The Ohio Dormant Mineral Act – Clear as Mud

As most now know, the Ohio legislature has created a mechanism by which owners of land can recover their oil and gas rights if the owner of the oil and gas rights has failed to take the proper steps to maintain their rights.  What many do not know is that there are two different versions of the statute that can drastically alter the legal analysis as to who owns the mineral rights.

The current version of the Dormant Mineral Act was enacted in 2006.  It provides that the surface owner can recover a severed oil and gas interest without going to court if the mineral owner has failed to meet certain criteria and the surface owner notifies the mineral owner of his or her intention to recover the mineral rights via the statute.  This notice must be done via certified mail, but often results in newspaper publication when the mineral owner cannot be located.  The surface owner then files an affidavit with the county recorder’s office between 30 and 60 days after the notice.  If the mineral owner takes no action within 60 days of the notice, the surface owner becomes the owner of the oil and gas rights.  The mineral owner can put a stop to this process by filing an affidavit with the recorder’s office within 60 days of the notice setting forth a savings event or stating that he or she intends to preserve, not abandon, the mineral rights.

The 2006 Dormant Mineral Act is actually a revision to the original Dormant Mineral Act which was enacted in 1989.  Via the 1989 Act, a surface owner automatically became vested with the mineral rights in his or her property if the mineral owner failed to meet certain criteria in the previous 20 year period.  No notice to the mineral owner was necessary.  While this may give rise to some Due Process concerns, the United States Supreme Court held that a similar statute in Indiana did not violate the mineral owner’s Constitutional rights.  Nonetheless, the Ohio legislature thought it wise to amend the statute to add clarity to property owner’s rights.  That clarity is yet to be achieved.

The lesson to be learned is simple:  just because a mineral owner has filed a claim to preserve their mineral interest does not mean that the battle is over.  Several courts in Ohio have ruled that the 1989 Act rendered the 2006 Act moot if the 1989 abandonment conditions were met prior to the passage of the 2006 Act.