opinion to the extent that it holds that the Natural Gas Act, 15 U.S.C. Sec. 717f(h) authorizes the use of eminent domain authority for condemnation of gas storage easements. Their contention on their cross appeal is that there is simply no language in the Natural Gas Act which refers to condemnation for gas storage purposes. They also vigorously disagree with Columbia's argument that its gas now underlies their land.

The District Judge made the following findings of fact:

FINDINGS OF FACT

1. Columbia is a Delaware Corporation engaged in the production, purchase, storage, and interstate transportation and sale of natural gas in interstate commerce in the states of Kentucky, Maryland, New York, Ohio, Pennsylvania, Virginia, and West Virginia. Columbia's principal place of business is located in Charleston, West Virginia.

2. Columbia operates underground storage fields as an integral part of its natural gas transmission function. Columbia must store excess gas during the summer for use during the winter when cold weather causes market demands to exceed the capacity of production and transmission pipelines. Columbia could not produce adequate supplies of natural gas for its wholesale customers and through them to the gas consuming public without the use of underground storage facilities.

3. Columbia operates a natural gas storage field in Richland and Ashland Counties of Ohio which is known as the Weaver Storage Field. Within the Weaver Storage Field is a gas storage pool which is known as the Weaver 3-F pool.

4. The gas in the Weaver Field is stored in a geological formation known as the Clinton formation, which is a porous and permeable 2 layer of rock approximately 2,900 feet beneath the earth's surface.

5. A certificate of public convenience and necessity was issued on February 6, 1953 to the Ohio Fuel Gas Company, predecessor Company of Columbia, by the Federal Power Commission, predecessor agency of the Federal Energy Regulatory Commission.

6. The certificate of public convenience and necessity was issued based on the information in the application before the Federal Power Commission. The application before the Federal Power Commission included a map outlining an area of land in Ashland and Richland Counties, Ohio.

7. The tract of land owned by the defendants is not within the boundaries of the Weaver Field as set forth on the map included in the application for the certificate of public convenience and necessity which was presented to the Federal Power Commission.

578 F.Supp. 930, 932 (N.D.Ohio 1983).

As to the contentions advanced by appellant Columbia and by cross-appellant Parrotts, the District Judge said in part:

2. The power of eminent domain given to a holder of a certificate of public convenience and necessity, to obtain an easement for the underground storage of natural gas, extends only to the property located within the geographical area designated on the map or maps attached to the application for the certificate of public convenience and necessity as required by 18 C.F.R. Sec. 157.14(a)(6).

3. As the property of the defendants, i.e. the Parrott property, is not within the designated area of the certificate of public convenience and necessity issued to Columbia, Columbia does not have the right to acquire an easement for the underground storage of natural gas on the Parrott property by the power of eminent domain.

Id.

We affirm the District Court on both issues.

I. Columbia's Claim of a Right to Condemn Under the 1953 Certificate

In 1953, Ohio Fuel Gas Company, a predecessor of Columbia, obtained a certificate of public convenience and necessity to develop a storage pool in the Weaver field. The new pool, Weaver 3-F, was to be located in Richland and Ashland Counties. The portion of the Weaver 3-F facilities in Ashland County was located primarily in Sections 17 and 18 of Hanover Township. Parrotts' tract is located one to two miles east of the pool as described in the application. In the application submitted in 1953, the Weaver 3-F pool's size, location, and boundaries were estimated on the basis of the then available geological and engineering data. The certificate of public convenience and necessity issued by the Federal Power Commission in 1953 specifically incorporated Ohio Fuel Gas...

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