No. 98-830
In the Supreme Court of the United States
OCTOBER TERM, 1998
AMOCO PRODUCTION COMPANY, ET AL., PETITIONER
v.
SOUTHERN UTE INDIAN TRIBE, ET AL.
ON WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE TENTH CIRCUIT
BRIEF FOR THE FEDERAL RESPONDENTS
JOHN D. LESHY
Solicitor
Department of the Interior
Washington, D.C. 20240
SETH P. WAXMAN
Solicitor General
Counsel of Record
LOIS J. SCHIFFER
Assistant Attorney General
EDWIN S. KNEEDLER
Deputy Solicitor General
JEFFREY P. MINEAR
Assistant to the Solicitor General
JEFFREY C. DOBBINS
ELIZABETH ANN PETERSON
Attorneys
Department of Justice
Washington, D.C. 20530-0001
(202) 514-2217
QUESTION PRESENTED
Whether Congress's reservation of "coal" in the Coal Lands Act
of 1909, ch. 270, 35 Stat. 844, and the Coal Lands Act of 1910, ch. 318,
36 Stat. 583, includes coal bed methane.
In the Supreme Court of the United States
OCTOBER TERM, 1998
No. 98-830
AMOCO PRODUCTION COMPANY, ET AL., PETITIONER
v.
SOUTHERN UTE INDIAN TRIBE, ET AL.
ON WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE TENTH CIRCUIT
BRIEF FOR THE FEDERAL RESPONDENTS
OPINIONS BELOW
The opinion of the en banc court of appeals (Pet. App. 1a-51a) is reported
at 151 F.3d 1251. The panel decision of the court of appeals (Pet. App.
52a-94a) is reported at 119 F.3d 816. The opinion of the district court
(Pet. App. 95a-132a) is reported at 874 F. Supp. 1142.
JURISDICTION
The court of appeals, sitting en banc, entered its decision on July 20,
1998. On October 15, 1998, the Chief Justice extended the time for filing
a petition for a writ of certiorari to November 18, 1998, and the petition
was filed on that date. The jurisdiction of this Court is invoked under
28 U.S.C. 1254(1).
STATEMENT
At the beginning of the twentieth century, President Theodore Roosevelt
and Congress took action to maintain the Nation's coal resources in public
ownership to meet the Nation's vital energy needs. This case presents the
question whether, when Congress reserved "all coal" in the Coal
Lands Act of 1909, ch. 270, 35 Stat. 844, and "all the coal" in
the Coal Lands Act of 1910, ch. 318, § 3, 36 Stat. 584, Congress retained
all of the hydrocarbon compounds present in coal, including a component
commonly known as coal bed methane (CBM). The United States Court of Appeals
for the Tenth Circuit, sitting en banc, determined that Congress retained
the CBM as part of the reserved coal and that the Southern Ute Indian Tribe,
which now owns some of that reserved coal, therefore also owns the CBM component.
Petitioners Amoco Production Company et al., challenge that ruling. Petitioners
contend that Congress reserved only those components that they describe
as "solid coal." To place this controversy in context, we first
describe the nature of the physical resource at issue and the statutory
bases for the competing ownership claims. We then turn to the origins and
posture of the current controversy.
A. The Physical Resource
Petitioners and the Tribe make competing claims to the ownership of CBM
that rest, in significant part, on their different characterizations of
that energy resource. The Tribe, which indisputably owns the coal underlying
its Reservation, contends that CBM is a constituent of coal. Petitioners,
who claim a right to drill for natural gas within the Reservation, contend
that CBM is simply natural gas that happens to be found in coal deposits.
The United States had originally agreed with petitioners' characterization,
but, as a result of further analysis precipitated by the court of appeals'
decisions, the United States has concluded that petitioners' position is
wrong. To shed light on the competing characterizations, we begin by providing
a brief introduction to the undisputed scientific facts respecting coal
and CBM.
1. Coal is essentially fossilized plant material that has undergone a physical
and chemical transformation, over millions of years, through the process
of accumulation, biological decomposition, and metamorphosis under conditions
of high pressure and temperature. See, e.g., Van Krevelen, Coal 2-3 (1993)
(Van Krevelen); Ward, Coal Geology, in 3 Encyclopedia of Physical Science
& Technology 371-372 (2d ed. 1992). Coal is a heterogeneous substance
that invariably contains carbonaceous material, moisture, and small amounts
of minerals. Id. at 372. Because the conditions for coal formation vary,
the composition and characteristics of individual coal deposits are not
uniform. Ibid. For practical purposes, coal users customarily classify coal,
based on the ascending degree to which "coalification" has taken
place, as lignitic, sub-bituminous, bituminous, and anthracitic. See id.
at 377, Table I (Coal Classification by the American Society for Testing
and Materials (ASTM)). See generally Myers, Coal Handbook (1981) (J.A. 543-552);
Bend, The Origin, Formation, and Petrographic Composition of Coal, 71 J.
of Fuel 851-862 (1991) (Bend) (C.A. App. 664-675); Aff. of Dr. Harry Marsh,
JA 378-379; Aff. of Jeffrey R. Levine, JA 347-348.
Bituminous and anthracitic coals generally have the appearance of a black
rock. Their actual structure, however, is quite complex. See Larson &
Gorbaty, Coal Structure and Reactivity, in 3 Encyclopedia of Physical Science
and Technology 437, 441 (2d ed. 1992) (Larson & Gorbaty). At the macroscopic
level, coal typically exhibits stratified layers that are themselves composed
of microscopic organic composites, called macerals, interspersed with mineral
matter. Id. at 439-440, 443. The composition of the macerals depends in
part on the composition of the fossilized organic material (e.g., lignins,
waxes, or carbonized wood). Id. at 439-440. See generally Bend, C.A. App.
675-680; Marsh Aff., JA 374-376; Aff. of Stephen L. Bend, JA 302 & Table
A.
2. The dispute in this case arises from the unusual physical characteristics
of coal. Coal is extremely porous, containing as much as 20% void volume,
and yet is relatively impermeable to passage of gases and liquids. See Larson
& Gorbaty 442-443. The carbonaceous materials within the macerals of
bituminous and anthracitic coals typically are "penetrated by an extensive
network of very tiny pores and, because of this, have enormous surface areas."
Id. at 442-443. At the same time, the small size of the pores restricts
the passage of molecules through the coalbed. "The smaller pores are
about the same size as small molecules, so coals are molecular sieves, capable
of trapping small molecules in their pores while denying access to larger
molecules." Id. at 443. See also, e.g., Van Krevelen 207-211.1
At this molecular level, coal is not a typical crystalline solid. "Coals
are believed to be three-dimensionally cross-linked macromolecular networks
containing dissolved organic material that can be removed by extraction."
Larson & Gorbaty 444. "The extractable portion of the coal is simply
dissolved in this solid, insoluble framework." Id. at 445. "As
much as 25% of many coals consists of small molecules that will dissolve
in a favorable solvent and can thereby be removed from the insoluble portion."
Id. at 444. See also Van Krevelen 598 ("the principle component of
[bituminous] coals consists of a porous cross-linked macromolecular network
in which a complex mixture of soluble molecules is intimately sorbed");
see generally Levine Aff., JA 342-353; Levine, Coal Composition, as Related
to the Mode of Occurrence of "Coalbed Methane" (1992) (Levine
Rep.) (JA 580-593).
For this reason, scientists describe coal as having a "colloidal"
structure2 consisting of a rigid macromolecular "matrix" component
and a dispersed "molecular" or "mobile" component. See,
e.g., Van Krevelen 193, 598; see also Levine Rep., JA 584-593; Bend Aff.,
JA 305-308; Marsh Aff., JA 381-386. Each of those components plays a role
in determining a particular coal's characteristics, Van Krevelen 598, and
neither phase is entirely static or homogeneous, Levine Rep., JA 588. The
coalification process, which gradually transforms lower rank coals to higher
ranks, continuously alters the composition and characteristics of each component.
See, e.g., Levine Rep., JA 605-608; Levine Aff., JA 347-348. Throughout
that gradual process, coal remains a complex mixture consisting of an extended
macromolecular matrix held together by stronger, covalent bonds, and a mobile
phase, consisting of a mixture of smaller molecules that are held within
that macromolecular framework through physical constrictions, hydrogen bonding,
and Van der Waals forces. See Levine Rep., JA 586-587; Bend Aff., JA 308;
Marsh Aff., JA 381-387 (explaining covalent bonds and van der Waals forces).
3. The smallest of the organic molecules present in the mobile phase is
methane (CH4). When present in coal beds, the methane (together with small
amounts of other coexisting gases) is commonly denominated as coal bed methane
(CBM). See, e.g., Levine Rep., JA 594. Like the other organic materials
present in coal beds, CBM is a product of the coalification process. Id.
at 605-608. At standard temperature and pressure, CBM exists as a gas. Id.
at 595. But when formed in a coal seam, CBM is adsorbed within the pore
structure created by the macromolecular matrix and exhibits a density similar
to that of liquid methane. Marsh Aff., JA 393; see Levine Rep., JA 610.3
More so than larger organic molecules dispersed within the macromolecular
matrix, CBM can migrate over time, particularly if the coal seam is fractured
or if it is subject to changes in temperature and pressure. Those changes
alter the equilibrium within the coal bed, counteract the electrostatic
forces that fix the CBM in the adsorbed state, and convert the CBM to free
gas that can migrate through the pores and out of the coal's macromolecular
matrix. See Levine Rep., 595-596. Energy companies have developed technology
to produce CBM from coal beds through fracturing and creation of pressure
or temperature gradients. Ibid.; Marsh Aff., JA 395; Levine Aff., JA 351-352.
The current controversy centers on whether CBM produced in this manner should
be treated, for purposes of the Coal Lands Act of 1909 and the Coal Lands
Act of 1910, as part of the coal or as a separate mineral estate.
B. The Statutory Basis For The Competing Ownership Claims
The competing claims to ownership of CBM arise from two congressional enactments
in the early twentieth century, the Coal Lands Act of 1909, ch. 270, 35
Stat. 844, and the Coal Lands Act of 1910, ch. 318, 36 Stat. 583. Congress
enacted those statutes to allow homesteaders to obtain patents to public
lands that the United States believed to be valuable for coal, while reserving
the coal itself in federal ownership. The genesis of those statutes is described
in Watt v. Western Nuclear, Inc., 462 U.S. 36, 47-49 (1983), as well as
other sources. See, e.g., Swenson, Legal Aspects of Mineral Resources Exploitation
(Swenson), in Gates, History of Public Land Law Development 699, 724-730
(1978) (Gates).
1. During the latter half of the nineteenth century, Congress made unappropriated
public lands available for settlement through the Homestead Acts, see, e.g.,
Act of May 20, 1862, ch. 75, 12 Stat. 392, and the Desert Land Acts, see,
e.g., Act of Mar. 3, 1877, ch. 107, 19 Stat. 377 (43 U.S.C. 321-323), which
enabled settlers to obtain a land patent by entering and cultivating tracts
of prescribed size for a period of years. See Gates 387-434. Congress exempted
from entry under those Acts, however, public land classified as valuable
for coal. Western Nuclear, 462 U.S. at 47- 48. Coal lands instead could
be purchased under the Coal Lands Act of 1864, ch. 205, 13 Stat. 343, and
the Coal Lands Act of 1873, ch. 279, 17 Stat. 607 (see 30 U.S.C. 71 et seq.).
