FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

WILLISTON BASIN INTERSTATE 

PIPELINE COMPANY,

Plaintiff-Appellant,

v.

AN EXCLUSIVE GAS STORAGE

LEASEHOLD AND EASEMENT IN THE

CLOVERLY SUBTERRANEAN

GEOLOGICAL FORMATION, INCLUDING No. 06-35660

BUT NOT LIMITED TO THE FORMATION D.C. No.

BENEATH SECTION 35, T9S, R23E  CV-06-00010-RFC

CARBON COUNTY, MONTANA, AND OPINION BENEATH SECTION 19, T58N, R99W

PARK COUNTY, WYOMING, AND

CERTAIN OIL OR GAS WELLS

LOCATED THEREIN; HOWELL

PETROLEUM CORPORATION;

ANADARKO PETROLEUM

CORPORATION,

Defendants-Appellees. 

Appeal from the United States District Court

for the District of Montana

Richard F. Cebull, District Judge, Presiding

Argued and Submitted

February 5, 2008—Seattle, Washington

Filed May 9, 2008

Before: Raymond C. Fisher, Ronald M. Gould, and

Sandra S. Ikuta, Circuit Judges.

5153
Opinion by Judge Ikuta

5154 WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE
COUNSEL

Robert T. Hall, III (argued) and Andrea Wolfman, Thelen

Reid Brown Raysman & Steiner LLP, Washington, D.C., for

the plaintiff-appellant. 

Jon Metropoulos and Dana L. Hupp, Gough, Shanahan, Johnson & Waterman, Helena, Montana, for the plaintiffappellant. 

W. Scott Mitchell and Jason S. Ritchie, Holland and Hart

LLP, Billings, Montana, for the defendant-appellee. 

Patrick R. Day (argued), Holland and Hart LLP, Cheyenne,

Wyoming, for the defendant-appellee.

5156 WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE
OPINION

IKUTA, Circuit Judge: 

Williston Basin Interstate Pipeline Company (Williston)

claims that it has lost and is continuing to lose natural gas

stored in its Elk Basin Storage Reservoir due to the operation

of gas production wells owned by Howell Petroleum Corporation and Anadarko Petroleum Corporation (Howell/

Anadarko). Two of those wells are located within the lateral

boundaries of Williston’s storage reservoir, but are completed

in geologic formations (the Morrison and Sundance formations) below the geologic formation in which Williston stores

its natural gas (the Cloverly formation). Williston brought an

action in federal district court, seeking damages and injunctive relief pursuant to its state law claims of conversion and

negligence and also seeking to condemn the two Howell/

Anadarko wells located within the lateral boundaries of the

Elk Basin Storage Reservoir. The district court dismissed

Williston’s action. In this appeal, we consider Williston’s

arguments that the district court erred in dismissing Williston’s complaint for lack of subject matter jurisdiction or for

failure to state a claim under the Natural Gas Act (NGA), 15

U.S.C. §§ 717-717z. Williston contends that the district court

erred in holding that Williston needed authorization from the

Federal Energy Regulatory Commission (FERC) before it

could condemn Howell/Anadarko’s wells, and therefore erred

in dismissing Williston’s condemnation claim. Williston also

contends that its state law claims raised a substantial federal

question because they were aimed at enforcing a duty created

by the NGA. We reject both of Williston’s arguments and

affirm the district court. 

I

Williston is an interstate natural gas pipeline company that

delivers gas to a variety of customers in Montana, North

Dakota, South Dakota and Wyoming. As part of its operaWILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE 5157
tions, Williston stores gas in the Elk Basin Storage Reservoir

within the Elk Basin Field, which is located in southern Montana and northern Wyoming. The Elk Basin Storage Reservoir

is located in an underground geological formation (the

Cloverly formation) from which the producible natural gas

has already been removed. Williston now uses this formation

for storage and withdrawal of its stored natural gas, and has

installed seven active injection/withdrawal wells in the reservoir for this purpose. 

As an interstate natural gas company, Williston is subject

to federal regulation. See 15 U.S.C. § 717(a), (b). The NGA

authorizes FERC to regulate the “transportation of natural

gas” in interstate commerce. See id. § 717(a); 42 U.S.C.

§ 7172(a). Williston’s gas storage facilities are regulated by

FERC “since those facilities are a critical part of the transportation of natural gas and sale for resale in interstate commerce.” Schneidewind v. ANR Pipeline Co., 485 U.S. 293,

308 (1988); see also 18 C.F.R. § 284.1(a) (providing that

“[t]ransportation includes storage”). Under the NGA, a natural gas company must obtain a certificate of public convenience and necessity (CPCN) from FERC before it can

engage in the acquisition, construction, operation or extension

of any facility. 15 U.S.C. § 717f(c)(1)(A). Natural gas companies must operate their facilities in compliance with the terms

and conditions set forth in their CPCN and in FERC regulations. See id. §§ 717(a), 717f(c)(1)(A), 717f(e). 

