Mikkelson Land, LLLP v. Continental Resources, Inc.

United States Court of Appeals
For the Eighth Circuit
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No. 23-2628
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Mikkelson Land, LLLP
Plaintiff - Appellant
v.
Continental Resources, Inc.
Defendant - Appellee
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Appeal from United States District Court
for the District of North Dakota - Western
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Submitted: March 13, 2024
Filed: July 23, 2024
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Before GRUENDER, SHEPHERD, and GRASZ, Circuit Judges.
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SHEPHERD, Circuit Judge.
This appeal concerns the interpretation of a Surface Use Agreement (SUA)
executed between Mikkelson Land, LLLP, and Continental Resources, Inc., which
governed Continental’s use of Mikkelson’s land for its oil and gas operations. The
parties dispute whether the SUA gave Continental the authority to lay water pipeline
across the area governed by the agreement, and Mikkelson filed this action, alleging
multiple claims of breach of contract, trespass, and seeking injunctive relief. The

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district court,1 considering competing motions for summary judgment on some of
the claims, granted summary judgment in favor of Continental, holding that the SUA
was unambiguous and explicitly authorized Continental to install water pipelines.
The parties reached a settlement on the remaining claims and stipulated to their
dismissal, preserving Mikkelson’s right to appeal the adverse grant of summary
judgment. Mikkelson now appeals. Having jurisdiction under 28 U.S.C. § 1291, we
affirm.
I.
As part of its large-scale oil and gas operations in North Dakota, Continental
secured the mineral rights to several tracts of land within McKenzie County. To
facilitate its operations as to these mineral estates, Continental entered into SUAs
with the various landowners who owned the surface estates subject to the mineral
estates, including Mikkelson. These SUAs detailed Continental’s rights and
responsibilities with respect to its use of the surface estates and provided the manner
by which Continental would compensate the landowners. In 2012, Mikkelson and
Continental executed an SUA regarding the tract of property that forms the basis of
this dispute, detailing the agreement between the parties and allowing Continental
to enter upon and make use of the surface estate in furtherance of its operations.
Specifically, through the SUA, Mikkelson granted Continental the right “to go upon
and across the Property as [Continental] may reasonably require for well locations,
roads and associated facilities, related to its Operations.” In addition to the broad
grant of an easement, the SUA includes a compensation provision, providing the
parameters by which Continental is to pay Mikkelson “[a]s compensation and
damages for [Continental’s] use of any of the Property under the Leases and for its
Operations.” As it relates to the installation of pipelines on the surface estate, the
SUA provides:
1 The Honorable Daniel M. Traynor, United States District Judge for the
District of North Dakota.

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[3](b) Damage Payments for Pipelines.
(1) For each pipeline installed on the Property and related to the
Drillsites, Operator shall pay Owner the sum of $75.00 per rod.
(i) Gas Pipelines. Operator shall pay Owner a lump sum of
Ninety Three Thousand One Hundred Fifty and NO/100
Dollars ($93,150.00), or $75.00 per rod for 1,242 rods of right
of way containing pipeline(s) for gas (regardless of whether
any such pipelines are characterized as gathering lines,
transmission lines, or flow lines), and/or power line(s); any
such gas pipeline must be installed below ground, but any
such power line may be installed above or below ground.
Such compensation shall include the rights for Operator
Group: (a) from time to time and at any time or times, to lay,
construct, operate, inspect, maintain, repair, replace with
same or different size pipe, remove, or abandon in place such
pipeline(s) and/or power line(s) within the right of way
granted; (b) to construct from time to time and at any time or
times additional pipelines, appurtenances, valves, metering
equipment, cathodic protection, wires, conduits, cables,
and/or power lines and other facilities needed for Operator’s
Operations within the right of way granted; and (c) from time
to time and at any time or times, to construct, improve,
operate, use, inspect, maintain, and repair all facilities within
the right of way granted.
(ii) Oil Pipelines. Operator shall pay Owner a lump sum of
Ninety Nine Thousand Three Hundred Ninety Nine and
75/100 Dollars ($99,399.75), or $75.00 per rod for 1,325.33
rods of right of way containing pipeline(s) for oil (regardless
of whether any such pipelines are characterized as gathering
lines, transmission lines, or flow lines), and/or power line(s);
any such oil pipeline must be installed below ground, but any
such power line may be installed above or below ground.
Such compensation shall include the rights for Operator
Group: (a) from time to time and at any time or times, to lay,

