Gravel2Gavel Construction & Real Estate Law Blog
In a closely watched opinion issued on May 16, 2025, the Texas Supreme Court in Myers-Woodward, LLC v. Undergrounds Services Markham, LLC, — S.W.3d —, No. 22-0878, 2025 WL 1415892 (Tex. May 16, 2025) resolved a long-uncertain issue of subsurface property rights in the context of salt dome mining. The Court held that, unless a deed provides otherwise, subsurface voids created by salt mining operations are owned by the surface estate holder, not the mineral interest holder. By rejecting a salt-specific rule, the Court harmonized ownership principles across subsurface formations, applying a uniform rule regardless of the type of mineral removed.
The ruling is significant for developers of underground storage in Texas, including those involved in carbon capture, utilization and storage (CCUS), as it brings long-awaited clarity to the ownership of post-extraction cavern space.
Background: Salt Caverns and Subsurface Rights
The case involved a 160-acre tract in Matagorda County, where the mineral estate had been severed in 1947 and later conveyed to Underground Services Markham, LLC (USM). USM conducted solution-mining operations to extract salt, leaving behind large underground caverns—precisely the kind of formations now sought after for hydrocarbon or CO₂ storage.
USM claimed ownership and usage rights over these caverns, asserting that as the mineral owner and creator of the caverns, it could store hydrocarbons produced offsite or lease storage rights to third parties. The surface owner, Myers-Woodward, LLC, disagreed, asserting that USM’s rights were limited to salt production and did not extend to the use of resulting voids for unrelated storage. The Court agreed with the surface owner.
The Court’s Ruling: “Empty Space Is Not Salt”
Writing for the Court, Chief Justice Blacklock reinforced a principle familiar from oil and gas jurisprudence: While the mineral estate includes the right to develop minerals and use the surface reasonably necessary to do so, it does not carry with it ownership of the geological voids left behind.
The Court explained that while USM had acquired the rights to the salt itself, it had not acquired the salt formations, much less the cavern space within them. “[E]mpty space is not a mineral, no matter how economically valuable it becomes,” the Court concluded, and therefore not part of the mineral grant. In doing so, it expressly overruled the minority view expressed in Mapco, Inc. v. Carter, 808 S.W.2d 262 (Tex. App.—Beaumont 1991, writ granted), rev’d on other grounds, 817 S.W.2d 686 (Tex. 1991), which had long contributed to legal ambiguity surrounding pore space ownership. (See Robert A. James et al., “Carbon Sequestration: So You Think You Own the Void Space and Other Legal Issues,” Proceedings of the 60th Annual Institute on Oil & Gas Law (Institute for Energy Law (CAIL), 2009).
Although the mineral estate is dominant under Texas law—allowing the mineral owner to make reasonable use of the surface and, to the extent retained by the surface estate, the subsurface for development—that right is not absolute. Coyote Lake Ranch, LLC v. City of Lubbock, 498 S.W.3d 53, 60 (Tex. 2016). Mineral estate dominance does not permit burdens unrelated to mineral development on the subject tract. The Court found that storing hydrocarbons—especially those produced elsewhere—did not qualify as a “reasonably necessary” use for salt production and, in fact, would likely impede it.
Broader Implications Than Salt: The Court’s Preference for a Bright-Line Rule
Although the dispute arose in the context of salt mining, the Court’s reasoning reaches well beyond it. USM had urged the Court to draw a distinction between solid minerals like salt and migratory minerals like oil and gas, arguing that voids created by extracting each should be treated differently. The Court declined to do so. Instead, it endorsed a uniform rule: Subsurface cavern space created by the removal of minerals—any minerals—remains part of the surface estate unless expressly conveyed.
Royalty Calculation Reversal
In a secondary but important ruling, the Court also reversed the lower courts on the method for calculating salt royalties. The Court found that the 1947 correction deed created an in-kind royalty, meaning the royalty owner is entitled to a share of the actual minerals produced or proceeds from their sale (in this case, 1/8 of the salt produced), not just a valuation based on market value. The Court’s interpretation treats royalties on “oil, gas, or other minerals” equally, rejecting the idea that salt should be treated differently than oil or gas in deed construction. The case was remanded for a recalculation of the royalty owed based on net proceeds of actual salt sales, rather than fixed-price comparables. This could significantly increase the royalty payment and serves as a warning to operators relying on fixed-price benchmark
Implications for Carbon Capture and Subsurface Storage
This ruling has implications for emerging technologies reliant on underground formations, such as CO₂ sequestration. With its abundant underground formations and their vast potential storage capacity—estimated between 661 million and 2.4 billion tons—Texas is a prime location for CCUS. However, uncertainty over subsurface ownership has hindered project development. The Myers-Woodward decision confirms that, absent express language to the contrary, the surface estate owns the cavern space left by mining operations. This means that companies planning to repurpose these voids for CO₂ storage must negotiate directly with surface owners—whether by easement, lease or surface use agreement—to secure storage rights.
Moving Forward
As CCUS continues to gain traction, the Myers-Woodward opinion reinforces the need for early and deliberate legal diligence. Developers must carefully review legacy mineral and surface deeds, confirm ownership of storage formations, and anticipate the need for multi-party agreements in any severed estate scenario. The ruling also serves as a cautionary signal to operators relying on outdated or ambiguous royalty clauses. Absent express language providing otherwise, royalty clauses may entitle the grantor to a share of actual production or sale proceeds—not a discounted or benchmarked value
In Texas, at least, the rule is now clear: If you want the empty space, you’ll need to talk to the surface owner.