The Elk Basin Storage Reservoir was previously owned by

Billings Gas Company (Billings). In 1949, FERC issued Billings a CPCN to acquire and use the “Elk Basin Cloverly gas

reservoir” for purposes of underground storage. Billings Gas

Co., 8 F.P.C. 1166, 1166-67 (1949). The CPCN stated that the

reservoir was “more fully described in the application in these

proceedings and exhibits appended thereto.” Id. at 1167.

Montana-Dakota Utilities Co. (Montana-Dakota) then

acquired the reservoir and operated it until 1985, at which

time FERC approved Williston’s application for a CPCN to

5158 WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE
acquire and operate natural gas facilities including the Elk

Basin Storage Reservoir. The CPCN noted again that the

facilities were “more fully described in the application.” Williston Basin Interstate Pipeline Co. & Montana-Dakota Utils.

Co., 30 F.E.R.C. ¶ 61,143, 61,253 (1985). 

Billings, Montana-Dakota, and Williston operated the Elk

Basin Storage Reservoir until 2002 without any notable interference. During this period, Howell Petroleum Corporation

owned leases and mineral interests in oil and gas producing

formations in the Elk Basin Field. Problems began in 2002

when Anadarko Petroleum Corp., a corporation engaged in

natural gas exploration and production, purchased all of Howell’s stock. Soon after the stock purchase, Howell/Anadarko

drilled several wells within the Elk Basin Field, including

wells 19-1 and 195. Well 19-1 was completed in the Sundance formation and well 195 was completed in the Morrison

and Sundance formations. Although the Morrison and Sundance formations are located below the Cloverly formation

where Williston’s natural gas is stored, both wells are located

within the lateral boundaries of the Elk Basin Storage Reservoir and their well bores cross through the Cloverly formation

to reach the lower geologic formations. 

On January 27, 2006, Williston filed a complaint in district

court against Howell/Anadarko, alleging that “[d]efendants

have caused and are causing the loss . . . of Williston’s storage gas.” Williston claimed it conducted an analysis of Elk

Basin Storage Reservoir data which indicated that the loss of

gas in Williston’s storage reservoir was directly correlated to

increased production from Howell/Anadarko’s wells. The

complaint asserted state law conversion and negligence

claims and sought damages and injunctive relief. 

After Howell/Anadarko filed a motion to dismiss for lack

of subject matter and diversity jurisdiction, Williston filed an

amended complaint which added a claim for condemnation

WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE 5159
under Rule 71A of the Federal Rules of Civil Procedure.1

 This

amended complaint sought condemnation of wells 19-1 and

195 under the authority of Williston’s 1985 CPCN. Williston

did not allege that its CPCN specifically described the property Williston sought to condemn, nor did Williston provide

the district court with a copy of the map exhibits which

accompanied its CPCN application, or with any other application materials depicting the lateral and vertical boundaries of

the reservoir approved by FERC in the 1949 or 1985 order.

In the absence of any FERC authorization to condemn the two

wells, Howell/Anardarko argued, among other things, that

Williston’s amended complaint failed to state a condemnation

claim and that the court lacked subject matter jurisdiction

over that claim. On July 14, 2006, the district court granted

Howell/Anadarko’s motion to dismiss Williston’s federal

claims and declined to exercise supplemental jurisdiction over

the state law claims. 

II

We first review Williston’s challenge to the district court’s

dismissal of Williston’s condemnation claim. Because the district court’s order discussed only jurisdictional grounds for

dismissal, it apparently dismissed Williston’s condemnation

claim for lack of subject matter jurisdiction. However, the

parties agree that the district court may have dismissed this

claim for failure to state a claim. Because we can affirm the

district court on any basis supported by the record, see Foster

v. Wilson, 504 F.3d 1046, 1050 (9th Cir. 2007), we will consider both bases for dismissal. 

1At the time Williston filed its amended complaint, Rule 71A of the

Federal Rules of Civil Procedure governed the procedure for the condemnation of real and personal property in federal court. The rule was

amended in 2007, and is now Rule 71.1 of the Federal Rules of Civil Procedure. 

5160 WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE
A

We first consider Williston’s argument that the district

court could not dismiss Williston’s condemnation claim for

lack of subject matter jurisdiction. As a general rule, when

“[t]he question of jurisdiction and the merits of [the] action

are intertwined,” dismissal for lack of subject matter jurisdiction is improper. See Safe Air for Everyone v. Meyer, 373

F.3d 1035, 1039 (9th Cir. 2004). Such an intertwining of

jurisdiction and merits may occur when a party’s right to

recovery rests upon the interpretation of a federal statute that

provides both the basis for the court’s subject matter jurisdiction and the plaintiff’s claim for relief. See id. (citing Sun Valley Gas., Inc. v. Ernst Enters., 711 F.2d 138, 139 (9th Cir.