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construct, operate, inspect, maintain, repair, replace with
same or different size pipe, remove, or abandon in place such
pipeline(s) and/or power line(s) within the right of way
granted; (b) to construct from time to time and at any time or
times additional pipelines, appurtenances, valves, metering
equipment, cathodic protection, wires, conduits, cables,
and/or power lines and other facilities needed for Operator’s
Operations within the right of way granted; and (c) from time
to time and at any time or times, to construct, improve,
operate, use, inspect, maintain, and repair all facilities within
the right of way granted.
(iii) Salt Water, Fresh Water, and Air Pipelines. Operator shall
pay Owner $75.00 per rod for any additional, future right of
way containing pipeline(s) for salt water, fresh water, air,
and/or power line(s); any such salt water, fresh water, or air
pipeline must be installed below ground, but any such power
line may be installed above or below ground. Such
compensation shall include the rights for Operator Group:
(a) from time to time and at any time or times, to lay,
construct, operate, inspect, maintain, repair, replace with
same or different size pipe, remove, or abandon in place such
pipeline(s) and/or power line(s) within the right of way
granted; (b) to construct from time to time and at any time or
times additional pipelines, appurtenances, valves, metering
equipment, cathodic protection, wires, conduits, cables,
and/or power lines and other facilities needed for Operator’s
Operations within the right of way granted; and (c) from time
to time and at any time or times, to construct, improve,
operate, use, inspect, maintain, and repair all Facilities within
the right of way granted.
. . . .

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(2)The easements set forth in this Agreement are for those pipelines
proposed and mapped in the attached Exhibit C (Red Mike Ranch
Plan Map) only.
Exhibit C to the SUA is a plan map of the property marked with proposed pipelines.
In 2015, the parties executed an addendum to the SUA by which Mikkelson
granted Continental expanded rights in exchange for $100,000. As relevant here,
the addendum states:
WHEREAS, Owner and Operator desire to amend the
Agreement to expand the rights granted to Operator and stipulate and
agree to the additional compensation to be paid to Owner for such
expanded rights granted to Operator.
NOW, THEREFORE, in consideration of the foregoing recitals and
terms, covenants and conditions herein, Owner and Operator hereby
agree as follows:
1. Owner grants to Operator Group easements and rights of way for
ingress and egress on, over, above, below, and across the
Property and use of the surface and subsurface of the Property
for any and all operations, which, in the sole and exclusive
discretion of Operator, are deemed necessary; such easements
and rights of way include but are not limited to easements and
rights of way for Operator Group’s drilling, completion, and
production operations on the Property related to the construction,
installation, operation, inspection, maintenance, repair, and
replacement of an additional well pad consisting of four (4)
additional wells (the Florida Federal 8-11H, Florida Federal 9-
11H1, Alpha 8-14H1, and Alpha 9-14H wells) and any
associated facilities deemed necessary by Operator, including
but not limited to compressor stations, meter sites, battery sites,
roads, reserve pits and other facilities for the disposal of waste or
byproducts, tanks and storage facilities, treaters, separators,
deyhydrators, pipelines and power lines.

