What was the holding in the Coastal Oil and Gas Corp vs. Garza Energy Trust case?

In the Coastal Oil and Gas Corp. v. Garza Energy Trust case, the court upheld the fundamental principle known as the rule of capture. This legal doctrine allows a landowner to extract minerals beneath their land, such as oil and gas, even if that extraction results in draining resources from neighboring properties. The court ruled that Coastal Oil's drilling activities, which extended laterally beneath Garza's property, were not considered trespassing because they were operating within the confines of this rule.

This ruling reaffirmed the rights of landowners to capture and extract resources without direct interference from the actions of adjacent landowners, provided that such activities do not involve physical invasion of the property. The significance of the decision lies in its impact on the oil and gas industry, indicating that as long as the extraction is done lawfully and without physical trespass, companies are generally protected under the rule of capture.