1983)). As the Court explained in Steel Co. v. Citizens for a

Better Env’t, 523 U.S. 83 (1998), “if ‘the right of the petitioners to recover under their complaint will be sustained if the

Constitution and laws of the United States are given one construction and will be defeated if they are given another,’ ”

then the court has jurisdiction over the dispute, and cannot

dismiss on jurisdictional grounds. Id. at 89 (quoting Bell v.

Hood, 327 U.S. 678, 685 (1946)). There is an exception to

this general rule, however: “a suit may sometimes be dismissed for want of jurisdiction where the alleged claim under

the Constitution or federal statutes clearly appears to be

immaterial and made solely for the purpose of obtaining jurisdiction or where such a claim is wholly insubstantial and frivolous.” Bell, 327 U.S. at 682-83; see also Steel Co., 523 U.S.

at 89. 

[1] Here the district court concluded that it lacked jurisdiction over Williston’s condemnation claim based on the court’s

construction of two provisions of the NGA, 15 U.S.C.

§ 717f(h) and 15 U.S.C. § 717f(c)(1)(A), as read together.2

2

15 U.S.C. § 717f(h) states, in pertinent part: 

When any holder of a certificate of public convenience and

necessity cannot acquire by contract, or is unable to agree with

WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE 5161
Section 717f(h) states that in order to bring a condemnation

claim the natural gas company must have a CPCN and the

acquisition must be “necessary.” See § 717f(h) (permitting a

condemnation action when a holder of a CPCN cannot

acquire “the necessary right-of-way” required for its natural

gas pipe lines, or “the necessary land or other property”

required for pipeline operation facilities). Section 717f(c)(1)(A), in turn, precludes a natural gas company

from acquiring or extending a facility without a CPCN from

FERC “authorizing such acts or operations.” 

[2] According to the district court, in seeking to condemn

wells 19-1 and 195, Williston was undertaking to extend its

facilities. Pursuant to § 717f(c)(1)(A), a natural gas company

may not extend its facilities without a CPCN authorizing the

extension. Because FERC had not issued Williston a CPCN

specifically authorizing an expansion of Williston’s facilities

to include wells 19-1 and 195, the district court concluded it

the owner of property to the compensation to be paid for, the necessary right-of-way to construct, operate, and maintain a pipe line

or pipe lines for the transportation of natural gas, and the necessary land or other property, in addition to right-of-way, for the

location of compressor stations, pressure apparatus, or other stations or equipment necessary to the proper operation of such pipe

line or pipe lines, it may acquire the same by the exercise of the

right of eminent domain in the district court of the United States

for the district in which such property may be located, or in the

State courts. 

15 U.S.C. § 717f(c)(1)(A) states, in pertinent part: 

No natural-gas company or person which will be a natural-gas

company upon completion of any proposed construction or extension shall engage in the transportation or sale of natural gas, subject to the jurisdiction of the Commission, or undertake the

construction or extension of any facilities therefor, or acquire or

operate any such facilities or extensions thereof, unless there is

in force with respect to such natural-gas company a certificate of

public convenience and necessity issued by the Commission

authorizing such acts or operations . . . . 

5162 WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE
lacked jurisdiction to entertain Williston’s condemnation

claim. 

Williston does not contest the district court’s determination

that Williston would need a CPCN specifically authorizing an

extension of its facilities before Williston could undertake any

such extension. However, Williston argues that it is not bringing its condemnation claim for the purpose of extending its

facilities pursuant to § 717f(c)(1)(A). Rather, Williston contends that it is bringing its condemnation claim for the purpose of operating and maintaining its existing facilities. In

other words, Williston asserts that loss of natural gas from the

reservoir impairs its operations, and Williston needs to condemn Howell/Anadarko’s wells in order to prevent further

losses. Because Williston is not attempting to extend its storage capacity or otherwise extend its operations, Williston

claims that the acquisition of the Howell/Anadarko wells

would not constitute an “extension of . . . facilities” that

would trigger the restrictions imposed by § 717f(c)(1)(A).

Therefore, Williston contends it does not need a CPCN authorizing its acquisition of these wells. 

[3] Instead, Williston relies on § 717(h), which gives the

holder of a CPCN the right to acquire a “right-of-way to . . .

construct, operate, and maintain a pipe line or pipe lines for

the transportation of natural gas, and the necessary land or

other property . . . for the location of . . . stations or equipment

necessary to the proper operation of such pipe line or pipe

lines.” § 717(h) (emphasis added). This language, Williston

argues, supports Williston’s position that its existing CPCN

gives Williston the right to condemn property it needs for the

operation and maintenance of its existing facilities without

further authorization from FERC. 

