Does the federal government own the pore space under private lands in the West? Implications of the Stock-Raising Homestead Act of 1916 for geologic storage of carbon dioxide.

• Author: Doran, Kevin L.

1. INTRODUCTION II. HISTORICAL ORIGINS OF THE STOCK-RAISING HOMESTEAD ACT OF 1916 III. ANALYSIS OF CASE LAW IV. APPLYING THE WAIT TEST TO PORE SPACE A. Arguments that Pore Space Fails the Watt Test B. Meeting the Watt Test: Why Pore Space Is an SRHA Mineral 1. Mineral in Character 2. Removable from the Soil 3. Commercial Value 4. Benefit to the Surface Estate V. IMPLICATIONS FOR CCS VI. CONCLUSION I. INTRODUCTION

   There is really only one reason to take on the technically challenging, legally tortured, and economically cloudy task of storing carbon dioxide (C[O.sub.2]) deep within the earth where it will--hopefully--remain indefinitely, trapped within the microscopic voids and fractures of rock known as pore space or transformed into solid carbonates over many years through the process of mineralization. (1) That reason, of course, is climate change. Storing C[O.sub.2] deep underground is widely viewed as an integral component of a larger United States and global strategy for reducing net emissions of greenhouse gases (GHGs), (2) which will consequently help to stabilize atmospheric concentrations of GHGs.

   For geologic carbon storage to play this important role, however, a whole lot of C[O.sub.2] will need to be stored underground; and, consequently, a whole lot of underground space will be needed to store it. (3) According to several recent estimates, achieving a significant impact on stabilizing atmospheric C[O.sub.2] concentrations will require, at a minimum, a 90% reduction in COt emissions from fossil fuel power plants. (4) Attaining reductions of this magnitude will almost certainly require a relatively large contribution from carbon capture and storage (CCS). (5) As a result, the sheer volume of C[O.sub.2] that will need to be geologically sequestered is enormous.

   One large, coal-fired power plant releases about 8 million tons of C[O.sub.2] per year into the atmosphere. (6) According to Benson and Cole, "[S]equestering the C[O.sub.2] emissions from a power plant with a 50-year lifetime would require a volume of about 500 [million cubic meters ([Mm.sup.3])]." (7) To put this into perspective, the total volume of the Great Pyramid of Giza is thought to be around 2.5 [Mm.sup.3]. (8) Putting 500 [Mm.sup.3] of C[O.sub.2] into the subsurface over a fifty-year span is the equivalent of putting four Great Pyramids of Giza consisting entirely of C[O.sub.2] into the subsurface every year for fifty years--and this is just for one power plant. In terms of the geographic footprint this would require, one such plant could need between 300 to 11,000 [km.sup.2] (186 to 6835 [m.sup.2]) of pore space in which to store its C[O.sub.2] for thirty years. (9)

   Let us assume there are about 315 large (one gigawatt (GW)-size) coal-fired power plants in the United States, each emitting a volume of about 10 [Mm.sup.3] of C[O.sub.2] per year. (10) Every year this would require the subsurface storage of about 1260 Great Pyramids of Giza. Over fifty years, this would equal the storage of some 63,000 Great Pyramids. The aggregate volume of all these pyramids would be roughly equivalent to 63 million Olympic-sized swimming pools. (11)

   So clearly, a great deal of subsurface space is needed to store all of this C[O.sub.2]. Fortuitously, it appears there is plenty of potential subsurface storage space for the C[O.sub.2], even given the massive quantities that will need to be stored. According to the most recent estimate by the U.S Department of Energy (DOE), which includes estimates for off-shore storage capacity, there could be as much as 1800 billion to more than 20,000 billion metric tons of C[O.sub.2] storage capacity throughout the United States and portions of Canada. (12) At current emission rates, this potentially represents the availability of 500 to 5700 years of storage capacity for the United States and portions of Canada. (13) Much of this storage capacity is concentrated in the western United States. For the low-end of DOE's estimate for onshore storage capacity, ten western states--Arizona, California, Colorado, Idaho, Montana, New Mexico, North Dakota, Utah, Washington, and Wyoming--represent 35.6% of this total; for the high-end estimate, these same states represent 36.5% of the total onshore storage capacity. (14)

   For our purposes, here is where the story gets interesting. As vast amounts of C[O.sub.2] are injected deep underground, much of it will end up residing in pore space--the microscopic voids within rocks that are unoccupied by solid material. Naturally, this raises the question of who owns the subsurface pore space; in the United States, geologic carbon storage projects must first obtain permission from the relevant property owners in order to utilize the pore space for the storage of injected C[O.sub.2]. In this Article, we endeavor to answer the question of pore space ownership from a novel, important, but essentially overlooked perspective--one which takes into account the implications of the Stock-Raising Homestead Act of 1916 (SRHA) (15) and its capacious mineral reservation for the ownership of pore space.

