Pipeline Eminent Domain & Condemnation

Contact the State Bar of Texas attorney referral service at 1-800-252-9690 or visit the State Bar website.

The Railroad Commission (RRC) is limited in its authority to those powers delegated by the Legislature by statutory enactments. Regarding pipelines, the Railroad Commission has authority over intrastate pipelines (those that originate and end within the State of Texas) for pipeline safety and pipeline rate regulation.

In Texas, pipelines are not required to be permitted before being built. There is no statutory or regulatory requirement that a pipeline operator seek or receive from the Railroad Commission either a determination that there is a need for the pipeline capacity or prior approval to construct a pipeline and related facilities. Additionally, the Railroad Commission does not determine or confer common carrier status for pipelines. The pipeline operator reports to the Railroad Commission the status of a pipeline as a gas utility, common carrier or private line. Commission does not have any authority over a common carrier pipeline's exercise of its statutory right of eminent domain.

Generally, the Railroad Commission has no authority over the routing or siting of intrastate or interstate pipelines. The pipeline route is determined by the pipeline’s owner/operator. The exception to this is when the pipeline contains “sour gas” (hydrogen sulfide) because of its potential toxicity at certain levels.

The Railroad Commission also has no pipeline safety authority or rate regulation authority over interstate pipelines (pipelines that cross state boundaries), such as the TransCanada Keystone (Gulf Coast) pipeline. Safety regulation of interstate pipelines is the responsibility of the US Dept. of Transportation Pipeline and Hazardous Materials Safety Administration (PHMSA), not the Railroad Commission.

A pipeline operator or construction company is required to notify the Railroad Commission's Pipeline Safety Department before beginning construction on a pipeline when the construction involves an intrastate pipeline longer than one mile. Commission rules require the operator to file a pre-construction report at least 30 days prior to beginning construction. Some operators report construction plans much earlier than 30 days prior to initiating construction activities. However, new construction on natural gas or LP-gas distribution or master meter systems of less than five miles is exempted from this reporting requirement. Click here to obtain a copy of a new construction report from the Commission’s website.

No. Eminent domain is a private property rights issue, set by statute in state law by the Texas Legislature.

State law enacted by the Texas Legislature, not the Railroad Commission, governs whether pipeline companies are entitled to exercise eminent domain authority. Numerous state law provisions deal with eminent domain rights and property rights. The Railroad Commission does not have jurisdiction to administer or enforce any of these eminent domain and property rights laws.

A T-4 Permit is a permit to operate a pipeline in Texas; it is not a determination of whether a pipeline is or is not a common carrier. A T-4 Permit is essentially a registration process to provide the Railroad Commission (RRC) with information about a pipeline, such as the material it is carrying and whether the pipeline is jurisdictional to the RRC. There is no hearing at the Railroad Commission for T-4 Permits.

An application for a T-4 Permit must be filed by an operator with an approved P-5 Organization Report on file with the Commission, and must include a digitized map of the pipeline(s) to be covered by that T-4 Permit. A P-5 Organization Report and financial security (bond, letter of credit, cash deposit, or, for wells, a well-specific plugging insurance policy) are required of all companies performing operations within the jurisdiction of the Commission, including pipeline companies.

Common carriers are not the only pipelines required to have a T-4 Permit. Common carriers, gas utilities and private lines must have a T-4 Permit, with two exceptions. Pipelines that never leave an oil or gas production lease (production and flow lines) and distribution lines that are part of a natural gas or LP-gas distribution system are not required to have a T-4 Permit.

The T-4 Permit collects a variety of information including: who is operating the pipeline; what is being transported in the pipeline; where the pipeline is located (the counties, mileage, offshore or onshore); how the pipeline will be operated (gas utility, common carrier or private line); and the pipeline’s physical characteristics (diameter, wall thickness, pipe grade and operating pressure).

Information provided by the pipeline companies in the T-4 Permit identifies pipelines as common carriers, gas utilities or private lines to ensure that all pipelines, including common carriers, comply with RRC's regulations over pipeline safety and rate regulation. For interstate pipelines, a T-4 Permit allows the Commission to know what entity operates the pipeline and to determine whether the pipeline is jurisdictional to the Railroad Commission. Companies that identify themselves to the Railroad Commission as intrastate crude oil common carriers on the T-4 Permit must file tariffs or rate schedules with the Commission on what they are charging to transport that commodity in their pipelines. In the case of intrastate common carriers, the T-4 Permit ensures common carriers comply with RRC’s regulations over pipeline safety and rate regulation. The status indicated on the T-4 Permit stands unless challenged in court, and the ultimate authority to make the determination of which pipelines qualify for common carrier status is with the courts.

The Supreme Court opinion in Texas Rice Partners, Ltd. v. Denbury Green Pipeline, 363 S.W.3d 192 (Tex. 2012) accurately described the Commission's T-4 Permit process as one of registration, not of application, and that in accepting an entity's paperwork, the Commission performs a clerical rather than judicial-type act. The Court held that the T-4 Permit granted to Denbury by the Commission, standing alone, did not conclusively establish Denbury’s status as a common carrier and confer the power of eminent domain. Further, the Court stated, "the parties point to no regulation or enabling legislation directing the Commission to investigate and determine whether a pipeline will in fact serve the public." 

Generally speaking, common carrier pipelines in Texas have a statutory right of eminent domain. Common carrier pipelines are those that transport oil, oil products, gas, carbon dioxide, salt brine, sand, clay, liquefied minerals or other mineral solutions. For example, a pipeline transporting crude oil could be a common carrier, and, as such, would have the right of eminent domain. A ‘common carrier’ pipeline transporting natural gas for others is a ‘public utility,’ commonly referred to as a ‘gas utility,’ and also would have the power of eminent domain. The Railroad Commission has neither the power to determine which pipelines are common carriers or gas utilities, nor does it have the authority to regulate any pipelines with respect to the exercise of their eminent domain powers.

The Railroad Commission can inform you as to the reported status of a pipeline as either a gas utility or a common carrier, both of which have a statutory right of eminent domain. For information on natural gas pipelines, call the Railroad Commission’s Gas Utility Audit Section at (512) 463-7022. For information on other pipelines, call the Commission’s Pipeline Safety Department at (512) 463-7058.

Yes. If your land has been condemned for a pipeline easement, the Commission would like to be informed, since there is no requirement for the operators to notify the Commission. This will help ensure that the operator is properly classified as either a gas utility or a common carrier, depending upon the commodity being transported. Please notify the Gas Utility Audit Section at (512) 463-7022.

Operator names and information can be located using the “Organization Operator Query Criteria” on the commission website:

http://webapps2.rrc.texas.gov/EWA/organizationQueryAction.do;jsessionid=Mj0qaBJUC6nbAVgTtYnMTKF_aNUX2H_Rwm4wPvv4SYLnGQK8B1ZV!-1240030253

There is no standard width; usually, the width of an easement is set forth in the contract or the condemnation judgment.

Generally, pipelines must be buried a minimum of 36 inches (three feet). However, pipeline operators are not required to maintain this depth if erosion occurs after the pipeline’s installation.

For gas pipelines, there is no minimum setback requirement. Hazardous liquids pipelines that are within 50 feet of a structure must be buried to a depth of 48 inches (four feet), which is 12 inches more than the standard 36 inches (three feet) such pipelines must be buried when built. Examples of hazardous liquids pipelines are those transporting crude oil or a refined product, such as gasoline.