See generally Swenson 724-725.
The process of segregating agricultural lands from coal lands proved unsuccessful
because coal lands were frequently misclassified as a result of mistake
or outright fraud. Western Nuclear, 462 U.S. at 48 note 9. In 1906, President
Theodore Roosevelt withdrew from all forms of entry approximately 64 million
acres of lands thought to contain coal, "citing the prevalence of land
fraud and the need to dispose of coal 'under conditions which would inure
to the benefit of the public as a whole.'" Id. at 48-49 (quoting 41
Cong. Rec. 2615 (1907)). President Roosevelt later "urged Congress
that 'rights to the surface of the public land . . . be separated from rights
to forests upon it and to minerals beneath it, and these should be subject
to separate disposal.'" Id. at 49. By enacting the Coal Lands Act of
1909 and the Coal Lands Act of 1910, Congress took the first in a series
of steps to effectuate that separation, which has resulted in preserving
the public's ownership of a significant share of the Nation's energy resources.
Id. at 49 & note 10; see Swenson 725-729.
The 1909 Act answered the concerns of individuals who had in good faith
made agricultural entries onto tracts subsequently identified as coal lands.
The Act permitted the entryman to receive a patent to his tract, but required
the patent to contain a reservation to the United States "of all coal
in said lands, and the right to prospect for, mine, and remove the same."
35 Stat. 844 (currently codified at 30 U.S.C. 81). The 1910 Act opened the
remaining coal lands for entry under the homestead laws, allowing "actual
settlers," upon proof of compliance with the homestead laws, to receive
patents to the surface of those lands. § 1, 36 Stat. 583. As in the
case of the 1909 Act, the patents contained a reservation to the United
States "of all the coal in the lands so patented, together with the
right to prospect for, mine, and remove the same." § 3, 36 Stat.
584 (currently codified at 30 U.S.C. 83-85).
The Coal Lands Acts reserved to the United States all coal in the lands,
including "coal that is of but little present commercial value,"
and confined the entries allowed on coal lands to "settlement and development
entries in order that none of the so-called speculative entries may be made
on the surface of coal land." 45 Cong. Rec. 6042 (1910) (Rep. Mondell).
The purpose of the statutes was "the separation of the surface title,
which is fitted for agriculture, from the coal measures lying beneath the
surface." 45 Cong. Rec. 7453 (1910) (Sen. Dixon).4
2. The lands opened for settlement under the Coal Lands Acts of 1909 and
1910 included lands within the Southern Ute Indian Reservation in Colorado.
In 1880, the members of the Southern Ute Indian Tribe agreed to sell a large
portion of their land within the Reservation to the United States, excepting
certain allotted lands "provided for their settlement." Act of
June 15, 1880, ch. 223, 21 Stat. 200. Congress directed that the ceded,
unallotted reservation lands be treated as public lands, and it opened those
lands to entry for non-Indian settlement under the homestead laws. See §
3, 21 Stat. 203. See generally United States v. Southern Ute Tribe, 402
U.S. 159, 162-164 (1971). The ceded territory included lands that President
Roosevelt later withdrew from entry and that Congress made available for
surface patenting under the 1909 and 1910 Acts.
In 1938, under the authority of the Indian Reorganization Act of 1934, ch.
576, 48 Stat. 984 (25 U.S.C. 461-479), the United States restored to the
Tribe, in trust, title to the ceded reservation lands that had not been
disposed of, including the reserved coal. Pet. App. 109a. As a result of
that restoration, the Tribe now has equitable title to tribal lands within
its Reservation and the coal estate beneath lands within the Reservation
that were settled by non-Indians under the 1909 and 1910 Acts. Petitioners,
by contrast, own the non-coal portions of the lands conveyed under the 1909
and 1910 Acts or, alternatively, hold mineral leases from those owners,
limited to non-coal resources of those lands. Id. at 109a-110a.
C. The Current Controversy
The energy shortages of the 1970s prompted investigation into alternative
fuel sources, including the possibility of extracting CBM from coal. Questions
arose, however, over who owned the CBM if the owner of the fee had severed,
by sale or reservation, a coal estate or a gas estate from the remainder
of the fee. That issue could arise under federal law, by virtue of the 1909
and 1910 Acts as well as under the Agricultural Entry Act of 1914, 30 U.S.C.
121-123, which reserved "gas" to the United States. Related questions
about the status of CBM could also arise under the Mineral Leasing Act of
1920, 30 U.S.C. 181 et seq., which provides for leasing of both coal and
gas. CBM ownership issues could also arise under state law by virtue of
an individual owner's decision to lease or reserve coal or gas. See, e.g.,
Farnell, Methane Gas Ownership: A Proposed Solution for Alabama, 33 Ala.
L. Rev. 521 (1982).5
1. In 1981, the Solicitor of the Interior issued an opinion entitled Ownership
of and Right to Extract Coalbed Gas in Federal Coal Deposits, 88 Interior
Dec. 538 (Pet. App. 140a-159a). The Solicitor determined that he should
address the issue because "the unresolved legal status of coalbed gas
on federal lands and in federal coal has hindered any decision on how, and
under what right of extraction, it can be developed." Pet. App. 142a.
The Solicitor concluded that: (1) the 1909 and 1910 Acts did not reserve
the coal bed gas found in the reserved coal; (2) the reservation of gas
under the Agricultural Entry Act included coal bed gas; and (3) coal bed
gas is disposable under the oil and gas leasing provisions of the Mineral
Leasing Act. See id. at 143a. The Solicitor cautioned, however, that "nothing
in this opinion warrants title to any oil and gas deposit." Id. at
159a.
2. Ten years later, on December 31, 1991, the Tribe filed this action against
petitioners and others who asserted a right to recover CBM from the Tribe's
coal deposits in lands patented pursuant to the 1909 and 1910 Coal Lands
Acts. The Tribe sought a declaration that it is the sole owner of the CBM
that resides within the coal seam, and it sought damages for the alleged
trespass and conversion of the Tribe's property. The Tribe also sued the
United States, seeking a declaration that the United States owed a duty
to the Tribe to protect and manage CBM development for the Tribe. See JA
171-179.6
Petitioners responded that the reservation of "all coal" in the
1909 and 1910 Acts did not include CBM, and they also raised other affirmative
defenses. The United States concurred in petitioners' interpretation of
the two Acts, relying on the 1981 Solicitor's opinion, and additionally
asserted that the Tribe's breach of trust claim against the United States
was barred by the applicable six-year statute of limitations, 28 U.S.C.
2401(a), in light of Tribe's past history of CBM development and its knowledge
of the Solicitor's 1981 opinion.
3. The district court ruled on cross-motions for summary judgment that "Congress
did not reserve CBM gas in the United States in the Coal Lands Acts of 1909
and 1910 and, consequently, [the Tribe's] claim of equitable ownership of
CBM gas in the lands at issue fails." Pet. App. 98a. The court concluded,
on the basis of dictionary definitions that describe coal as a "solid"
or "rock," that the 1909 and 1910 Acts do not include CBM. Id.
at 110a-116a. The court also concluded that the legislative history of those
Acts, which made no reference to CBM, supported that interpretation. Id.
at 116a-127a.7
4. The court of appeals reversed the district court's judgment and remanded
for further proceedings. Pet. App. 52a-94a. The court of appeals reasoned
that the question of CBM ownership "cannot be disposed of by the simple
tautology that gas is gas," id. at 63a-64a, because Congress could
have reasonably viewed adsorbed CBM as "an integral part of the coal,"
id. at 64a. The court concluded that the 1909 and 1910 Acts manifested no
specific intent to convey CBM, id. at 66a, and that those Acts manifested
a general intent to reserve the federal government's entire economic interest
in the coal deposits, id. at 71a-72a. Those considerations, "coupled
with the principle of statutory construction that resolves ambiguity in
favor of the sovereign," see, e.g., Western Nuclear, 462 U.S. at 59,
persuaded the court that "CBM was reserved to the United States."
Pet. App. 72a.
5. Petitioners sought rehearing en banc, and the en banc court granted rehearing
limited to the question "whether 'coal' as used in the Coal Lands Act
of 1909 and 1910 unambiguously excludes or includes CBM." Pet. App.
8a. By a vote of six to three, the en banc court adhered to, and supplemented,
the reasoning of the unanimous panel. Id. at 1a-51a; see id. at 8a-9a. The
en banc court held that the term "'coal' as used in the Coal Lands
Acts of 1909 and 1910 neither unambiguously includes or excludes coal bed
methane. Given the established principle that all doubts respecting land
grants and mineral reservations are construed in favor of the government,
see Watt v. Western Nuclear, Inc., 462 U.S. at 59," the en banc court
concluded that "coal reserved to the United States in the 1909 and
1910 Acts includes the adsorbed CBM." Pet. App. at 32a-33a. In reaching
the conclusion that the 1909 and 1910 Acts are ambiguous, the en banc court
surveyed the language of those Acts, id. at 11a-14a, contextual indicia
of Congress's specific intent, id. at 14a-24a, and indicia of Congress's
general intent drawn from the legislative history and related statutes,
id. at 24a-32a. Three judges dissented, reasoning that "coal was not
understood, either in 1909 or today, to include a gas." Id. at 34a;
see id. at 34a-51a.8
SUMMARY OF ARGUMENT
The Tenth Circuit, sitting en banc, correctly concluded that Congress's
reservation of "all coal" in the Coal Lands Acts of 1909 and "all
the coal" in the Coal Lands Act of 1910 includes coal bed methane (CBM).
In accordance with this Court's guidance, the court carefully evaluated
the language of those statutes, the specific context in which the language
was used, and the broader context of the Acts as a whole. See Robinson v.
Shell Oil Co., 519 U.S. 337, 341 (1997). The court of appeals determined
that Congress did not express any intent, whether by clear language or by
necessary or fair implication, to convey away the public's ownership of
CBM, which is one of the natural constituents of coal. Petitioners' contrary
contention, which ultimately rests on the mantra that "coal" means
"solid coal" (Pet. Br. 20), does not withstand careful scrutiny.
A. Congress's use of the term "coal," taken in its ordinary sense
at the time the Coal Lands Acts were enacted, referred to the carbonaceous
substance that nature deposited in the form of coal seams and that miners
removed as a source of fuel. That substance always contains, as an essential
constituent, CBM. The scientific literature confirms what Congress and the
general public knew as a matter of practical experience and common sense:
coal has aggregate characteristics of a solid, but it consists of a mixture
of solid, liquid, and gaseous constituents, including CBM. It would not
only be completely unnatural to construe the term "coal" as limited
to "solid coal," but it also would raise a host of practical problems
and definitional inconsistencies. For example, coal contains both moisture
and liquid coal extracts, which are undeniably constituents of coal. Yet,
under petitioners' novel definition, Congress did not include those constituents
within the coal reservation because they are not "solid coal."