[4] Williston’s argument required the district court to consider § 717f(c)(1)(A) and § 717f(h) and evaluate the merits of

Williston’s proposed interpretation of these statutes. Because

Williston’s right to proceed with its condemnation claim

WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE 5163
would be “sustained if the Constitution and laws of the United

States are given one construction and will be defeated if they

are given another,” Steel Co., 523 U.S. at 89 (internal quotation marks omitted), dismissal for want of subject matter

jurisdiction is improper. 

The Bell exception to this rule is inapplicable here. While

the district court was correct to reject Williston’s interpretation of § 717f(c)(1)(A) and § 717f(h), see infra at 5170, the

interpretation itself has not been foreclosed by our precedent.

See Oneida Indian Nation of N.Y. v. County of Oneida, 414

U.S. 661, 666 (1974). Moreover, despite Howell/Anadarko’s

argument that Williston’s condemnation claim is facially deficient under Rule 71A, we cannot say the claim is so immaterial, insubstantial, or frivolous on its face as to defeat federal

jurisdiction. See Bell, 327 U.S. at 682-83; see also FED. R.

CIV. P. 71A (2006) (current version at FED. R. CIV. P. 71.1

(2007)). 

B

We nonetheless affirm the district court’s dismissal of Williston’s condemnation claim on the ground that Williston’s

complaint fails to state a claim upon which relief can be

granted. See Foster, 504 F.3d at 1050; FED. R. CIV. P.

12(b)(6). To survive a motion to dismiss for failure to state a

claim under Federal Rule of Civil Procedure 12(b)(6), the

plaintiff must allege “enough facts to state a claim to relief

that is plausible on its face.” Bell Atl. Corp. v. Twombly, 127

S. Ct. 1955, 1974 (2007). “[W]e may generally consider only

allegations contained in the pleadings, exhibits attached to the

complaint, and matters properly subject to judicial notice. We

accept all factual allegations in the complaint as true and construe the pleadings in the light most favorable to the nonmoving party.” Outdoor Media Group, Inc. v. City of Beaumont,

506 F.3d 895, 899-900 (9th Cir. 2007) (internal quotation

marks and citation omitted). 

5164 WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE
Williston argues that it has stated a claim for relief under

§ 717f(h) by alleging that the property it seeks to condemn is

necessary to the continued operation and maintenance of its

existing facilities. Under Williston’s interpretation of

§ 717f(h) and § 717f(c)(1)(A), see supra at 5163, Williston is

not seeking to extend its facilities, and thus can proceed with

its condemnation claim without further authorization from

FERC. Based on this interpretation, Williston contends that it

has sufficiently stated a claim for relief, and the district court

erred in dismissing its condemnation claim. Williston does

not dispute that it would lack authority to condemn Howell/

Anadarko’s wells, and thus would not be able to state a claim

for relief, if acquisition of those wells constituted an extension

of Williston’s facilities. Therefore, our determination regarding whether dismissal was proper under Rule 12(b)(6) turns

on our answer to the question whether Williston is seeking an

“extension” of its facilities for purposes of § 717f(c)(1)(A). 

[5] We start with the plain language of the statute. Gwaltney of Smithfield, Ltd. v. Chesapeake Bay Found., Inc., 484

U.S. 49, 56 (1987). Although the NGA does not define what

constitutes the “extension of any facilities,” see

§ 717f(c)(1)(A), the common usage of the word “extension”

at the time the NGA was enacted would include an expansion

of the physical boundaries of a facility by adding additional

property.3See WEBSTER’S NEW INTERNATIONAL DICTIONARY OF

THE ENGLISH LANGUAGE 900 (2d ed. 1937) (defining “extension” as “enlargement in dimension, area, duration, or

3The phrase “extension of any facilities” in § 717f(c)(1)(A) first

appeared in § 7(c) of the Natural Gas Act of 1938, Pub. L. No. 75-688,

52 Stat. 821 (1938), which provided: “No natural-gas company shall

undertake the construction or extension of any facilities for the transportation of natural gas . . . until there shall first have been obtained from the

Commission a certificate that the present or future public convenience and

necessity require or will require such new construction or operation of any

such facilities or extensions thereof . . . .” This section was amended in

1942 to its current form. See An Act to Amend Section 7 of the Natural

Gas Act, Pub. L. No. 77-444, 56 Stat. 83, 83-84 (1942). 

WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE 5165
scope”). Williston has not pointed to any language in the

NGA or implementing regulations supporting Williston’s

interpretation of the word “extension” as excluding the addition of property in cases where such property is useful for a

natural gas company’s operation or maintenance of its existing facilities. 

