Real Estate & Property Law

Removal of Gas Without a Lease

By Alan Ackerman

The Central Pennsylvania News article discusses the proposed 'forced pooling' going through the Pennsylvania legislative bodies.  The reality is that owners may be better off with forced pooling so long as they are fairly paid for their mineral rights being taken.  The issue will be one of how do you value the taking of your mineral rights, and whether the utilities will in some way be allowed to bludgeon owners into receiving less than the fair market value.  

Penn Live
    
Finally, there remains the issue of what happens after the minerals were removed.  Will the gas storage rights be retained by the owners or by the producer?
That's how opponents see a provision, which they call "forced pooling," about to be proposed in the state House of Representatives.

Companies would have to pay the owner a "fair" price for the gas extracted.

Nevertheless, a group of more than 30 environmental groups sent a letter to legislators calling the measure an expansion of eminent domain to benefit corporations.

That view is wildly skewed, according to those in favor of the measure, who call it "fair pooling protection."

"By far and away the largest impact would be on the producers, not on the actual landowners," said Matt Pitzarella, the public affairs director for Range Resources, an oil and gas firm. "We have not encountered a landowner that says, 'I'm just fundamentally opposed to drilling.' It's a very, very rare occurrence."

According to the Marcellus Shale Coalition, a natural gas industry group, those who don't want to lease "will not be considered leasees, nor will they see a rig on their property or an inch of their land disturbed. The only thing they will see? A check in their mailbox each month."

Horizontal drilling technology allows companies to drill thousands of feet in multiple directions from one well pad, Pitzarella said.

Full post as published by National Eminent Domain Blog on August 13, 2010 (boomark / email).