The historical context also supports the court of appeals' judgment. Congress
had no reason to separate from the coal, as a matter of law, a constituent
that could not be readily separated as a matter of practical fact. Indeed,
an important coal technology of that era-the gas producer-actually utilized
the CBM. The legislative history contains no discussion of CBM, and the
most reasonable inference from the floor colloquies is that Congress viewed
CBM as a component of coal and not as "natural gas." The court
of appeals' judgment also finds support in the way that contemporary state
law treated both fixed minerals and gas. See, e.g., Kansas Natural Gas Co.
v. Board of County Comm'rs, 89 P. 750, 752 (Kan. 1907) ("until gas
is actually produced and severed so that it becomes personalty the legal
title to, and possession of, the entire volume remain in the owner of the
strata in which it is confined"). It therefore comes as no surprise
that the majority of state courts that have confronted the practical realities
of CBM production have rejected petitioners' position that a coal estate
does not include CBM.
B. The en banc court properly rejected petitioners' assertion that their
proposed construction of the term "coal" is so plainly correct
as to be "clear as day." Pet. Br. 43. Having carefully applied
this Court's guidance on statutory construction, and finding no basis for
inferring that Congress intended to convey a constituent of coal to homesteaders,
the court of appeals properly invoked the "established rule" that
doubts respecting Congress's intent should be resolved in favor of retaining
public ownership. See, e.g., Watt v. Western Nuclear, Inc., 462 U.S. 36,
59 (1983). Petitioners do not contest the validity of that principle; they
argue only that it should not be applied here. But that contention is not
substantial in light of the absence of any clear expression of congressional
intent to convey the CBM component of coal deposits. Indeed, application
of the canon of construction here furthers its fundamental purpose, by reserving
to Congress the power and responsibility to weigh the competing policy considerations
bearing on whether to dispose of that property of the United States.
C. At the commencement of this litigation, the United States had supported
petitioners' position, based on the reasoning contained in the 1981 opinion
of the Solicitor of the Interior. This litigation-the first instance in
which that opinion has been subject to the adversarial process-has revealed
that the Solicitor's 1981 decision is mistaken. The Solicitor has therefore
withdrawn that opinion. Contrary to petitioners' assertions, there is nothing
improper in the Solicitor's reexamination of an opinion in light of the
insights gained in the course of attempting to defend it in litigation.
To the contrary, it is entirely appropriate for the United States to decline
to defend a legal position before this Court when an en banc court of appeals
has rejected it and the government has concluded that the position is wrong.
ARGUMENT
THE COURT OF APPEALS CORRECTLY RULED THAT THE COAL LANDS ACTS OF 1909 AND
1910 DO NOT GRANT THE PATENT HOLDER A RIGHT TO EXTRACT COAL BED METHANE
FROM THE RESERVED COAL
Introduction
Petitioners and the Southern Ute Indian Tribe each claim a right to the
coal bed methane found in the coal deposits that Congress reserved through
the Coal Lands Acts of 1909 and 1910 and later conveyed to the Tribe. The
issue, simply put, is whether CBM is a part of the coal reservation. Petitioners
argue that the Congress did not intend to reserve CBM, reasoning that CBM
is merely unreserved natural gas that happens to be found in coal seams
and that passed into the hands of homesteaders who acquired the coal-bearing
lands subject to the federal government's reservation of the coal deposits.
The Tribe argues that Congress did intend to reserve CBM, reasoning that
CBM is a constituent of the reserved coal that the Tribe acquired from the
federal government.
The en banc court of appeals properly framed the issue as one of construing
the Coal Lands Acts. Pet. App. 10a. Finding that "[t]he Acts neither
define coal nor mention CBM," the court of appeals evaluated the issue
of CBM ownership based on "traditional tools of statutory construction."
Id. at 14a. The court first examined the relevant statutory language in
light of its specific context, taking into account the historical definitions
of "coal" (id. at 14a-17a), the then-current knowledge of coal's
characteristics (id. at 17a-21a), and the state courts' treatment of CBM
ownership (id. at 21a-24a). The court of appeals then evaluated the statutory
language based on the general context of the Acts as a whole (id. at 24a-27a),
taking into account the statutory objectives, the legislative history, and
related statutes that could shed light on Congress's intent in enacting
the Coal Lands Acts (id. at 27a-31a). After considering all of those sources,
the court of appeals concluded that the Coal Lands Acts are ambiguous with
respect to Congress's intent to grant or convey CBM, and it applied the
"'established rule that land grants are construed favorably to the
Government, that nothing passes except what is conveyed in clear language,
and that if there are doubts they are resolved for the Government, not against
it.'" Watt v. Western Nuclear, Inc., 462 U.S. 36, 59 (1983) (quoting
United States v. Union Pac. R.R., 353 U.S. 112, 116 (1957)). See Pet. App.
10a-11a, 24a, 32a-33a.
The court of appeals' decision is thorough, well reasoned, and faithful
to this Court's guidance respecting statutory interpretation. Contrary to
petitioners' hyperbole, the six-member majority has not "summarily
dispensed with an analysis of the statutory language" (Pet. Br. 17),
"mis[read] contemporary texts" (id. at 21), disregarded "the
language and traditional tools of statutory construction" (id. at 42),
or "refus[ed] to give the term 'coal' its plain meaning" (ibid.).
To the contrary, the court's analysis, first in the unanimous panel opinion
and later in the en banc decision, prompted the government to reexamine
the merits of the position that it had put forward below. The court raised
formidable questions about the correctness of the Solicitor's 1981 opinion.
After careful consideration of those questions, the government determined
that the 1981 opinion was incorrect and should not be defended before this
Court.
Petitioners raise a number of new arguments in support of their view that
Congress's coal reservation unambiguously excludes CBM, but those arguments
are unpersuasive in salvaging what, upon close inspection, has proven to
be a mistaken view of the law. We will begin where the court of appeals'
decision left off and provide, point-by-point, the counter-arguments that
compel us to reject petitioners' contention that the term "coal"
unambiguously excludes CBM. We will then explain why the canon of construction
that ambiguous federal grants should be construed in favor of the government
not only applies, but has special force in this case. Finally, we will respond
to petitioners' charge that the Solicitor has acted improperly in withdrawing
the 1981 opinion.
A. The 1909 And 1910 Acts Do Not Unambiguously Convey Away Public Ownership
Of CBM
"The plainness or ambiguity of statutory language is determined by
reference to the language itself, the specific context in which that language
is used, and the broader context of the statute as a whole." Robinson
v. Shell Oil Co., 519 U.S. 337, 341 (1997). No one disputes that the starting
point is the language, Pet. App. 11a, that legislative intent normally "is
expressed by the ordinary meaning of the words used," United States
v. Locke, 471 U.S. 84, 95 (1985), or that the statutory language frequently
reveals that Congress has dealt with "a practical subject in a practical
way," Burke v. Southern Pac. R.R., 234 U.S. 669, 679 (1914). See Pet.
Br. 21-22. Each of those factors weighs in favor of the court of appeals'
judgment and against petitioners' arguments. There is also no dispute that
it is appropriate to consider other portions of the Coal Lands Acts (id.
at 25-27), and the "historical context" of the Acts (id. at 27-41).
As the court of appeals concluded, those considerations also weigh against
petitioners' construction. See Pet. App. 14a-33a.
1. The Term "Coal" Has Never Been Understood To Refer Only To
What Petitioners Call "Solid Coal." When Congress reserved "all
coal" in the 1909 and 1910 Acts, neither Members of Congress nor the
public needed to consult a dictionary to comprehend the basic thrust of
the legislation. The Coal Lands Acts reserved in public ownership the familiar
carbonaceous substance that miners removed from the ground and the public
used for fuel and other purposes. See United States Geological Survey, Dep't
of the Interior, Contributions to Economic Geology 1906 (Pt. 2) (1907) (JA
403-405) (describing the importance of coal to the American economy). Congress
and the public knew then, as now, that the substance called coal is not
a homogeneous compound, but rather is a complex mixture of organic components.
See, e.g., VI Encyclopaedia Britannica 575 (11th ed. 1910). It was also
common knowledge that coal, both when in the ground and when removed, contains
gaseous constituents-including the material, now called CBM, that is at
issue in this case. See, e.g., Bureau of Mines, Dep't of the Interior, The
Escape of Gas from Coal (1911) (JA 510, 521-522). Indeed, it was impossible
for miners to remove coal without also removing the inextricably adsorbed
CBM, portions of which lingered for months in the mined coal as the gaseous
constituents-primarily methane-came into equilibrium with the ambient air.
See, e.g., JA 521-522.
It follows that, if the benchmark for determining the scope of Congress's
reservation is the ordinary meaning of the term "all coal," then
the 1909 and 1910 Acts reserved the entire coal product that miners remove
from the coal seam, including the adsorbed hydrocarbon gases that are invariably
present both as part of the coal deposit in the ground and as part of the
mined product. As the Kansas Supreme Court rightly observed in 1907, the
term "'minerals therein' can mean none other than minerals imbedded
in the earth as nature deposited them." Kansas Natural Gas Co. v. Board
of County Comm'rs, 89 P. 750, 751 (Kan. 1907). The same holds true for coal.
CBM is "one of the several products of coalification," and so
long as it resides in the coal seam, it "cannot logically be considered
as being in any way different from other products of coalification."
Marsh Aff., JA 398.
The ordinary meaning of "coal" is the practical one as well. If
Congress meant to deal with a "practical subject in a practical way,"
Burke, 234 U.S. at 679, it would not have limited its reservation to what
petitioners call the "solid coal" (e.g., Pet. Br. 20) (emphasis
in original) and conveyed to others the inextricably adsorbed component
that the miner necessarily removed as part of the mined product. As the
court of appeals pointedly stated, "it seems to us quite unlikely that
Congress, if it had considered the matter, would have reasoned, 'We want
the Government to hold on to the solid bituminous core of these coal deposits,
but we make no claim to the thin layer of molecules of CBM which coats the
surfaces.'" Pet. App. 19a-20a.
Petitioners urge the opposite conclusion by recourse to current and historic
dictionaries and texts that describe "coal" as a "rock"
or "solid." Pet. Br. 7-8, 22-25; see, e.g., Van Krevelen, supra;
II Century Dictionary & Cyclopedia 1067 (1906-1909). Petitioners reason
that, if coal is a rock or solid, then its reservation cannot include adsorbed
CBM, which- when separated from the remainder of the coal-exists as a gas.