[6] Rather, the structure of the NGA and its implementing

regulations indicate that § 717(c)(1)(A) applies in every case

where a natural gas company acquires additional property,

even for operation and maintenance purposes. The NGA gives

FERC “comprehensive authority” over the control of natural

gas companies’ facilities. See Schneidewind, 485 U.S. at 308.

“[A] natural gas company must obtain from FERC a ‘certificate of public convenience and necessity’ before it . . .

extends . . . any facility,” because FERC must first be assured

that the project will be carried out “in compliance with”

FERC’s rules and regulations, and that the project is “in

accordance with the public interest.” Id. at 302-03. Allowing

a natural gas company to condemn property beyond the scope

of its CPCN whenever that property could be useful for the

operation or maintenance of an existing facility would create

a significant gap in FERC’s oversight of new projects and

acquisitions, one of the principal goals of § 717f(c)(1)(a). See

id. Moreover, it is inconsistent with a key Congressional goal

in enacting the NGA, namely, to have FERC balance the competing public interests involved in a proposed project through

the issuance of certificates of public convenience and necessity. See § 717f(e); Schneidewind, 485 U.S. at 300-04; see

also Consol. Edison Co. of N.Y., Inc. v. F.E.R.C., 315 F.3d

316, 319 (D.C. Cir. 2003) (“FERC may authorize or certificate any pipeline project that the agency determines is necessary or desirable in the public interest.”) (internal quotation

marks omitted). 

[7] Moreover, Williston’s proposed interpretation of the

word “extension” in § 717f(c)(1)(A) as excluding acquisitions

of property useful for operation or maintenance is contrary to

5166 WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE
FERC’s implementation of the NGA. FERC has consistently

interpreted the NGA as requiring natural gas companies to

obtain a CPCN before expanding a facility’s physical boundaries to include additional property, even when the natural gas

company is undertaking such expansion for the purpose of

establishing a buffer zone to prevent gas migration from an

existing storage reservoir. In implementing the Congressional

scheme, FERC has promulgated regulations to ensure that

landowners will be informed of any proposed infringement of

their property rights, and will have an opportunity to contest

such proposed infringements, prior to condemnation proceedings. Thus the applicant for a CPCN is required to submit a

complete map of the proposed project, 18 C.F.R.

§ 157.14(a)(6), and provide notification to all affected landowners, id. § 157.6(d), including owners of property interests

whose property “[i]s within the area of proposed new storage

fields or proposed expansions of storage fields, including any

applicable buffer zone.” Id. § 157.6(d)(2)(iv). The CPCN

applicant must inform the landowner of its rights “at the Commission and in proceedings under the eminent domain rules of

the relevant state.” Id. § 157.6(d)(3)(v). Landowners then

have an opportunity to intervene and protest the proposed

project. See id. § 157.10. Even when FERC provides a mechanism for giving qualifying natural gas companies advance

approval to “acquire, construct, modify, replace, and operate

facilities for the remediation and maintenance of an existing

underground storage facility,” id. § 157.213(a), (b), FERC

does not allow such qualifying companies to expand their

storage facilities’ physical boundaries. Rather, natural gas

companies may undertake the specified improvements without prior FERC authorization “provided the storage facility’s

certificated physical parameters—including . . . reservoir and

buffer boundaries . . . remain unchanged.” Id. These regulations, which provide multiple layers of protection for landowners, are inconsistent with Williston’s proposed

interpretation of the NGA as allowing a natural gas company

WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE 5167
to condemn property for operation or maintenance purposes

without having to obtain FERC approval. 

ANR Pipeline Co., 76 F.E.R.C. ¶ 61,263 (1996), further signals FERC’s rejection of an interpretation of the NGA that

would allow natural gas companies to expand their storage

facilities’ physical boundaries without FERC authorization. In

ANR Pipeline Co., FERC considered an application by ANR,

a natural gas company that sought to condemn property it

deemed necessary to prevent migration of stored gas beyond

its existing storage field boundary. 76 F.E.R.C. at ¶ 62,346.

ANR sought a “revised, larger boundary” for its storage field

in order “to acquire, through eminent domain if necessary, the

property rights it needs to protect the stored gas.” Id. FERC

described its role under § 7171f(c) as follows: 

Since ANR is an interstate natural gas pipeline

engaged in the transportation of natural gas in interstate commerce, it is subject to the jurisdiction of the

Commission and to section 7(C) [15 U.S.C.

§ 717f(c)] of the NGA. Where appropriate, the Commission has granted jurisdictional storage field operators amended certificate authority to revise their

storage field boundaries in order to allow them to

initiate condemnation procedures to seek storage

easements that will allow for continued efficient

operation of their certificated gas storage facilities. 

