The Rule of Capture, Explained

If you own land in Texas, you might be surprised to learn that the minerals beneath your property don’t always stay put. Oil, natural gas, and groundwater can move underground from one property to another. So, what happens when these resources shift from your land to your neighbor’s? The answer lies in a principle called the rule of capture, a key idea in property law that decides who owns the oil, gas, and other minerals found beneath the ground. 

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Although many states don’t use this rule, Texas does. To learn about your rights to the mineral rights beneath your personal property, you should contact a mineral broker who understands your state’s specific laws. Keep reading to learn about how the rule of capture can impact ownership rights.

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Key Takeaways

• The rule of capture is a property law principle that gives rightful ownership to whoever extracts underground resources first. 
• The rule of capture applies to oil, natural gas, water, and even wild animals. 
• Natural resources can legally be removed even if they originated under someone else’s property. 
• Working with a trusted mineral broker like The Mineral Auction can help you sell your mineral rights for fair market value. 

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What Is the Rule of Capture for Ownership Rights?

The rule of capture is a key rule affecting ownership of gas or oil in a common reservoir. In simple terms, the rule of capture property law is a principle that determines who owns certain mineral rights. Under this rule, if mineral resources are present under your land and you manage to collect them by drilling a well, they legally belong to you, even if they originally came from beneath your neighbor’s property.

This principle commonly applies to three main categories of resources:

• Mineral resources like oil and natural gas flowing through underground reservoirs
• Groundwater moving through aquifers beneath the surface
• Wild animals that move freely across property lines, since they can't be owned until actual capture

The rule of capture was first used in English Common Law to explain ownership of wild animals and flowing water coming from another’s land. Back then, if someone captured a wild animal that was free to roam, they considered it their property. The same idea was later applied to underground resources, such as oil and gas, which naturally flow through porous rock between adjacent landowners.

Captured natural resources are still governed by this rule. Today, water ownership and regulation in Texas are heavily dictated by groundwater conservation districts and the Texas Water Code, but the rule of capture still applies.

The rule of capture creates a strong motivator for development and production. Without this rule, there could be a considerable amount of confusion over who truly owns the resources underground.

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How Does the Property Law Capture Rule Apply to the Oil and Gas Industry?

Oil and gas extraction is where the rule of capture has the biggest impact on property rights. When companies drill for oil or gas, they often drill underground reservoirs that stretch beneath multiple properties. Because these resources can move freely underground, it’s not always clear which portion belongs to which landowner.

The rule of capture property law answers the question by granting ownership of the gas produced to the first person who drills and produces the resource, regardless of where the oil originated underground. So, if a company drills a well on property it owns or leases, and the oil or gas it pumps comes partly from beneath another owner’s land, the first company is still the true owner, because it captured the resources first.

This creates what industry experts call the "law of the biggest pump." Property owners have an incentive to drill wells and extract resources quickly before their neighbors do the same. Without action, a landowner could watch valuable minerals drain away from beneath their feet, flowing to a neighbor's well with no compensation required. This competitive pressure often makes landowners develop their mineral resources sooner rather than later.

However, property owners must still follow state regulations about drilling practices and cannot deliberately make their wells reach minerals under someone else's property. This illegal practice, called "slant drilling," crosses the line from exercising capture rights to trespassing underground.

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Protect Your Mineral Rights With the Mineral Auction

The rule of capture can impact how mineral ownership is practiced. While you may own the minerals beneath your land, you could lose the opportunity to profit from them if a neighbor drills first. 

If you plan to sell mineral rights, you should speak to a trusted mineral broker like the Mineral Auction to help you understand your options and make informed decisions about how to market and sell your valuable underground resources. 

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Ready to explore your options for your mineral rights? Contact expert brokers like The Mineral Auction today to sell your mineral rights. 

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