   In evaluating the issue of pore space ownership, scholars and regulators have focused primarily on the question of who owns the pore space when the mineral estate has been severed from the surface estate. (16) This approach, however, overlooks the critical fact that for the approximately 70 million acres of land patented under the SRHA, (17) the United States federal government held the original fee simple absolute, and conveyed the land while retaining "all the coal and other minerals in the lands." (18) In Watt v. Western Nuclear, Inc., (19) the Supreme Court delineated a four-part test for determining if something falls within the scope of the SRHA's mineral reservation (20)--a test that was further explicated by the Court's decision in BedRoc Limited, LLC v. United States (BedRoc). (21) This Article analyzes this jurisprudence vis-a-vis the question of whether or not pore space falls within the scope of the SRHA's mineral reservation. Based on a detailed analysis of the history of the SRHA and relevant jurisprudence by the Supreme Court and other federal and state courts, we conclude that the federal government likely owns the pore space for those lands patented under the SRHA.

   This conclusion has far-reaching policy implications. For instance, states that have statutorily determined that ownership of the pore space is vested in the surface owner are now confronted by the prospect that these statutes are preempted by federal law when dealing with land originally conveyed by the SRHA. (22) Moreover, given the significant acreage covered by the SRHA, federal ownership of pore space could arguably reduce the transaction costs associated with project development, thereby facilitating the rapid scaling of commercial geologic carbon storage projects. (23)

   This Article proceeds in four parts. Part II describes the historical origins of the SRHA, focusing on the Congressional intent underlying the statute. Part III provides an analysis of Supreme Court and other federal and state case law interpreting the mineral reservation of the SRHA. In Part IV, we raise a number of straw arguments against the notion that pore space can legitimately be considered within the ambit of the SRHA's mineral reservation. We then consider these straw arguments in the context of the jurisprudence covered in Part III. We apply that jurisprudence to the concept of pore space and assess the extent to which the straw argument prevails. Finding that pore space is indeed likely within the scope of the SRHA's mineral reservation, Part V offers a brief, preliminary assessment of the implications of this finding for federal and state policy, as well as the development of CCS projects.

2. HISTORICAL ORIGINS OF THE STOCK-RAISING HOMESTEAD ACT OF 19 16

   In order to encourage settlement and development of the West in the second half of the nineteenth century, the United States federal government embarked on a mission to convey vast amounts of public land to homesteaders. (24) Congress provided aspiring settlers with land in fee simple absolute--free of charge--so long as the land was entered and cultivated for a particular number of years. (25) Settlement proceeded at a rapid rate, and by 1900 the government had allocated nearly 80 million acres of public land to private hands. (26)

   To carry out its goal of settling the West, Congress employed a binary classification system that categorized tracts of land as either mineral or nonmineral. (27) Under this system, tracts were assigned to one category or the other--never both--based on entrymen affidavits asserting the land to be either mineral or nonmineral in character.2s The federal government retained ownership of mineral lands and encouraged miners to exploit their underlying minerals (29)--subject to congressional mining laws. (30) Lands classified as nonmineral were conveyed to private homesteaders for the exclusive purposes of farming and raising livestock. (31)

   In theory, this land classification system was supposed to function as an efficient mechanism for determining each tract's intrinsic purpose--farming or mineral exploitation--as evidenced by its mineral or nonmineral characteristics. (32) In practice, however, the system proved highly amenable to fraud. (33) Because the entryman affidavit was the exclusive means by which tracts were classified, entrymen would often falsely misclassify land as nonmineral in order to receive title from the government to the entirety of the estate, only to be pleasantly "surprised" when minerals were subsequently discovered on the land. (34) All the more troubling was that, in the classification phase, the government struggled to determine whether a given tract of land was more valuable for its minerals or for its agricultural use. (35) Lands misclassified as nonmineral in this context generally remained undeveloped, even when they did...