ANR Pipeline Co., 76 F.E.R.C. at ¶ 62,346. As indicated in

ANR Pipeline Co., FERC must authorize natural gas companies to seek condemnation of additional property needed for

efficient operation, and will grant such authorization only

where “appropriate” and “required by the public convenience

and necessity.” Id. There would be no need for a natural gas

company to apply to FERC for an amended authorization if

it were free to condemn property required for efficient operation or maintenance purposes without FERC approval. See id.;

see also Trunkline LNG Co., 51 F.E.R.C. ¶ 61,202 (1990)

5168 WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE
(determining that the acquisition of property for “dispersion

exclusion zones,” constitutes an extension of the certificated

facilities and requires pre-approval from FERC). 

The Sixth Circuit reached a similar conclusion in the leading case of Columbia Gas Transmission Corp. v. An Exclusive

Gas Storage Easement, 776 F.2d 125 (6th Cir. 1985). In that

case, a natural gas company, Columbia, sought to condemn an

easement for underground storage of natural gas in property

that was one to two miles away from Columbia’s storage

field. See id. at 125-26. Columbia possessed a 1953 CPCN

which did not cover the property it sought to condemn, but

Columbia argued that it did not need an amended CPCN

because the property it sought to condemn contained gas that

had migrated from Columbia’s gas storage reservoir and the

easement was necessary to protect its certificated natural gas

storage pool. See id. at 126. 

The district court had disagreed. Noting that a natural gas

company’s certificated facilities were those described in the

map attached to its application for a CPCN, Columbia Gas

Transmission Corp. v. An Exclusive Gas Storage Easement,

578 F. Supp. 930, 934-35 (N.D. Ohio 1984); see 18 C.F.R.

§ 157.14(a)(6) (requiring the attachment of a detailed geographical map to an application for a CPCN), the district court

held that a CPCN holder’s power of eminent domain “extends

only to the property located within the geographical area designated on the map or maps attached to the application for the

certificate of public convenience and necessity” as required

by the FERC regulations. 578 F. Supp. at 932. The Sixth Circuit affirmed the district court, ruling that § 717f(h) allowed

Columbia to condemn the additional property, but only if it

first “secure[d] a valid certificate of public convenience and

necessity” encompassing that property. 776 F.2d at 128-29.

See also B&J Oil & Gas v. Fed. Energy Reg. Comm’n, 353

F.3d 71, 73-74 (D.C. Cir. 2004) (noting FERC’s authority to

enlarge a storage field boundary when expansion is necessary

to preserve the integrity of the storage field); Tenn. Gas PipeWILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE 5169
line Co. v. 104 Acres of Land, 749 F. Supp. 427, 432 (D.R.I.

1990) (holding that a natural gas company was not entitled to

expand the scope of an easement authorized by its CPCN

without further authorization). 

Williston’s efforts to distinguish Columbia Gas are

unavailing. Williston notes that Howell/Anadarko’s wells are

drilled through the Elk Basin Storage Reservoir and are

within the lateral boundaries of Williston’s storage facility,

while in Columbia Gas the wells were drilled in areas beyond

the lateral boundaries of the natural gas company’s facility.

However, § 717f(c) and 717f(h) make no distinction between

extensions to property interests outside the lateral boundaries

of a certificated facility and those outside the vertical boundaries of a certificated facility. Columbia, like Williston, was

attempting to use a condemnation action to stop a third party

from engaging in gas production operations that were allegedly capturing gas from Columbia’s storage pool, and the

Sixth Circuit held that the NGA required Columbia to first

obtain an amended CPCN. The fact that Williston’s condemnation action is aimed at stopping the production of gas in a

lower geologic formation is not material. Williston is seeking

to acquire property that belongs to another party, the acquisition of which has not been specifically authorized by FERC.

[8] Because Williston’s strained interpretation of the word

“extension” is inconsistent with the structure and logic of the

NGA and with FERC regulations, we agree with the Sixth

Circuit that a natural gas company may not condemn additional property that is not specifically described in its existing

CPCN, even if the natural gas company seeks to acquire such

property in order to operate and maintain an existing storage

facility. In the typical case, the property covered by the existing CPCN will be specifically designated in the map exhibits

attached to the application for the CPCN pursuant to 18

C.F.R. § 157.14(a)(6). Williston does not dispute that the

facility described in Williston’s application for a CPCN does

not include Howell/Anadarko’s leasehold interests in the two

5170 WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE
wells completed in the Sundance and Morrison formations.

Therefore, Williston’s CPCN provided no basis for a condemnation order under § 717f(h). Accordingly, Williston’s

amended complaint failed to “state a claim to relief that is

plausible on its face,” Twombly, 127 S. Ct. at 1974, and the

district court did not err in dismissing the complaint. 

The district court also acted well within its discretion in

declining to exercise supplemental jurisdiction over the

remaining state law claims. See 28 U.S.C. § 1367(c) (“The

district court may decline to exercise supplemental jurisdiction over a claim . . . if . . . the district court has dismissed

all claims over which it has original jurisdiction . . . .”); see

also Foster, 504 F.3d at 1051-52 (holding that the “decision

whether to continue to exercise supplemental jurisdiction over

state law claims after all federal claims have been dismissed

lies within the district court’s discretion”). 