See Pet. Br. 22-25. As this Court has cautioned, however, "ordinary
definitions of the dictionary" may "throw but little light upon"
congressional intent in reserving naturally occurring substances. Western
Nuclear, 462 U.S. at 42-43. Dictionaries can be useful aids in statutory
interpretation, but they are no substitute for close analysis of what words
mean as used in a particular statutory context: "it is a 'fundamental
principle of statutory construction (and, indeed, of language itself) that
the meaning of a word cannot be determined in isolation, but must be drawn
from the context in which it is used.'" Reno v. Koray, 515 U.S. 50,
56 (1995); Deal v. United States, 508 U.S. 129, 132 (1993). As we explain
below, petitioners have selectively read dictionary definitions that are
themselves ambiguous on the question presented here. And even if those dictionary
definitions were more helpful, petitioners' proposed construction would
present a confounding variety of definitional, interpretive, and practical
problems.
a. Petitioners' argument is problematic at the outset because current and
historical dictionaries that describe coal do not uniformly describe it
as a "rock" or "solid." As the court of appeals pointed
out, the dictionaries and texts actually describe coal in diverse ways that,
taken as a whole, simply highlight that coal is a complex mixture of hydrocarbon
compounds. See Pet. App. 16a-17a (citing, for example, VI The American Cyclopaedia:
A Popular Dictionary of General Knowledge 726 (Ripley & Dana eds. 1873);
VI Encyclopaedia Britannica 575 (11th ed. 1910); New Standard Dictionary
of the English Language 508 (1913)). See also Levine Aff., JA 344-345; Marsh
Aff., JA 371-381. The variety of prevalent descriptions demonstrates that
coal cannot be accurately described through petitioners' selective reliance
on one or two words. See National R.R. Passenger Corp. v. Boston & Maine
Corp., 503 U.S. 407, 418-419 (1992) ("The existence of alternative
dictionary definitions * * * , each making some sense under the statute,
itself indicates that the statute is open to interpretation.").
Even if the dictionaries and texts were more uniform in using the terms
"solid" or "rock" to describe coal, it would be unsound
to isolate and rely selectively on those terms to answer the question presented
here. Petitioners' dictionaries and texts use the terms "rock"
or "solid" to describe either the appearance or the specific petrographic
characteristic of coal-they do not use those terms to define the composition
of coal or the relationship between coal and CBM.9 Indeed, the sources that
petitioners themselves cite for the proposition that coal means "solid
coal" quite specifically contradict petitioners' facile assertion that,
with respect to the issue presented here, "the meaning of 'coal' is
clear as day." Pet. Br. 43.
For example, Van Krevelen's comprehensive text, Coal, observes at the very
outset that there is a "diversity of scientific approaches" for
characterizing coal depending on the purpose of the scientific inquiry:
Coal is a rock, a sediment, a conglomerate, a biological fossil, a complex
colloidal system, an enigma in solid- state physics and an intriguing object
for chemical and physical analyses.
Van Krevelen 4. Van Krevelen devotes the first 10 chapters of his book to
explaining each of those different perspectives. Id. at 5-332. He ultimately
states that current scientific knowledge indicates that "the principal
component of [bituminous] coals consists of a porous cross-linked macromolecular
network in which a complex mixture of soluble molecules is intimately sorbed."
Id. at 598 (emphasis added). Accord Larson & Gorbaty 444-445; Bend Aff.,
JA 305-306; Levine Aff., JA 346-347; Marsh Aff., JA 385-387; see also C.A.
App. 803-811 (Marsh's pictorial illustrations of coal's molecular structure).
That description stands in stark contrast to petitioners' simplistic and
scientifically unsound assertion that coal is a "solid" or "rock"
and its reservation therefore cannot include CBM.10
Petitioners' contention is particularly dubious because, at the time that
Congress acted, government geologists knew and had informed Congress that
coal contained hydrocarbon gases, including gases that may be present in
an "occluded" state. The United States Geological Survey (USGS)
reported to Congress, in H.R. Doc. No. 1538, 60th Cong., 2d Sess. (1909),
as follows:
The gas which escapes from coal may exist within the mass of the coal in
three possible conditions. It may be mechanically held or imprisoned in
minute pores, cavities, or cracks throughout the coal; it may be occluded
or dissolved within the substance of the coal; or it may be the result of
slowly operating chemical reactions, such as the those which have produced
the coal from the original vegetable matter.
USGS, Dep't of the Interior, Notes on Explosive Mine Gases and Dusts, with
Special Reference to Explosions in the Monongah, Darr, and Naomi Coal Mines
(1909) (JA 433); accord Bureau of Mines, Dep't of the Interior, The Escape
of Gas From Coal (1911) (JA 511-513). See also Chamberlin, The Gases in
Rocks 35, 57-61 (1908) (describing "occluded gases"). Hence, the
government's geologic experts of that era had directly related to Congress
that coal was not a homogeneous solid, but in fact contained gaseous constituents,
and they presciently recognized that the gas might "be occluded or
dissolved within the substance of the coal." Indeed, the USGS report
quite clearly treated even mechanically held gas as a constituent of the
coal. The report noted that heating coal "caused the expulsion of such
uncombined gas as was ready to escape at ordinary temperatures, and in addition
developed some new gas from the nongaseous constituents of the coal."
JA 468 (emphasis added).
Those scientists understood that there is nothing unusual in the fact that
a "solid" substance can have gaseous constituents. Indeed, it
is commonplace to use terms such as "solid," "liquid,"
or "gas" to describe the aggregate or predominant qualities of
a substance that consists of a mixture of solid, liquid, and gaseous ingredients.11
The same holds true for coal. Congress reserved "coal" by name,
and it is reasonable to interpret "coal" to include all of coal's
naturally co-existing constituents, including components that would be liquids
or gases if physically separated from the coal.
b. Petitioners' reasoning is also unsound in light of its practical consequences.
Petitioners' assertion that Congress reserved only "solid coal"
would necessarily lead to the untenable conclusion that Congress not only
failed to reserve CBM, but that it also failed to reserve other sorbed coal
components, including water and "volatile" matter, that are commonly
present in, and treated as components of, coal.12 Indeed, the ASTM standards
for classifying coal (see page 3, supra), distinguish varieties of coal
on the basis of a number of factors, including the presence of "moisture"
and "volatile" matter. It would be quite strange to conclude that
Congress's reservation of coal did not extend to coal components that determine
the identifying characteristics of different coals. See Marsh Aff., JA 372,
377, 379-381, 387-388, 393, 398.13
Petitioners' reasoning that Congress reserved only "solid coal"
would also lead to the even more extraordinary result that Congress did
not reserve "coal extracts," which include other small hydrocarbon
molecules, in addition to CBM, that are present within the macromolecular
structure of coal and can be extracted through the use of appropriate solvents.
See Van Krevelen 549-600; Larson & Gorbaty 444-445. Coal extracts comprise
"[a]s much as 25% of many coals." Id. at 444. They "are natural
ingredients of the coal" (Van Krevelen 600) and include molecules that
would be liquids outside of that macromolecular coal structure. See id.
at 596-597; see also Larson & Gorbaty 444-445; Levine Rep., JA 590-591;
Tissot & Welte, Petroleum Formation and Occurrence 248-249 (2d ed. 1984)
(Tissot & Welte). Under petitioners' reasoning, Congress failed to reserve
those potentially removable "natural ingredients"-and instead
gave them to surface homesteaders-because coal extracts are not part of
the "solid coal."
c. Petitioners' attempt to define "coal" as a subset of itself-namely,
"solid coal"-illustrates the fundamental problem with petitioners'
argument. Coal is a complex mixture of solid, liquid, and gaseous hydrocarbons
that collectively constitute "coal." It does not exist in the
forms of "solid," "liquid" and "gaseous" coal.
Coal has the aggregate characteristics of a solid, but it also consists
of moisture and liquid and gaseous hydrocarbons. It is the infinitely varied
combination of its solid, liquid, and gaseous constituents that defines
and determines the characteristics of individual coals. See Levine Aff.,
JA 345-347; Marsh Aff., JA 381-388; Bend Aff., JA 304-305. Hence, it should
come as no surprise that, when Congress has defined the term "coal"
in other statutory contexts, it has consistently done so by reference to
the varieties of coal that embody those naturally occurring mixtures of
different constituents.14
At bottom, what petitioners really mean by "solid coal" is "degasified
coal"-the non-naturally occurring substance that their exploitation
of CBM would leave behind. Indeed, petitioners apparently coined the term
"solid coal" solely for the purpose of this case. Tomkeieff's
lexicon of coal nomenclature, Coals & Bitumens (1954) (Tomkeieff), which
petitioners cite (see Br. 9), contains hundreds of descriptive coal terms-including,
for example, "stink coal," "tar coal," "mushy coal,"
"leaf coal," "curly coal," and "smush"-but
it nowhere mentions "solid coal." At the same time, that lexicon
lists no less than 23 varieties of "high volatiles coal" (Tomkeieff
116), including "gas coal," "bottle coal," and "fat
coal," and also defines additional names for such coal, including "parrot
coal" ("from the chattering noise it makes on burning" (id.
at 73)) and "singing coal" (which describes "coal from which
gas escapes with a hissing sound, particularly if the surface of it is wet"
(id. at 85)).
Tomkeieff's lexicon captures the practical knowledge and understanding of
miners and the mining industry. Since the advent of large-scale mining more
than a century ago, miners have known that "coal" is a highly
variable mixture of substances, that its ingredients can include gaseous
components, and that the presence of those gaseous components can be so
distinctive as to distinguish one variety of coal from another. The plain
and descriptive language of those who work the mines provides additional
evidence that petitioners are incorrect in asserting that the 1909 and 1910
Acts unambiguously reserved only what they call the "solid rock"
and not the gaseous constituents of the coal.15
2. The "Historical Context" Of The 1909 and 1910 Acts Does Not
Support Petitioners' Construction. Petitioners are wrong in asserting that
"the history and context of the 1909 and 1910 Acts, and their place
in the progression of public lands statutes, verify that Congress only intended
to reserve coal (and not gas) to the United States." Pet. Br. 27. Petitioners
begin from the mistaken premise, discussed above, that "coal"
cannot have gaseous constituents that are reserved as part of the coal.
But even apart from that erroneous premise, petitioners' historical presentation
provides an incorrect picture of congressional intent. The court of appeals'
analysis presents the more accurate view of the historical record. Pet.
App. 24a-32a. We supplement the court's treatment with several observations
in response to petitioners' specific assertions.
a. Petitioners assert that Congress's reservation of "coal" reflects
congressional efforts to redress a crisis in the supply of "solid coal"
with minimal encroachment on settler property rights. Pet. Br. 27-28. The
legislative record, however, does not bear out petitioners' focus on what
it calls "solid coal." The legislative record of the 1909 and
1910 Acts, including their text and their enactment history, indicates that
Congress reserved first "all coal" (35 Stat. 844) and then synonymously
"all the coal" (§ 3, 36 Stat. 584) in lands classified as
valuable for coal-it says nothing about reserving only the "solid"
constituents. Congress did not use petitioners' newly minted term "solid
coal," nor did it express a special interest in reserving only "degasified
coal." Rather, Congress reserved the totality of coal that nature had
deposited in the coal-bearing lands, including coal deposits that were not
then valuable, but could be valuable "in the future." See Pet.
App. 29a-30a. As the court of appeals observed, Congress had no reason to
reserve the entirety of all the coal deposits and at the same time silently
exclude potentially valuable gaseous constituents that formed with, and
could not be readily separated from, what petitioners call the "solid"
coal. Id. at 30a.16
Petitioners' argument stands on a particularly weak footing because the
historical record indicates that Congress actually had strong practical
reasons to reserve the gaseous components of the coal as a potential energy
source. At the turn of the century, the United States relied on three primary
sources of energy: coal, oil and wood.17 Natural gas was not yet an important
source of energy because there was no pipeline system in existence to transport
that commodity to consumers. Nevertheless, coal could be transported, and
beginning in the 1800s, it was shipped to cities to make "water gas"
and "producer gas" as a source of energy. See Bureau of Mines,
Dep't of the Interior, The Status of the Gas Producer and the Internal-Combustion
Engine in the Utilization of Fuels (1912) (JA 524-526); Perry, The Gasification
of Coal, 230 Sci. Am., No. 3 (Mar. 1974) (JA 530-534). "Nearly every
major city in the eastern U.S. once had its gashouse, where gas was manufactured
(usually from coal) for lighting and cooking." JA 530.
