Marion Energy, Inc. v. KFJ Ranch P'shipAnnotate this Case
Appellants Marion Energy (Marion) and the State of Utah School and Institutional Trust Lands Administration (the Trust) leased and owned oil and gas deposits that lay underneath property owned by the KFJ Ranch Partnership (KFJ). To build a road to access their deposits, Marion and the Trust sought to condemn a portion of KFJ's land. To do so, they relied on a statute that permits the exercise of eminent domain for the construction of roads to facilitate the working of "mineral deposits." At issue was whether the phrase "mineral deposits" as used in the statute was intended by the legislature to encompass oil and gas deposits. The district court granted KFJ's motion to dismiss, concluding that the statute did not provide authority to take land for roads to access oil and gas deposits. On appeal, the Supreme Court affirmed, holding (1) the statute is ambiguous as to whether "mineral deposits" includes oil and gas, and (2) because the Court strictly construes an ambiguous statute purporting to grant the power of eminent domain against the condemning party, Marion and the Trust were not authorized by the statute to condemn KFJ's land.