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In 2018, Continental began installing a water pipeline system, known as the
Boulder Gathering System. The Boulder Gathering System is a series of pipelines
that aids Continental’s operations by carrying freshwater, which is used in hydraulic
fracturing to increase oil production, and saltwater, which is a byproduct of drilling
operations, to and from individual wells on a drill site. Continental notified
Mikkelson that it would be entering Mikkelson’s land to install pipelines for the
Boulder Gathering System and that Mikkelson would be compensated pursuant to
the terms of the SUA. Mikkelson objected, stating that the SUA’s plan map did not
include these pipelines and that the SUA provisions related to damages for Salt
Water, Fresh Water, and Air Pipelines were inapplicable. Continental responded
that the SUA authorized the installation of water pipelines and stated that it would
move forward with the project. Continental completed construction of the Boulder
Gathering System in June 2019. Continental remitted four separate payments to
Mikkelson for the pipelines: $27,649.50 in September 2018, $45,987.75 in October
2018, $90,023.25 in May 2019, and $3,600.75 in April 2020. Mikkelson did not
accept any of these payments.
Instead, Mikkelson initiated this action in March 2020, alleging eight claims
against Continental: (1) breach of contract for installation of excess pipelines;
(2) trespass for installation of pipelines; (3) breach of contract for failure to
compensate for roads and well sites; (4) breach of contract for failure to reclaim; (5)
breach of contract for failure to consult; (6) breach of contract for failure to make
reasonable efforts; (7) breach of contract for failure to install access gates; and (8) a
claim for injunctive relief. The parties filed competing summary judgment motions
with respect to the breach of contract and trespass claims related to the installation
of pipelines and the claim for injunctive relief. The district court denied Mikkelson’s
motion and granted Continental’s motion. As to the breach of contract claim, the
district court determined that the SUA explicitly “gave Continental the authority to
install [water pipelines] in the future and set out a payment calculation if that were
to happen,” concluding that “the SUA speaks for itself and no ambiguity in its
meaning exists.” The district court noted that other provisions of the SUA discussed
circumstances where Continental would be required to obtain prior consent from

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Mikkelson, including, for example, the drilling of water wells, and that no such
limitation appeared in regards to the installation of water pipelines. The district court
also considered the addendum and its stated purpose of expanding the rights that
Mikkelson granted to Continental, finding that the addendum specifically granted
Continental easements and rights of way “for any and all operations, which, in the
sole and exclusive discretion of [Continental,] are deemed necessary.” The district
court also rejected Mikkelson’s argument that the pipelines were impermissible
because they were not laid out in the plan map, noting that North Dakota law does
not require the description of an exact location of an easement. Finally, the district
court concluded that, even if the SUA did not authorize the installation of the
pipelines, Continental still had authority to install them pursuant to North Dakota
law and relevant leases. The district court further held that Continental’s
authorization to install the water pipelines defeated Mikkelson’s claim for trespass
and rendered its request for injunctive relief moot.
After the district court granted summary judgment on these claims, the parties
settled the remaining claims and stipulated their dismissal. Mikkelson preserved the
right to appeal the adverse grant of summary judgment, which it now does, arguing
that the district court erroneously determined that the SUA authorized Continental
to install the water pipelines.2
II.
Mikkelson asserts that the district court erred because the SUA and addendum
unambiguously limit Continental to the installation of certain oil and gas pipelines
2 Mikkelson states that it “does not appeal the District Court’s finding that
Continental has authority to install the Boulder Gathering System ‘through other
legal means, including by leases, unitization orders, and its status as a mineral lease
holder under North Dakota law.’” Mikkelson nonetheless states that the Court must
still decide the issue of whether the SUA allows installation of the pipelines because,
if the Court were to rule in Mikkelson’s favor, on remand it would be entitled to
argue for compensation that differs from that provided by the SUA.

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that were specifically referenced in the SUA. In the alternative, Mikkelson asserts
that the SUA and addendum are ambiguous, and extrinsic evidence is necessary to
determine the parties’ intent. “‘We review de novo a district court’s grant of
summary judgment.’ Summary judgment is proper only if ‘there is no genuine issue
as to any material fact’ and ‘the moving party is entitled to judgment as a matter of
law.’” Avenoso v. Reliance Standard Life Ins. Co., 19 F.4th 1020, 1024 (8th Cir.
2021) (citations omitted).
Under North Dakota law, which applies to this diversity action, “[t]he
interpretation of a written contract generally is a question of law for the court,
making summary judgment an appropriate method of disposition in contract
disputes.” Burk v. State ex rel. Bd. of Univ. & Sch. Lands, 890 N.W.2d 535, 539
(N.D. 2017). In conducting contract interpretation, “the language of a contract
governs its interpretation if the language is clear and unambiguous.” In re Racing
Servs., Inc., 744 F.3d 543, 549 (8th Cir. 2014) (applying North Dakota law). “A
contract is ambiguous when rational arguments can be made for different positions
about its meaning . . . . When a contract is ambiguous, the terms of the contract and
the parties’ intent becomes a question of fact.” Gap, Inc. v. GK Dev., Inc., 843 F.3d
744, 748 (8th Cir. 2016) (alteration in original) (citation omitted). Further, “courts
are to interpret the contract as a whole to give effect to all of its provisions,
and . . . the words of a contract are to be given their ordinary meaning, absent the
parties’ use of the words in a technical sense.” In re Racing Servs., Inc., 744 F.3d at
549 (citation omitted). Finally, “[w]hen a contract is reduced to writing, the
intention of the parties is to be ascertained from the writing alone if possible.” Id.
(alteration in original) (citation omitted).
We agree with the district court that the language of the SUA is clear and
unambiguous and grants Continental the right to install the water pipelines.
Paragraph 3(b)(1)(iii) specifically contemplates the installation of “any additional,
future right of way containing pipeline(s) for salt water [or] fresh water,” and
provides the payment structure for any of these future pipelines. It does not contain
any limitations on the location of any future or additional water pipeline, nor any