The formerly common practice of using coal to make gas is significant, because
it demonstrates that Congress had a concrete interest in reserving coal's
gaseous components, which were liberated through the coal gasification process
and used as a component of "producer gas." The first step of the
coal gasification process was to heat or "distill" the coal, which
"releases a certain amount of gas that has a fairly high B.t.u. content
because methane (CH4) and other higher hydrocarbons contained in the coal
are among the first components to emerge as the coal decomposes." JA
532.18 The yield of liberated methane was relatively small, but the process
nevertheless put coal's gaseous components to productive use. In light of
that use, it is improbable that Congress, which reserved even coals of no
present value, would have intended to exclude coal's gaseous components
from its reservation of coal. As the Bureau of Mines pointed out, many low-grade
western coals "cannot be used in boiler furnaces and will not bear
long transportation, but the gas producer makes them of potential value."
JA 526.
Petitioners also argue that the statements of Representative Mondell, one
of the sponsors of the Coal Lands Acts, who opposed extending the reservation
to other minerals, indicate that Congress did not intend to reserve CBM.
See Pet. Br. 29-31. Reliance on the statements of a single legislator is,
of course, a hazardous method of determining congressional intent.19 But,
in any event, Representative Mondell's views do not support, and actually
weigh against, petitioners' interpretation. Mondell did not express any
explicit view on whether the term "coal" includes CBM. Petitioners
instead look for support from a floor colloquy in which Mondell expressed
his opposition to a suggestion that Congress reserve "other fuels,
such as gas and oil." Id. at 30 (quoting 45 Cong. Rec. 6044 (1910)).
Mondell's rationale actually undermines petitioners' argument.
First, Representative Mondell stated that "the answer that really controls
here" is that "coal crops out and comes to the surface, and its
presence is therefore apparent," while oil and gas are "found
here and there." 45 Cong. Rec. 6044 (1910). CBM presents no such difficulties
because it, by definition, exists only in the readily recognized coal seams.
Second, Mondell added that "[o]il and gas present much greater difficulties,
when we propose to separate the surface from the mineral, than coal. I question
whether we should provide for surface entries of such lands." Ibid.
(emphasis added). In other words, he did not view the "coal lands"
at issue as containing "oil and gas." Mondell undoubtedly knew
what was then common knowledge and what the USGS had made clear to Congress-that
coal contains what we now call CBM. See pages 24-25, supra. Nevertheless,
he plainly did not equate CBM with the natural gas that was the subject
of the colloquy. Rather, like the USGS, he apparently viewed CBM as a constituent
of the coal.
b. Petitioners next argue that public lands statutes enacted after the Coal
Lands Acts demonstrate that Congress did not intend to reserve CBM. Pet.
Br. 31-36. Petitioners contend that, because Congress explicitly reserved
"gas" in subsequent enactments, including the Act of August 24,
1912, ch. 367, 37 Stat. 496; the Agricultural Entry Act of 1914, ch. 142,
38 Stat. 509; and the Stock-Raising Homestead Act of 1916, ch. 9, 39 Stat.
862, Congress must not have intended to reserve CBM in the 1909 and 1910
Acts. That reasoning, like petitioners' mistaken reliance on Representative
Mondell's statements, overlooks the obvious answer to this supposed anomaly-Congress
viewed coal (including the CBM constituent) as one mineral estate and "oil
and gas" (including gas in non-coal formations) as another.
This distinction is consistent with the way the federal and state courts
at the turn of the century resolved disputes respecting ownership of both
seemingly fixed minerals, such as coal, and seemingly fugacious minerals,
such as oil and natural gas. The courts generally treated the grant or reservation
of a fixed mineral as conveying ownership of the mineral in place, so that
the owner had a property interest in the underground stratum in which the
mineral resides.20 In the case of oil and gas, the courts were deeply divided
on the theories of ownership.21 They nevertheless generally agreed that
the owner of the oil and gas estate could "capture" whatever material
he could draw from a lawfully drilled well.22 Where the oil and gas estates
existed as separate strata, the courts recognized that the owner of a particular
oil and gas stratum could not drill into and invade a mineral stratum owned
by another.23
Those principles suggest how Congress likely viewed the matter in 1909,
and how-until Congress specifies otherwise -this Court should view the matter
now under the 1909 and 1910 Acts. CBM that resides within a coal stratum
(which is the status of the CBM at issue here, Pet. App. 18a note 8) is
part of the coal owner's coal estate, and any attempt by the owner of the
relevant non-coal estate to drill into that stratum and extract the CBM
therein is a trespass on the coal owner's property rights.24 But CBM that
has migrated from the coal stratum into conventional reservoir rock is no
longer a part of the coal estate and may be captured by the owner of the
non-coal estate under the rules that govern conventional natural gas.25
Indeed, that is the approach that Alabama and Pennsylvania have adopted
in resolving questions of CBM ownership.26
The approach followed by Alabama, Pennsylvania, and the en banc Tenth Circuit
is not only consistent with the historical treatment of "fixed"
and "fugacious" minerals, but it also answers petitioners' assertion,
made later in their brief, that the law should "deal[] tenderly"
with the private parties who own the non-coal portion of the coal lands.
See Pet. Br. 42 & note 22. Petitioners recognize that the coalification
process generates more CBM than can be retained in the coal strata, and
they state that "up to 95%" of the CBM migrates to conventional
reservoir rock, where it can be captured by the owner of the non-coal estate.
Id. at 11.27 In light of the tendency of CBM to migrate out of the coal
seams over the span of geologic time, the court of appeals' decision is
quite generous to surface owners, such as petitioners, who are entitled
to capture any such CBM that formed in the coal strata beneath their lands
but migrated out of those strata. Petitioners are simply prohibited from
removing whatever amount (which may be as little as 5% by petitioners' own
estimates) remains within the coal seam.28
c. Petitioners next suggest that, if the Coal Lands Acts are construed "in
pari materia" with the Mineral Leasing Act of 1920 (MLA), 30 U.S.C.
181 et seq., then the coal reservation cannot include gas. Pet. Br. 37-38.
That argument is unpersuasive. As we have explained, Congress enacted the
Coal Lands Acts to allow settlers to homestead lands classified as valuable
for coal, while at the same time reserving public ownership of "all
coal" beneath the surface. Congress enacted the MLA a decade later
to revise the government's methodology for leasing natural resources- including
coal, oil, natural gas, and other minerals-that the United States owned.
See 30 U.S.C. 181. The MLA, which applies to a broad range of publicly owned
minerals, specifies leasing procedures. It can have no effect whatsoever
on the scope of the mineral estate that Congress had previously reserved
under the Coal Lands Acts. To be sure, the MLA provides separate provisions
for leasing "coal" and leasing "gas" (Pet. Br. 37-38),
but those provisions say nothing about whether Congress's reservation of
"coal" under other laws includes CBM. The question of what Congress
has reserved under the Coal Lands Acts is distinct from the question of
how the government chooses to lease it under the MLA.
d. Petitioners also argue that Congress could not have intended to create
"an unprecedented and unworkable split gas estate" in which the
coal owner would be entitled to the CBM within the coal seam and the surface
owner would be entitled to any gas that migrated outside that stratum. Pet.
Br. 39. The court of appeals' solution, however, is neither "unprecedented"
nor "unworkable." As we have already explained, there is nothing
unprecedented in one party owning a coal deposit, including the CBM contained
therein, and another party owning the other minerals, including any gas
that migrates from the coal seam. See pages 32-36 & notes 20-26.29 Indeed,
two of the three States that have addressed the question of CBM ownership-Alabama
and Pennsylvania -have expressly adopted that supposedly "unprecedented"
approach. See pages 35-36 & note 26; Pet. App. 21a-24a. Furthermore,
there is no evidence that the rule adopted by the en banc court and followed
for years in Alabama and Pennsylvania is "unworkable"-to the contrary,
it appears to be far more practical than the result that petitioners urge.30
Petitioners primarily argue that the en banc court's decision is unworkable
because "it can be difficult to complete a well only in the coal seam."
Pet. Br. 40. But even if that were so (and we think it is not), that is
a matter for the Tribe and its lessees. Petitioners' obligation is simply
to avoid drilling to completion targets within the Tribe's coal seam, which
they can surely do. Petitioners' also contend that there are economies to
be gained from using a single well bore and gathering facilities "to
produce natural gas from multiple gas-bearing subsurface horizons (both
coal and noncoal)." Ibid. But if that is the case, then the self- interest
of the parties or their lessees should lead them to unitize their efforts.
Such agreements are common.31 Finally, it is not unusual for gas lessees
to determine what proportion of their gas production comes from conventional
reservoir sources and what proportion comes from unconventional CBM production
from coal seams. Indeed, they must do so to qualify for the federal tax
credit and to satisfy various state laws.32
There is, in short, nothing unworkable in recognizing that the coal owner
is entitled to the CBM within the coal seam. Petitioners' theory, in fact,
presents the more substantial problems. If the coal owner does not own the
CBM, then this Court must assume that Congress intended the federal courts
to referee, through the creation of federal common law rules, the inevitable
disputes that would arise from dividing ownership of the inextricably intermingled
components within the coal seam. For example, the federal courts would need
to answer when a federal coal lessee who mines coal, and in the process
removes CBM, must pay compensation to the surface owner for conversion of
the CBM asset; when the surface owner may enjoin coal operations if the
federal coal lessee wastes the CBM, and when the coal owner is entitled
to injunctive relief or damages if the surface owner's removal of CBM damages
the "degasified" coal. Those questions would become even more
complex if technology develops to remove liquid "coal extracts"
(page 26, supra) from coal. See Tissot and Welte 251-252; Hunt, Petroleum
Geochemistry and Geology 397-408 (2d ed. 1996). We doubt that Congress intended
to divide the coal estate in a way that would necessarily create vexing,
fact-intensive, litigation. Rather, the simpler answer here is the better
one -when Congress reserved coal, it reserved all of coal's constituents,
including the CBM present within the coal seam.
B. The Court Of Appeals Properly Invoked The Canon Of Construction That
Ambiguity In Public Land Grants Must Be Resolved In Favor Of The Sovereign
Since the early days of the Republic, this Court has repeatedly recognized
"the established rule that land grants are construed favorably to the
Government, that nothing passes except what is conveyed in clear language,
and that if there are doubts they are resolved for the Government, not against
it." Western Nuclear, 462 U.S. at 59.33 The reason for this rule is
obvious. The Property Clause grants to Congress exclusively the "Power
to dispose of and make all needful Rules and Regulations respecting the
Territory or other Property belonging to the United States." U.S. Const.
