Client Alert: Texas Supreme Court Sets Low Bar for Pipeline Common Carriers

In Denbury Green Pipeline–Texas, LLC v. Texas Rice Land Partners, Ltd., 15-0225, 2017 WL 65470 (Tex. Jan. 6, 2017), the Texas Supreme Court held that Denbury, a pipeline company, met its burden to demonstrate “common carrier” status, thereby establishing eminent domain authority.  In so doing, the court demonstrated that its prior holding in a related case—Texas Rice Land Partners, Ltd. v. Denbury Green Pipeline-Texas, LLC, 363 S.W.3d 192, 194 (Tex. 2012)—should not be taken as a stringent restriction on Texas pipeline companies’ rights to utilize the power of eminent domain. Indeed, the newly stated “reasonable probability” of public-use test appears to set a low bar for companies seeking to use the power of eminent domain for pipeline construction.