III

We next turn to Williston’s argument that the district court

erred in holding that it lacked federal subject matter jurisdiction over Williston’s state law claims. Williston argues that it

does not need to rely on supplemental federal jurisdiction

over its state law claims, because the state law claims themselves invoke federal subject matter jurisdiction under 28

U.S.C. § 1331 and 15 U.S.C. § 717u. See Grable & Sons

Metal Prods., Inc. v. Darue Eng’g & Mfg., 545 U.S. 308

(2005). Section 1331 provides: “The district courts shall have

original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States.” Section 717u

provides, in relevant part: 

The District Courts of the United States and the

United States courts of any Territory or other place

subject to the jurisdiction of the United States shall

have exclusive jurisdiction of violations of this chapter or the rules, regulations, and orders thereunder,

WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE 5171
and of all suits in equity and actions at law brought

to enforce any liability or duty created by, or to

enjoin any violation of, this chapter or any rule, regulation, or order thereunder. 

[9] While § 717u does not expressly limit its jurisdictional

grant to cases “arising under the Natural Gas Act,” thereby

paralleling the statutory language in § 1331, the Court has

held that “[s]uch limitation is clearly implied.” See Pan Am.

Petroleum Corp. v. Superior Court, 366 U.S. 656, 665 n.2

(1961). 

The Court has consistently interpreted jurisdictional statutes with an “arising under” qualification, like 28 U.S.C.

§ 1331 and 15 U.S.C. § 717u, as “giv[ing] the lower federal

courts jurisdiction to hear, originally or by removal from a

state court, only those cases in which a well-pleaded complaint establishes either that [1] federal law creates the cause

of action or that [2] the plaintiff’s right to relief necessarily

depends on resolution of a substantial question of federal

law.” Franchise Tax Bd. v. Constr. Laborers Vacation Trust,

463 U.S. 1, 27-28 (1983). The second basis for jurisdiction

arises when a federal court determines that “a state-law claim

necessarily raise[s] a stated federal issue, actually disputed

and substantial, which a federal forum may entertain without

disturbing any congressionally approved balance of federal

and state judicial responsibilities.” Grable, 545 U.S. at 314.

We first consider the argument that the district court had

jurisdiction over Williston’s state law claims under § 717u.

Our cases have interpreted jurisdictional provisions substantially identical to § 717u, namely 15 U.S.C. § 78aa and 16

U.S.C. § 825p,4 as giving federal courts jurisdiction over state

4

15 U.S.C. § 78aa provides, in pertinent part: 

The district courts of the United States and the United States

courts of any Territory or other place subject to the jurisdiction

5172 WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE
law claims brought to enforce federal obligations. See Cal. ex

rel. Lockyer v. Dynegy, Inc., 375 F.3d 831, 838-43 (9th Cir.

2004) (holding that 16 U.S.C. § 825p provided a basis for

subject matter jurisdiction over a state common law claim

predicated on a violation of a FERC tariff); Sparta Surgical

Corp. v. Nat’l Ass’n of Sec. Dealers, 159 F.3d 1209, 1211-12

(9th Cir. 1998) (holding that 15 U.S.C. § 78aa provided a

basis for subject matter jurisdiction over a state common law

claim predicated on a violation of federal securities law). 

Williston argues that Lockyer and Sparta are controlling in

this case and require us to hold that § 717u gave the district

court jurisdiction over Williston’s state law claims to enforce

a duty created by the NGA. Williston characterizes its claims

as follows: Williston has a duty to operate the Elk Basin Storage reservoir pursuant to its CPCN, and in accordance with

the Natural Gas Act and FERC regulations. Williston’s conversion and trespass claims, and its associated request for

injunctive relief, are intended to prevent Howell/Anadarko

from taking actions that interfere with Williston’s compliance

with these federal legal requirements. Because § 717u gives

a district court jurisdiction over any action “to enforce any liability or duty created by” the NGA and associated rules and

regulations, Williston contends that the district court had

of the United States shall have exclusive jurisdiction of violations

of this chapter or the rules and regulations thereunder, and of all

suits in equity and actions at law brought to enforce any liability

or duty created by this chapter or the rules and regulations thereunder. 

16 U.S.C. § 825p provides, in pertinent part: 

The District Courts of the United States, and the United States

courts of any Territory or other place subject to the jurisdiction

of the United States shall have exclusive jurisdiction of violations

of this chapter or the rules, regulations, and orders thereunder,

and of all suits in equity and actions at law brought to enforce

any liability or duty created by, or to enjoin any violation of, this

chapter or any rule, regulation, or order thereunder. 

WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE 5173
jurisdiction to grant an injunction to prevent Howell/

Anadarko from taking actions that could threaten Williston’s

ability to perform its duties under the NGA. 

[10] This argument is meritless. Unlike the state law claims

at issue in Lockyer and Sparta, Williston’s state law claims do

not fall within the relevant exclusive jurisdiction provision.

Section 717u does not provide federal jurisdiction for a state

law claim against a party whose obligations or duties under

the NGA are not at issue. See § 717u (giving a court jurisdiction “to enforce any liability or duty created by, or to enjoin

any violation of, this chapter [NGA] or any rule, regulation,

or order thereunder.”). Williston has not identified any obligation imposed on Howell/Anadarko by the NGA. Indeed, Congress has excluded natural gas production and gathering

operations, the very operations Howell/Anadarko is undertaking in the Elk Basin field, from the scope of the NGA. See 15

U.S.C. § 717(b) (the provisions of the NGA are not applicable

to “the production or gathering of natural gas”); see also Fed.

Power Comm’n v. Panhandle E. Pipe Line Co., 337 U.S. 498,

509-13 (1949) (holding that § 717(b) precluded FERC from

regulating an activity excluded from the NGA under that provision, even when the activity would negatively impact a natural gas company’s ability to fulfill its duties and obligations

under the NGA). By contrast, the plaintiffs in Lockyer and

Sparta were attempting to enforce the defendants’ obligations

under federal law. See Lockyer, 375 F.3d at 841 (holding that

federal jurisdiction existed under 16 U.S.C. § 825p when

“[t]he state lawsuit turns, entirely, upon the defendant’s compliance with a federal regulation”); Sparta, 159 F.3d at 1212

(holding that federal jurisdiction existed under 15 U.S.C.

§ 78aa where plaintiff’s state law claims were founded on the

propriety of defendants’ federally regulated conduct).

Because resolution of plaintiffs’ state law claims in both

Lockyer and Sparta required us to determine whether defendants had complied with rules that had the effect and force of

federal law, we determined that we had jurisdiction under

§ 825p and § 78aa, respectively. 

5174 WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE
Williston argues that federal courts have jurisdiction to

ensure compliance with the NGA in the face of third party

threats, even when those threats are excluded from regulation

under § 717(b) of the NGA. To support this theory, Williston

cites Columbia Gas Transmission Corp. v. Burke, 768 F.

Supp. 1167, 1170-71 (N.D. W. Va. 1990), in which a district

court held it had subject matter jurisdiction over a natural gas

company’s state law trespass action based in part on the

impact the trespass would have on the company’s ability to

comply with the NGA. We disagree with this conclusion to

the extent the district court’s assertion of federal jurisdiction

was based on the natural gas company’s own duty to comply

with the NGA, rather than on enforcing the defendant’s obligations under the NGA. The NGA does not authorize a federal court to enjoin non-regulated activities that interfere with

a regulated company’s operations. See 15 U.S.C. § 717u.

Therefore, Williston’s reliance on Burke is unavailing. 

[11] Because Williston is not trying to enforce the

defendants-appellees’ obligations under the NGA, its claims

do not fall within § 717u and do not invoke the federal courts’

exclusive jurisdiction. Therefore, we reject Williston’s argument that Lockyer and Sparta are controlling. 

[12] Finally, we consider whether Williston has otherwise

established that its state law claims arise under federal law.

As noted in Grable, in order for a state law claim to provide

a basis for federal jurisdiction, the state claim must “turn on

substantial questions of federal law,” and “really and substantially involv[e] a dispute or controversy respecting the validity, construction or effect of [federal] law.” 545 U.S. at 312-

313 (internal quotation marks omitted; alterations in original).

In Grable, the Court determined it had federal jurisdiction

over a state claim where “the meaning of the federal statute”

was an essential element of a state quiet title action, “and the

meaning of the federal statute [wa]s actually in dispute.” Id.

at 315. Here, we cannot say that a court would need to resolve

a disputed provision of the NGA in order to resolve WillisWILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE 5175
ton’s state law conversion or negligence claims, because no

provision of the NGA constitutes an essential element of

those claims. In sum, Williston has not identified a “substantial question[ ] of federal law” upon which its state law negligence and conversion claims would turn. Id. at 312.

Therefore, the federal courts have no jurisdiction over such

claims.

IV

In conclusion, we affirm the district court’s dismissal of

Williston’s condemnation claim on the ground that it failed to

state a claim, and hold that the district court did not abuse its

discretion in declining to exercise supplemental jurisdiction

over the state law claims. We also affirm the district court’s

dismissal of Williston’s state law claims for lack of subject

matter jurisdiction. 

AFFIRMED.

5176 WILLISTON BASIN v. AN EXCLUSIVE GAS STORAGE