Art. IV, § 3, Cl. 2. The rule of statutory construction that "nothing
passes except what is conveyed in clear language" implements the Constitution's
express division of authority by ensuring that Congress-and not the Executive
or Judicial Branch-makes the important policy decisions respecting how,
when, and to whom the public's property shall be distributed.34
Petitioners do not challenge this deeply embedded rule of statutory construction.
They argue instead that the court of appeals erred in applying it here.
They contend, first, that the court of appeals' identification of the canon
at the outset of its decision, rather than the end, "breach[ed] the
most fundamental tenets of statutory construction." Pet. Br. 41; see
id. at 41-42. That argument borders on the frivolous. The court's stylistic
decision to identify that principle in the introductory paragraphs of its
opinion surely does not mean that the court failed to consider the statutory
text or context. To the contrary, the court's textual analysis fully comports
with the Court's guidance on construing statutes. See Pet. App. 11a-33a.
Petitioners further contend that the canon has no application because "the
meaning of 'coal' is clear as day," Pet. Br. 43-45, and that the court
of appeals' analysis of the nature of CBM is "irrelevant and wrong,"
id. at 45-50. Those arguments are also without merit. Petitioners' assertion
that the term "coal" plainly means "solid coal" does
not withstand scrutiny. As we have pointed out, Congress's use of the term
"coal," taken in its ordinary sense at the time the Coal Lands
Acts were enacted, refers to the carbonaceous substance that nature deposited
and miners mine. See pages 20-22, supra. Science confirms in rigorous detail
what Congress knew then: coal has aggregate characteristics of a solid,
but it consists of a mixture of solid, liquid, and gaseous constituents,
including CBM. See pages 22-25, supra. It would not only be completely unnatural
to define the term "coal" as "solid coal," but it would
raise a host of practical problems. See pages 25-28, supra. The historical
context of the Coal Lands Acts does not support petitioners' position, which
has been rejected by the majority of state courts that have had practical
experience with the matter. See pages 28-41, supra. Contrary to petitioners'
blithe assertion (Pet. Br. 43), then, the correctness of their proposed
construction of the term "coal" is not "clear as day."35
The en banc court recognized that petitioners' "plain language"
argument rests ultimately on such ipse dixit, and it properly concluded
that Congress had not conveyed CBM, either expressly or by fair implication,
to homesteaders who occupied the surface of lands containing coal deposits.
Congress did not squarely address the issue, but a careful analysis of the
statutory language, its specific context, and the broader context of the
statute as a whole, Robinson, 519 U.S. at 341, demonstrates that the most
natural reading of the 1909 and 1910 Acts is that Congress intended to reserve
CBM as a constituent of the coal. At the very least, those Acts do not unambiguously
convey the CBM constituent. The en banc court of appeals was therefore correct
to apply the familiar statutory canon that public grants are construed in
favor of the government and that nothing passes except what is conveyed
in clear language, and to hold that the "coal reserved to the United
States in the 1909 and 1910 Acts includes the adsorbed CBM." Pet. App.
32a-33a.
The en banc court's application of the canon to CBM not only makes sense
in light of the text and the context of the 1909 and 1910 Acts, but it also
makes sense in light of the purpose of the statutory canon. It is clear
from the text and legislative history of the 1909 and 1910 Acts that Congress
did not expressly consider the important policy questions respecting CBM
development on public lands that would inform a decision to convey CBM while
reserving the remainder of the coal deposits, and it could not have done
so in light of the lack of technology for developing the CBM resource at
that time. If this Court agrees with the en banc court, then Congress-the
Branch of government that the Constitution charges with such decisions-will
have the opportunity to deliberate on the matter in light of current technology
and will be able to make a conscious decision based on the public interest.
Cf. Kiowa Tribe v. Manufacturing Techs., Inc., 118 S. Ct. 1700, 1705 (1998)
("The capacity of the Legislative Branch to address the issue by comprehensive
legislation counsels some caution."); note 28, supra. If the Court
rules for petitioners, however, then those important policy questions will
be resolved through happenstance and windfall.36
C. The Solicitor Of The Interior Acted Properly In Withdrawing His 1981
Opinion
As we have explained, the Solicitor of the Interior issued an opinion in
1981 concluding that Congress had not reserved CBM through the Coal Lands
Acts of 1909 and 1910. See pages 11-12, supra. The 1981 opinion was subjected
to critical scrutiny for the first time in this litigation, where a unanimous
court of appeals panel rejected it. The Solicitor carefully reviewed the
court of appeals' analysis, first in the panel opinion and then in the en
banc decision, and he concluded, in consultation with the Justice Department,
that the 1981 opinion was incorrect and should not be defended in this Court.
Petitioners have charged that the Solicitor actually withdrew the opinion
because he was "intent on preserving at all costs a ruling in favor
of the Southern Ute Tribe," and that he acted "in an attempt to
short-circuit this Court's review." Pet. Reply Br. 1 (petition stage).
Indeed, petitioners go so far as to state that, "[i]n an age of cynicism,
it is difficult to imagine a more blatantly political and cynical act than
Interior's one-line order." Ibid. Petitioner is mistaken.
First, as we explained in our brief in opposition, this Court has itself
recognized that government agencies have an obligation to reexamine their
legal interpretations on a continuing basis in light of new judicial decisions
and insights gained through litigation. See Fed. Resp. Br. in Opp. 25-26;
see, e.g., Estate of Cowart v. Nicklos Drilling Co., 505 U.S. 469, 476 (1992);
United States v. Morton, 467 U.S. 822, 835-836 note 21 (1984) ("Litigation
often brings to light latent ambiguities or unanswered questions that might
not otherwise be apparent."). Thus, there was nothing inappropriate
in the Solicitor's reexamining the 1981 opinion in light of the court of
appeals' decisions. Moreover, the Solicitor's decision to reexamine the
question was a matter of public record in the court of appeals. At the rehearing
en banc stage, the government informed the court of appeals and the parties
that "the panel decision of the court has prompted the Solicitor of
the Interior to commence a review of the analysis set out in [the 1981 opinion]"
and that the "review is ongoing and could conceivably result in a modification
of the views expressed therein." Pet. App. 8a-9a note 2. Indeed, government
officials met repeatedly with representatives of both petitioners and the
Tribe to discuss the matter.
The government's reexamination of the issue revealed that the Solicitor's
1981 opinion had failed to identify and consider the full range of considerations
that had since come to light in the course of defending it in an adversarial
context. In addition, like many past agency decisions that did not have
the benefit of this Court's more recent statutory guidance, the 1981 opinion
did not contain a rigorous evaluation of the text of the relevant statutes.
As we explained in our brief in opposition, the reexamination of the 1981
opinion (which included discussions with the parties in this litigation)
revealed that the 1981 opinion was deficient and ultimately unpersuasive.
Fed. Resp. Br. in Opp. 25-28. Based on that analysis, the Solicitor decided
that the opinion was incorrect and should be withdrawn. Ibid.
Contrary to petitioners' accusations, the Solicitor did not withdraw the
opinion to secure a ruling in favor of the Tribe. We made clear in our brief
in opposition (at note 8) that this is not an "Indian law" case
and has not been regarded by the United States as such (see note 7, supra).
The Solicitor withdrew the 1981 opinion because, as we have laid out in
the discussion at pages 17-44, supra, the legal analysis contained therein
is unpersuasive. The United States remains a defendant in the Tribe's action
and will continue to assert its valid defenses, but the United States' obligation
is to see that justice is done, and it has no interest in attempting to
prevail on an incorrect legal theory. See Berger v. United States, 295 U.S.
78, 88 (1935). Nor was the Solicitor's decision a "blatantly political"
act. The decision was the product of a painstaking and entirely regular
deliberative process within the government, with input from petitioners
on numerous occasions, and it rests on the legal analysis set out in this
brief. That analysis, in turn, places the policy question of CBM ownership
squarely in the hands of Congress-which is where it should be.37
Petitioners also contend that the Solicitor's withdrawal of the 1981 opinion
has unsettled their justified expectations. Pet. Reply Br. 1 (petition stage).
The Solicitor gave that matter careful consideration in deciding whether
to withdraw the opinion, but he was also obligated to consider certain important
facts that petitioners have not highlighted. First, many of the petitioners
had commenced the gas leasing or drilling activities at issue in this case
before the Solicitor had issued his 1981 opinion. Second, the question of
CBM ownership was clouded at the time the Solicitor issued his 1981 opinion,
see pages 10-12 & note 5, supra, and the opinion itself made clear that
"nothing in this opinion warrants title to any oil and gas deposit."
Pet. App. 159a. Third, the decisions from the Alabama and Pennsylvania courts-as
well as a competent title examination-would have put any prudent landowner
on notice that title to CBM was uncertain. And fourth, petitioners (who
include a sophisticated multi-national oil company) could have taken steps
to reduce their risk of exposure by resolving the title disputes before
commencing development. As the court of appeals panel explained, "neither
Amoco, the oil industry at large, nor the Department of the Interior have
previously assumed the Solicitor's opinion resolved private CBM property
rights, as Amoco now advocates it should." Id. at 80a note 20 (citing
internal Amoco memoranda).
It is well known in the oil and gas industry that "[a]nytime a conflicting
claim of title is made to the minerals, subsequent development of the land
becomes ultrahazardous." 1 Williams & Meyers, Oil and Gas Law §
225, at 386.8 (1996). Petitioners consciously elected to take the "ultrahazardous"
step of drilling first and dealing with legal challenges to their title
later. Petitioners' claims of reliance must be viewed in that light. Indeed,
even if petitioners' reliance interests were stronger, they could not, in
the end, determine the United States' position in litigation before this
Court. It is inappropriate for the United States to defend a legal position
before the Court-even one that it once supported-if the government has concluded
that the position is wrong.
CONCLUSION
The judgment of the court of appeals should be affirmed.
Respectfully submitted.
SETH P. WAXMAN
Solicitor General
LOIS J. SCHIFFER
Assistant Attorney General
EDWIN S. KNEEDLER
Deputy Solicitor General
JEFFREY P. MINEAR
Assistant to the Solicitor General
JEFFREY C. DOBBINS
ELIZABETH ANN PETERSON
Attorneys
JOHN D. LESHY
Solicitor
Department of the Interior
Interior
APRIL 1999
1 Coal's pore structure differs in important respects from that found in
conventional "reservoir" rocks that contain hydrocarbon gas and
liquids. In the case of coal, the pore structure originated from the same
organic material that comprises the contained hydrocarbons; the pore structure
is itself composed of hydrocarbons; and the pores are orders of magnitude
smaller than those found in conventional reservoir rocks, which hold hydrocarbons
that migrated from elsewhere. See Levine, Coal Composition, as Related to
the Mode of Occurrence of "Coalbed Methane" (1992) (JA 608-611).
"To provide a concept of scale: A single methane molecule residing
in a 1 millimeter-diameter pore [typical of conventional reservoir rock]
has the same 'aspect ratio' as a pin point (not a pin head) in a football
field; whereas the microporosity in coal is barely larger than the sorbate
molecules that reside within it." JA 610.
