American Oil and Gas Reporter - September 2022 - 27

solar development as well. The solar industry is accustomed to
working with owners and their tenants to limit disturbance on
and interruptions to existing cattle and crop operations. Not
only will adding solar positively impact annual revenues to the
land, it also helps hedge against fluctuations in commodity
cycles and farm input inflation.
Operational Impacts
The primary consideration of any operator evaluating a solar
project will be how much that project will impact upstream operations.
Fortunately, accommodating exploration and production
is in the solar developer's best interests. To ensure the joint
project helps both parties, the developer must work closely
with oil and gas operators and deeply understand industryspecific
practices on the ground. Disrupting operations will
benefit no one.
The solar industry has become adept at resource planning to
include the executive mineral estate and how that will impact
the viability of the solar facility. By leveraging that expertise,
smart developers can integrate with upstream operations.
When preparing for a project on an oil and gas field, a solar
development partner will design a panel layout that functions
among existing well sites, access roads, gathering lines and
other existing assets. A wise developer will work with the
producer to plan future oil and gas field use, setting aside
multiwell pads for long-term development while creating more
contiguous land for the solar facility.
The land set aside for the solar farm eventually will become
unavailable for other surface uses for a few decades. However,
during the development phase where the solar partner has
leased the land but is securing interconnection with the utility
company, which generally lasts one-five years, the oil and gas
producer can continue using the surface for access, tenant
grazing and other activities that do not negatively or permanently
impact the surface lands.
After interconnection is approved, the project enters an
18-24 month construction phase. During this period, there
will be construction throughout the solar portion of the field.
But aside from a few laydown yards and a temporary increase
in access road traffic, this activity should have little impact
on the field's operations.
Once the energy generation facility is built and brought on
line, a 50-year plus operation phase begins. The facility will
be protected by a security fence and rarely need to be accessed.
The project will produce stable electrical power for decades,
providing the oil and gas producer with annually escalating
rental revenues that can help offset decreases in acreage
value from production declines and counterbalance the land's
holding costs.
At the end of the solar facility's life, the project will be
decommissioned, with any energy generation equipment reclaimed
so the land can be returned to the producer in the
same state as originally granted. During all these phases,
subsurface development can continue unimpeded.
The relationship between operators and solar developers
may be formalized through surface waiver or accommodation
agreements, which allow mineral owners or lessees to waive
their rights of surface accommodation in favor of the proposing
surface tenant, a solar developer. Because the mineral estate is
dominant, the agreement is a permissive document that governs
the future relationship between competing energy facilities.
Broad Opportunity
It is not only upstream operators who can take advantage of
this land-use trend; service and midstream companies who have
excess or under-utilized landholdings also can be excellent
partners for solar developers. Midstream facilities often have
power offtake built out to the site already, and service and
laydown yards may be located near transmission corridors
within their market area.
The utility-scale solar industry functions by finding parcels
of land that have direct access to high voltage transmission
lines. The more acres available, the better, but even a few
hundred acres that can be combined with neighboring properties
can allow midstream and services companies to leverage their
community relationships and bring in additional revenue.
For oil and gas companies of all types, partnering with utility-scale
solar can offer a way to diversify income portfolios,
lower holding tax liability and meet environment, social and
governance goals.
In addition to these economic benefits, it's possible locating
solar development around existing energy infrastructure will
streamline the permitting and rezoning processes, removing
barriers to renewable energy development. Operators whose
assets support both traditional and renewable energy will have
an even stronger story to share with investors and the public.
By collaborating, the oil and gas and solar energy industries
can plan for a bright future, open new avenues for increased
profitability and strengthen the United States' global energy
leadership.
❒
CHRIS NOONAN is a certified professional landman with 15 years of oil and
gas industry experience spanning land and mineral leasing, well development
planning, and water sourcing and transfer. In the renewable energy space,
Noonan's accomplishments include managing a 30,000-acre wind leasing project
and overseeing multistate land acquisition projects for Redeux Energy, a utilityscale
solar and energy storage developer that is seeking oil and gas partnerships.
SEPTEMBER 2022 27
American Oil and Gas Reporter - September 2022

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