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indication that installation of a water pipeline that was not contemplated at the
execution of the SUA is impermissible. This provision is subject to only one rational
reading, making it unambiguous. See Gap, Inc., 843 F.3d at 748. While we conclude
that this language alone is unambiguous, our interpretation of the SUA is bolstered
by the language of the addendum which specifically contemplates expanding
Continental’s rights under the SUA by granting Continental easements “for any and
all operations, which, in the sole and exclusive discretion of [Continental,] are
deemed necessary.” Reading the SUA and the addendum together, Continental may
install additional or future water pipelines on the property and has an easement for
those purposes.
Mikkelson asserts that the SUA does not grant Continental the authority to
install water pipelines because it expressly limited all pipelines to those that were
contained in the plan map. However, Mikkelson’s proposed construction would
impermissibly render some terms of the SUA and addendum meaningless: If the
SUA were read to mean that no pipelines could be installed other than those included
in the plan map, there would be no need for the SUA to detail the manner of
compensation for “any additional, future right of way containing pipeline(s) for salt
water [or] fresh water.” Mindful that North Dakota law requires that “[e]ach term
of a contract is construed to avoid rendering other terms meaningless,” Schwarz v.
Gierke, 788 N.W.2d 302, 308 (N.D. 2010), we reject Mikkelson’s contention.
Mikkelson also asserts that adopting Continental’s proposed construction of
the SUA creates a conflict between the provision stating that the “easements set forth
in this Agreement are for those pipelines proposed and mapped in the attached
Exhibit C only,” and Paragraph 3(b)(1)(iii), which provides the authority to install
water pipelines. Mikkelson further argues that the language in the addendum which
broadly expands Continental’s rights under the SUA must yield to the specific
provision stating that all pipelines are depicted in Exhibit C. Although we
acknowledge that, under North Dakota law, “[i]f a conflict exists between a specific
provision and a general provision in a contract, the specific provision qualifies the
general provision,” Rolla v. Tank, 837 N.W.2d 907, 910 (N.D. 2013) (alteration in

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original), we perceive no conflict between the terms of the SUA or the SUA and the
addendum. Construing the contract “as a whole to give effect to all of its
provisions,” In re Racing Servs., Inc., 744 F.3d at 549, we read this provision to
simply mean that Exhibit C depicted the oil and gas pipelines that were contemplated
at the time the SUA was executed, with Paragraph 3(b)(1)(iii) leaving open the
possible installation of future water pipelines not then contemplated. And the
addendum broadly granted Continental easements and rights of way to carry out this
aim. Stated otherwise, water pipelines to which Mikkelson objects were not
included in Exhibit C because they were not contemplated at the time the SUA was
executed, and, per the terms of the SUA, they did not need to be; the SUA
contemplated “future” pipelines. Because there is no conflict between the provisions
of the SUA and the SUA and addendum, Mikkelson’s argument fails.
Given the foregoing, we conclude that the district court properly interpreted
the SUA and addendum to authorize Continental’s installation of water pipelines and
did not err in granting summary judgment to Continental on this basis. Thus, we
need not reach Mikkelson’s alternative argument.
III.
For the foregoing reasons, we affirm the judgment of the district court.
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