2 Colloids are "systems" made up of a combination of liquids,
gases, or solids in which one phase is dispersed in another. See, e.g.,
1 Van Nostrand's Scientific Encyclopedia 697-700 (7th ed. 1988). For example,
milk is a colloid consisting of a solid dispersed in a liquid, vinaigrette
is a colloid consisting of a one liquid dispersed in another insoluble liquid,
and jam is a colloid consisting of a liquid dispersed in a solid. See ibid.
Viewed from this perspective, coal is a "solid colloid" consisting
of gaseous and liquid hydrocarbons dispersed within the solid macromolecular
matrix. See Van Krevelen 193, 598.
3 Petitioners assert that CBM "is simply natural gas." Pet. Br.
12. But as petitioners acknowledge, the term "natural gas" is
generally used to describe "the gaseous phase of petroleum." Hunt,
Petroleum Geochemistry and Geology 185 (2d ed. 1996). See Pet. Br. 8. Petitioners
are correct that CBM and natural gas both consist of a mixture consisting
primarily of methane. Id. at 9, 12. But we apply the term CBM specifically
to the methane-rich mixture that is produced through the coalification process
and that remains within the coal bed. That is the only substance at issue
here. See Pet. App. 18a note 8.
4 Congress also took other steps during the same era to preserve public
ownership of mineral resources. In 1910, Congress enacted the Pickett Act,
which affirmed the President's authority to withdraw public lands for waterpower
sites, irrigation, classification of lands, or other public purposes. Act
of June 25, 1910, ch. 421, 36 Stat. 847. During the early part of this century,
the President exercised Pickett Act authority as well as inherent withdrawal
authority in the interest of natural resource conservation. See United States
v. Midwest Oil Co., 236 U.S. 459 (1915). And in the years following enactment
of the Coal Lands Acts, Congress enacted a series of additional statutes
to reserve other non-metaliferous minerals.
In 1912, Congress enacted a statute allowing agricultural entry on lands
withdrawn or classified as valuable for petroleum in the State of Utah,
reserving "the oil and gas in such lands" and "the right
to prospect for, mine, and remove the same." Act of Aug. 24, 1912,
ch. 367, § 1, 37 Stat. 496. In 1914, Congress enacted the Agricultural
Entry Act, which generally allowed agricultural entry of lands identified
as valuable for phosphate, nitrate, potash, oil, gas, or asphaltic minerals,
subject to a reservation of "the deposits on account of which the lands
were withdrawn or classified or reported as valuable." Ch. 142, §
1, 38 Stat. 509 (currently codified at 30 U.S.C. 121-123). And in 1916,
Congress enacted the Stock-Raising Homestead Act, ch. 9, 39 Stat. 862 (currently
codified as 43 U.S.C. 291 et seq.), which authorized the issuance of patents
subject to a reservation of "the coal and other minerals in the lands,"
§ 9, 39 Stat. 864. See Western Nuclear, supra.
5 See also, e.g., Bowles, Coalbed Gas: Present Status of Ownership Issue
and Other Legal Considerations, 1 E. Min. L. Inst. 7-1 (1980); Craig &
Myers, Ownership of Methane Gas in Coalbeds, 24 Rocky Mtn. Min. L. Inst.
767 (1978); McGinley, Legal Problems Relating to Ownership of Gas Found
in Coal Deposits, 80 W. Va. L. Rev. 369 (1978); Olson, Coalbed Methane:
Legal Considerations Affecting Its Development As An Energy Resource, 13
Tulsa L.J. 377 (1978).
6 The Tribe additionally filed suit against the United States in what is
now the United States Court of Federal Claims, alleging that the United
States had breached its trust obligation to protect the Tribe's interest
in property with respect to development of the CBM. See U.S. C.A. Br. 26
note 7.
7 The district court did not address affirmative defenses, including the
United States' assertion that the action against the United States was barred
by the applicable statute of limitations. See Pet. App. 130a-131a. The district
court correctly rejected the Tribe's invocation of the principle that doubts
regarding the interpretation of statutes be resolved in favor of the Indians
in this case. As the district court pointed out, the Acts are public land
laws, not statutes passed for the special benefit of Indians. Id. at 127a.
8 The United States did not petition for rehearing en banc. After rehearing
en banc was granted, the United States filed a supplemental brief explaining
that it had previously endorsed petitioners' arguments on the basis of the
1981 Solicitor's opinion and not merely on the basis that the question of
CBM ownership should be resolved by reference to the dictionary meaning
of the term "coal." See Pet. App. 9a note 2. The United States
additionally explained that, in light of the panel's decision, the Solicitor
of the Interior had commenced a review of the analysis set out in the 1981
Solicitor's opinion and that the review could conceivably result in modification
of the views expressed therein. Ibid.
9 The various Interior Department regulations and publications that petitioners
cite follow that pattern as well. See Pet. Br. 24. Those regulations and
publications simply describe the general appearance and classification of
coals; they do not speak, one way or the other, as to whether CBM is a constituent
of coal.
10 Although petitioners cite Van Krevelen's text (Pet. Br. 7) for the proposition
that coal is a "rock," they fail to mention the more pertinent
portions of his book.
11 Many organic and inorganic substances that might be described for definitional
purposes as either "solid" (e.g., wood, resin, cheese, paste,
peanut butter, and jelly) or "liquid" (e.g., glue, petroleum,
salad dressing, paint, ink, milk, and mineral water) consist of a mixture
of two or more coexisting liquid, gaseous, or solid components. Similarly,
a substance that might be described as a "gas"-such as the ambient
air or the exhaust gases of a car, fireplace, or other combustion process-may
include solid particulates and droplets of moisture. The fact that a substance
might be characterized in aggregate as a solid, liquid, or gas does not
mean that the other, less obvious components are not essential constituents.
See also note 2 (discussing colloidal systems).
12 See American Geological Institute, Dictionary of Geological Terms (1980)
(JA 372) (defining coal as "a readily combustible rock containing more
than 50% by weight and more than 70% by volume carbonaceous material, including
inherent moisture"); see also, e.g., Levine Aff., JA 345-346; Bend
Aff., JA 304; Marsh Aff., JA 398.
13 To be sure, the ASTM test for "volatile matter" involves heating
the coal and therefore includes both matter that is volatile at ambient
temperature and matter that becomes volatile as a result of thermal decomposition.
See Levine Rep., JA 595 note 4. Nevertheless, the point remains that, under
petitioners' construction, the portion of that "volatile matter"
that is not a thermal decomposition product must be considered a non-ingredient
of the coal. See Levine Aff., JA 349.
14 See, e.g., 30 U.S.C. 552 ("'Coal' means any of the recognized classifications
and ranks of coal, including anthracite, bituminous, semibituminous, subbituminous,
and lignite."); 42 U.S.C. 8302(a)(5) ("The term 'coal' means anthracite
and bituminous coal, lignite, and any fuel derivative thereof.").
15 Petitioners' remaining "plain meaning" argument-that the "surrounding
provisions of the 1909 and 1910 Acts" also support their construction
(Pet. Br. 25-27)-is without merit. The provisions that petitioners cite
say nothing about the matter at issue here: a homesteader could use "coal"
for "domestic purposes" (id. at 25) and an entryman could contest
whether land was properly classified as coal land (id. at 25-26) whether
or not the reserved "coal" included CBM. The more significant
such provisions are those that refer to "coal deposits" (35 Stat.
844). Those provisions suggest that Congress was reserving the coal "beds"
or "strata" rather than some ill-defined "solid" subset
of those naturally occurring "deposits." See USGS, Dep't of the
Interior, The Valuation of Public Coal Lands (1910) (JA 505-507) (describing
deposits on the basis of beds or strata). See discussion at pages 32-41
infra.
16 Indeed, it would have been quite remarkable for Congress to separate
ownership of the coal from ownership of CBM in light of the hazards that
escaped CBM posed to miners. The coal lessee was generally responsible under
both federal and state law to protect its miners and the public from the
emissions of hazardous mine gases. See, e.g., Deserant v. Cerillos Coal
R.R. Co., 178 U.S. 409 (1900). Congress had no reason to transfer that CBM,
and the potential liability for its release, to the agricultural homesteader,
who had no conceivable use for the substance. See Pet. App. 20a-21a.
17 In 1907, the USGS reported to Congress that "[w]ood already is almost
a thing of the past; oil, although used extensively in some parts of the
country for the production of power, is necessarily of limited occurrence
and before long may cease to be an important factor in the problem. Coal,
therefore, is the fuel of the present, and, so far as can be seen, will
continue to lead in this particular for a long time to come." H.R.
Doc. No. 823, 59th Cong., 2d Sess. (1907) (JA 404).
18 We note that the author of this article, like other contemporary scientists
and the miners and geologists of an earlier era, unhesitatingly treats "methane"
and "other higher hydrocarbons contained in the coal" as "components"
of the coal. JA 532.
19 It is particularly hazardous here, because Representative Mondell was
generally an opponent of conservation legislation. President Roosevelt described
Mondell as "'a Congressman who took the lead in every measure to prevent
the conservation of our natural resources" and "who consistently
fought for local and private interests as against the interests of the people
as a whole.'" Swenson 727 (quoting Roosevelt, An Autobiography 363,
393 (1913) (1924 rep.)). Mondell candidly admitted that his perspective
reflected a minority view. In a colloquy with other Western representatives,
he stated that "we must recognize this fact, that in the country at
large public sentiment was behind President Roosevelt, and has been behind
President Taft, and that the principal complaints that have been made, save
those that have been made by some of us from the West, have been not that
there was too much withdrawal, but that there was not enough withdrawal,
or that there was too much restoration." 45 Cong. Rec. 4644 (1910).
20 See, e.g. 1 Ricketts, American Mining Law 600 & note 10 (1948) (Ricketts)
("it is familiar law that there may be two freeholds in the same body
of land, that is to say, a freehold in the surface soil and enough of the
earth lying beneath the surface to support it, and a freehold in the minerals
underneath the surface estate, with a right of access to mine and extract
the minerals"); id. at 602 note 25 ("Each of the separate layers
or strata becomes a subject for taxation, of incumbrance, levy and sale,
precisely like the surface."); Morrison & De Soto, Mining Rights
on the Public Domain 300 (15th ed. 1917) (severance of a mineral estate
"amounts practically to a partition on a horizontal plane"); 1
Lindley, American Law Relating to Mines and Mineral Lands 18 (3d ed. 1914)
("[T]he different strata of the subsoil might be shown to be the subject
of different rights. * * * Thus, one person might be entitled to the iron,
and another to the limestone. One seam or stratum of coal, if in the same
lands, might belong to a third person, and another distinct seam to a fourth
owner."); id. at 1996-1997 (same); id. at 2003-2004 (describing the
Coal Lands Acts as an example of such "severance of title"); see
also, e.g., Cherokee & Pittsburg Coal & Mining Co. v. Board of County
Comm'rs, 80 P. 601, 602 (Kan. 1905) (creation of a separate mineral estate
results in land being "divided horizontally"); In re Major, 134
Ill. 19, 22 (1890) (as a result of a coal reservation, "ownership of
the coal was severed from the ownership of the soil"); Sanderson v.
City of Scranton, 105 Pa. 469, 474 (1884) (coal lease was in effect "a
severance of the surface from the underlying strata, as created a divided
ownership in these distinct portions of the land"); cf. Pennsylvania
Coal Co. v. Mahon, 260 U.S. 393, 412 (1922) ("The deed conveys the
surface, but in express terms reserves the right to remove all the coal
under the same.").
