Subsurface Property Rights

When we talk about property rights to land, we usually think about the ownership of the surface of the land. When talking about subsurface property rights in Alberta it is important to understand common law. At common law, ownership of the surface extends to the airspace above and to the subsurface below. Ownership of land even includes the mines and minerals beneath the land with the exception of gold, silver, and any other resource reserved by the Crown. Any interest held by the landowner may be sold. For example, an owner may choose to retain the surface and subsurface, but sell or lease any or all of the minerals.

Early grants from the Dominion to the settlers of what is now Alberta included the mines and minerals. But once the nature and value of the resources underlying Alberta’s fields and forests (especially, coal, oil, and gas) became understood, new grants began to except or reserve some or all of the mineral rights. The same became true for grants of land made by the Hudson’s Bay Company and the Railway companies, who had acquired extensive land holdings from the government. For example, between 1904 and 1912, the Canadian Pacific Railway (CPR) reserved “coal” or “coal and petroleum” or “coal, petroleum and other valuable stone”, before finally reserving all mines and minerals in the transfer of its lands. The unique distribution of mines and minerals rights in Alberta today, reflects these early grants and reservations. Today, the provincial government owns the vast majority (approximately 81 percent) of the mines and minerals in Alberta. Approximately 9% are held by the federal government, mainly in national parks and on Aboriginal lands and military reserves. The remaining 10% of mines and minerals are held under private “freehold” ownership.

The distribution of subsurface resources in Alberta required the courts to develop a common law framework for resolving disputes over the ownership of mines and minerals. Many such disputes are still resolved by the courts this way, case by case. In addition, the legislature has played an important role in defining and clarifying mineral rights and regulating access to the surface by subsurface resource owners. The property rights of Alberta landowners above and below the surface are defined and redefined by legislation and the rulings of the courts as these continue to evolve.

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