Oil and gas companies deal with products which involve oil and its derivatives traversing land in private ownership for
the purpose of getting to the end consumer. At the various stages of the journey however, the transporter will require various passage rights. Naturally, this will differ from one jurisdiction to another. An example of such is that, final distribution of petroleum products to filling stations will most certainly involve the use of public rights of highway because petroleum is transported in tankers passing through public roads. In gas supply on the other hand, final distribution of gas often requires the laying of pipelines in public roads by means of statutory rights.
The movement of petroleum products described above will undoubtedly raise property law issues, if loosely addressed. This paper will therefore look at the nature of rights required by oil and gas companies to convey their products along pipelines passing through land in private ownership.
Giving its simplest definition, the word ‘property’ connotes; “the right to ownership of a thing and the thing to which that right relates to”. The right of a landowner is that of exclusive possession of heritable property. The word ‘property’ is a complex term whose correct meaning can only be deduced from the context in which it is used. It is said to run a coelo usque ad centrum (from the centre of the earth to the outer limits of space).As an exclusive right, the holder of the right to a property has that much right of control of the property within the limits of his right; ‘zonder noodigh opzicht op een ander mensh’(meaning; without necessary relation to another man).
However, provisions have emerged by ways of Statues mitigating the hardship associated with transportation of goods and services in the oil and gas sector. An oil company may erect a pipeline without necessarily owning the property whereupon the pipelines are buried. Therefore, a property Lawyer specialising in the oil & gas industry, advising on the transportation of petroleum products must be armed with adequate local jurisdictional laws which enhances the rights of passage of the oil company’s pipelines.
RIGHTS OF PASSAGE
The rights of ownership of a land may either be a real right or personal rights. Generally, a real right is enforceable against all persons who seek to deal with the thing to which a real right relates with in any shape or form inconsistent with the exercise of the right holder’s powers over the thing. Broadly speaking, transportation of oil & gas must pass through either the Land or the sea. A landowner, therefore, has the right to refuse entry of uninvited access unto his land; as such persistence may constitute trespass. In the same vein, a landowner may also prevent the erection of a building on his land even where it can be evidenced that such a structure must be built in national interest.
As mentioned above, there are instances where the landowners may refuse the desired occupation of land, such permission may be obtained by the oil company under statutory compulsion while the onus is on the applicant to demonstrate conformity with the statutory purpose for seeking the permission. As a direct consequence, the landowner, having been deprived of his property, must be paid prompt compensation; a sine qua non to revocation. But one thing is certain, the right sought for under the law must be a right known to the law of that jurisdiction.
ASPECTS OF PROPERTY LAW
An oil and gas Lawyer must naturally provide answers to the questions below before proceeding to advising a client on the transportation of oil and gas;
a) In which jurisdiction(s) will the oil company be required to comply with certain passage right(s)?
b) What are those passage rights that are required to be complied with?
c) Will they be in the best interest of the company vis-à-vis the nature of the business?
d) What are the implications (if any) of none compliance with those passage rights?
Sequel to the above, it stands to reason that an oil company cannot pounce on the land of another individual or state without seeking for and obtaining the necessary permits, prominent of which are the real rights.
Real rights may vary from one jurisdiction to the other. Obtaining real rights may be a herculean task, especially when the landowner is not willing to give up/fragment his rights over the property. Real rights however, is the right enforceable against, not only the donor/grantor of the right, but also against its successors, agents, heirs and even the rest of the world, even when not privy to the contract.
We shall now consider such rights which are often used both in the United Kingdom and Nigeria when seeking to access to property;
i) Ownership
ii) Praedial Servitude
iii) Leases.
check back next week for the second installment.
Of course we have the breakout sessions dedicated to the various practice areas including arbitration, transportation, capital markets, communication, taxation, aviation, practice development, information technology, travel, tourism 
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