21 Some States embraced the non-ownership view and held that no one owned
oil and gas until it was actually produced; others took the view that the
surface owner had a "qualified ownership"; others took the view
that oil and gas, like fixed minerals, could be "owned in place";
and others focused on ownership of the strata in which the oil or gas resided.
1 Williams & Meyers, Oil and Gas Law § 203 (1996) (Williams &
Meyers) (discussing the four primary theories). It is difficult to decipher
which States had adhered to a particular theory at any given time, but the
"ownership in place" theory is now the majority view. Id. §
203.3. See also id. § 203, at 32.2 (chart showing current approaches
of the various States). Contrary to petitioners' incomplete portrayal of
the law (Pet. Br. 25, 39-40), the "qualified ownership" theory
followed in Oklahoma, see Champlin Refining Co. v. Corporation Comm'n, 286
U.S. 210, 233 (1932), and the "nonownership theory" followed in
Indiana, see Ohio Oil Co. v. Indiana, 177 U.S. 190, 209 (1900), reflect
minority views.
22 See generally Williams & Meyers § 204.4 (discussing rule of
capture).
23 A commentator from California (a "nonownership" State) described
the principle as follows: "Oil and gas are often found in separate
and distinct strata under the surface of the soil, and these strata are
entirely separate and distinct and disconnected from one another; these
different strata of oil-bearing rock or shale are frequently found in a
horizontal position and the drilling of a well into one of these strata
and the extraction of oil and gas therefrom may not, and usually does not,
affect the oil and gas contained in other strata. * * * A lease dividing
the lands horizontally and leasing only certain strata thereof would be
binding upon the parties. Acting under such a lease it would be a trespass
for the lessee to drill into or in anywise extract oil or gas from any stratum
of oil or gas-bearing rock not included within the terms of the lease."
Ricketts 603 (emphasis added).
24 See, e.g., Kansas Natural Gas Co. v. Board of County Comm'rs, 89 p. 750,
752 (Kan. 1907) ("until gas is actually produced and severed, so that
it becomes personalty the legal title to, and possession of, the entire
volume remain in the owner of the strata in which it is confined").
25 Under the rules of accommodation, the owner of the non-coal estate may
drill through the coal stratum to reach oil and gas elsewhere, see, e.g.,
Chartiers Block Coal Co. v. Mellon, 25 A. 597, 599 (Pa. 1893), and under
the rule of capture, that owner could even drain gas from the coal stratum
(assuming it is physically possible to do so) so long as the owner does
so from a drilling target placed outside that stratum, cf. Williams &
Meyers § 204.4. But that owner could not invade the coal stratum, fracture
it, and then remove the CBM that would otherwise remain within the coal
seam. Cf. Kidwell v. General Petroleum Corp., 212 Cal. 720, 729 (1931) (a
lessee may not "drill into or in anywise extract oil or gas from any
stratum of oil or gas bearing rock not included within the terms of its
lease").
26 See NCNB Tex. Nat'l Bank v. West, 631 So.2d 212 (Ala. 1993)(adsorbed
CBM is part of coal estate); Vines v. McKenzie Methane Corp., 619 So.2d
1305, 1309 (Ala. 1993) (grant of "all coal" included coalbed methane);
United States Steel Corp. v. Hoge, 468 a.2d 1380 (Pa. 1983) (right to "drill
through coal" for gas did not include right to recover adsorbed CBM).
But see Carbon County v. Union Reserve Coal Co., 898 P.2d 680, 681 (Mont.
1995)(grant of "all coal and coal rights" did not include CBM).
27 We note that petitioners inconsistently assert, on the following page
of their brief, that "up to 60% of the gas in the Fruitland Coal Formation
at issue in this case actually migrated into the coal seam." Pet. Br.
12. Petitioners cite Scott et al., Thermogenic and Secondary Biogenic Gases,
San Juan Basin, Colorado and New Mexico-Implications for Coalbed Gas Producibility,
78 AAPG Bull. 1186, 1206 (1994), but they have exaggerated the significance
of that article, which was not a part of the record. The Scott article posits
that one portion of the Fruitland coal formation (the "high permeability"
portion) underwent "secondary biogenesis," (i.e., was metabolized
by bacteria late in the coalification process), and the CBM produced therefrom,
as well as "thermogenic" (i.e., temperature produced) gases, migrated
to the overlaying Kirtland shale formation. See id. at 1186, 1204 Fig. 13
(showing migration route). The article suggests that "12-60%"
of the "coalbed gases" in "the northern San Juan Basin"
may consist of "migrated thermogenic gases." Id. at 1186, 1206.
The article, which we have lodged with the Court, does not elaborate on
whether any of that broad possible range of "migrated thermogenic gases"
includes gas from non-coal sources that have migrated into the coal seam.
While it is possible for external gases to migrate into naturally occuring
fractures in the coalbed, substantial migration is unlikely. See Marsh Aff.
JA 380-381, 395.
28 Petitioners also make a footnote reference in this portion of their brief
(Pet. Br. 36 note 18) to the Act of March 4, 1933, ch. 278, 47 Stat. 1570
(codified at 30 U.S.C. 124) and the Uraniferous Lignite Act (ULA), 30 U.S.C.
541-541e. As a general matter, those enactments are relevant primarily as
examples of situations in which Congress has acted to resolve ambiguities
in previous statutory grants. We agree with the en banc court that neither
of those statutes is instructive on Congress's specific intent with respect
to CBM in the 1909 and 1910 Acts. See Pet. App. 31a-32a n.18. In the case
of the Act of March 4, 1933, Congress faced the question of whether the
surface owner or a potash lessee owned sodium compounds that were intermixed
with potash. Congress had not foreseen that problem, and it resolved the
ambiguity by allowing agricultural entry onto lands containing the sodium
compounds, but reserving the sodium therein. See 30 U.S.C. 124; H.R. Rep.
No. 1938, 72d Cong., 2d Sess. (1933). In the case of the ULA, Congress addressed
an ambiguity respecting a surface owner's right to remove "source material"
(uranium) from lignite deposits. As the court of appeals noted (after questioning
petitioners' interpretation of the legislative history), "Congress's
allocation of the right to extract uranium in coal cannot be equated to
the CBM at issue here because uranium," which is not a hydrocarbon,
"is not invariably included in the coal as part of the coalification
process." Pet. App. 32a n.18.
29 Notwithstanding their concern for precedent, petitioners base their contentions
in this section of their brief on either the "nonownership" or
"qualified ownership" theory of oil and gas (see Pet. Br. 39-40),
which reflects the approach of a minority of States. As we have explained
(note 21, supra), most States apply the "ownership in place" theory,
under which "the nature of the interest of the landowner in oil and
gas contained in his land is the same as is his interest in solid minerals."
See Williams & Meyers § 203.3. We do not belabor this point because
there is no impediment under any of the theories of oil and gas ownership
(or under Western Nuclear, see Pet. Br. 49 note 24) to treating CBM as part
of the coal. See pages 33-36, supra; note 30, infra.
30 Significantly, although Alabama follows the "nonownership"
theory of oil and gas (Williams & Meyers § 203.1, at 34), and Pennsylvania
follows the "ownership in place" theory (id. § 203.3, at
48), each State treats CBM the same way. The Solicitor of the Interior suggested
in a 1990 opinion that Pennsylvania's result depended on a "stratum"
theory of gas ownership (Pet. App. 171a), but that is not strictly accurate.
Pennsylvania relied on the fact that the coal owner owned the coal strata
and that the CBM was part of the coal. See id. at 23a. The Solicitor was
correct that the Indian Mineral Leasing Act does not authorize an Indian
Tribe to grant away its fee interest in an underlying stratum (id. at 171a).
But nothing in that Act would necessarily prevent a Tribe from leasing on
a royalty basis the entire coal deposit or only the CBM component of that
deposit.
31 See, e.g., Lewin, Coalbed Methane: Recent Court Decisions Leave Ownership
"Up in the Air," But New Federal and State Legislation Should
Facilitate Production, 96 W. Va. L. Rev. 631, 648 (1994) ("CBM development
usually requires a negotiated compromise among gas owners and coal owners,
and a 50-50 split is not an uncommon arrangement.").
32 See, e.g., 26 U.S.C. 29; C.A. Supp. App. 543-544 (citing New Mexico Oil
Conservation Division Orders R-8768 & R-8769 (effective Nov. 1, 1988)
(requiring that "gas production totals for * * * coal beds and * *
* sandstones be kept separately")).
33 E.g., Andrus v. Charlestone Stone Prods. Co., 436 U.S. 604, 617 (1978);
United States v. Union Pac. R.R., 353 U.S. 112, 116 (1957); Caldwell v.
United States, 250 U.S. 14, 20, (1919); Northern Pac. Ry. v. Soderberg,
188 U.S. 526, 530 (1903); United States v. Arredondo, 31 U.S. (6 Pet.) 691,
728 (1832).
34 The same rationale that justifies the rule also determines the rule's
limits. In the specific context of railroad grants, the Court has stated
that "public grants are construed strictly against the grantees, but
they are not to be so construed as to defeat the intent of the legislature,
or to withhold what is given either expressly or by necessary or fair implication."
Leo Sheep Co. v. United States, 440 U.S. 668, 682-683 (1979) (quoting United
States v. Denver & Rio Grande Ry., 150 U.S. 1, 14 (1893)).
35 As yet additional evidence of ambiguity, we point out that academic commentators
have long mooted the question whether "coal" includes CBM. See,
e.g., text and cited articles at notes 5 and 31. Furthermore, Congress enacted
legislation in 1992 that acknowledged the ongoing debate in various settings
and created a framework to assist the States in resolving CBM ownership
issues where they arise as a matter of state law. See Energy Policy Act
of 1992, Pub. L. No. 102-486, § 1339, 106 Stat. 2986 (codified at 42
U.S.C. 13368).
36 Congress may, of course, ultimately decide to allow the surface owners
to develop CBM in those situations in which the government continues to
own the coal reserves. It has already done so in the case of surface owners
who had previously commenced CBM leasing and drilling activities. See Federal
Resp. Br. in Opp. 22-24 (discussing the Enzi Act, Pub. L. No. 105-367, 112
Stat. 3313). If Congress concluded that the equities warranted such action,
Congress could also provide special relief for the landowners involved in
this unusual case. As we explained in our brief in opposition, the Department
of the Interior has failed to identify any non-federal entity, other than
the Southern Ute Indian Tribe, that has succeeded to the United States'
reservation of coal under the 1909 and 1910 Acts. Fed. Resp. Br. in Opp.
22.
37 The Solicitor of the Interior withdrew the opinion in a "one-line
order" on account of petitioners' own assertions of exigency. After
the Solicitor General informed petitioners (following several government
meetings with their counsel) that the government would not support their
certiorari petition, petitioners opposed the government's request for a
30-day extension of time to file a brief in opposition. The government's
request for an extension of time was limited to 14 days, ending on January
4, 1999. That time period did not allow sufficient time for the Solicitor
of the Interior to prepare a formal opinion.