DEP Approves Permit on Unleased Property... - The HuntingPA.com Outdoor Community
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post #1 of 30 (permalink) Old 10-18-2013, 01:49 AM Thread Starter
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DEP Approves Permit on Unleased Property...

http://www.publicherald.org/archives/183...investigations/

The Pennsylvania Department of Environmental Protection (DEP) has issued a permit to Talisman Energy to drill a natural gas well under unleased property in Susquehanna County, according to landowners Steve and Joyce Libal and state documents provided to Public Herald. The permit would allow for fracking, a process requiring water and chemicals under high pressure to fracture underground shale to extract minerals.

Had it not been for their ‘hill of beans,’ the Libals may have never known about it.

“The only reason we know about the permit concerning our property is because a guy stopped by our farm to buy beans…thank God this man’s wife likes to pickle beans,” the Libals wrote in an announcement posted in an online natural gas forum. Their bean customer, Grove Doty, turned out to be a councilman of the neighboring borough of Friendsville.

According to Pennsylvania oil and gas law, drilling companies must notify municipal officials of plans to drill for natural gas. However they aren’t required to notify nearby or even adjacent landowners.

“Neither Talisman Energy nor the DEP notified us of this application,” wrote the Libals, who doubled checked their property deed again just to be safe. They own all of their mineral rights, and have turned down companies looking to lease their land. But, they are surrounded by leased properties.

According to the Libals, a few days after the bean sale, Steve attended the local township meeting and asked to see Talisman’s application packet. It contained a map showing 12 wells. One of the wells is routed right through Libals’ unleased property. They immediately notified DEP via email on September 18th and sent certified letters to DEP Office of Chief Counsel Richard Morrison, Deputy Secretary of Oil and Gas Scott Perry, and geologist Mark Ansell, who conducted the technical approval for Talisman’s permit.

After a week of silence, emails were sent to Ansell again on September 26th. He replied, “The application has been the subject of much discussion within the Department. Presently the situation is under review by the Legal Staff.”

According to the couple, they got a call shortly after contacting DEP from a landman claiming to represent Talisman who asked how much money it would take for them to lease their gas rights. The Libals couldn’t be bought out, and Talisman went missing.

On October 7th, they emailed Ansell again requesting the status of Talisman’s permit approval process. The next day Ansell forwarded an email from DEP’s Geologist Manager, Brian Babb:

“[I]t has been determined that the Department does not concern itself with lease issues on wells that are not subject to the Conservation Law. As is stated in the standard conditions of the permit, the permit does not give any rights the applicant doesn’t already have. Neither the Oil and Gas Act nor Chapter 78 address leasing issues. Our review is based on the Act and the Regulations, which is exclusive of leasing issues.

“If an operator fails to acquire necessary rights before drilling, the operator could be subject to the laws of trespass as applicable.”

This requires the Libals to hire an attorney and take Talisman to court.

(Note: Pennsylvania’s Conservation Law does not apply to wells drilled into the Marcellus Shale. It does apply to Utica Shale drilling.)

DEP Issues Permit Despite Libals’ Complaint

October 11th, DEP issued the permit to Talisman for the company’s plans to drill the Olympic Lakes Estates 9H well, which included a route under the Libals’ property. According to the Libals, they received a letter from DEP on October 15th stating that if they had a complaint about the permit to contact the state Environmental Hearing Board within 30 days.

In an email to Public Herald, Oil and Gas Deputy Secretary Scott Perry wrote, “DEP does not have the statutory authority to deny a well permit based on a property rights dispute.” He added, “the landowner could certainly appeal the issuance of the well permit to the EHB if they wanted to. A better course of action would be to seek some kind of injunction in county court.” Perry believes his agency would not “be liable for the trespass and or theft by the well driller.”

Spilling The Beans

In the month Councilman Doty ‘spilled the beans’ the Libals’ have been consumed by worry and their own search for answers — and they’re not alone. After sharing their story online, the couple got an email from John Hotvedt, who alleges that in February he learned that drilling company WPX has plans to drill under his property without his knowledge.

In an email offering advice to the Libals, Hotvedt wrote, “We learned through our lawyer that DEP never involves itself in lease disputes…DEP seems to have issues with regulating anything that isn’t strictly an environmental concern. But it sure seems to me to be a prudent regulatory step for some agency.”

Both Hotvedt and the Libals think state law should be changed to prevent unnecessary and unfair costs to landowners.

“We hope Pennsylvania’s state legislators will prevent the DEP from doing this to other landowners by immediately working to modify existing laws or make new laws that do the following: 1) Prevent DEP from conducting reviews of gas-well permits that include unleased property, 2) Enact penalties upon any gas company that submits a gas-well application for unleased land, [and] 3) Require gas companies to notify all landowners whose property is included in a gas-well application,” suggest the Libals.

“What if we had been in negotiations to sell our house while all of this was going on unbeknownst to us? Certainly we couldn’t have disclosed what we were unaware of to a potential buyer. What would have happened if that person had purchased the property and later discovered a gas well had been approved to run through it?”

The Libals’ sent letters to PA Attorney General Kathleen Kane and PA Auditor General Eugene DePasquale as well. Attorney General Kane’s Assistant Press Secretary, Carolyn Myers, confirmed receipt of the Libals’ letter in an email to Public Herald. “The referenced matter is under DEP’s umbrella…You may want to contact that agency,” wrote Myers in response to a question about whether DEP or any other state agency handled property rights issues associated with such cases.

Auditor General DePasquale, who’s currently investigating DEP’s procedures for handling water contamination cases, did not reply to Public Herald’s request for comment.

DEP’s Scott Perry wrote to Public Herald on October 14th that Talisman would be withdrawing the permit application. However, the Libals’ haven’t heard anything from DEP or Talisman since receiving their letter about the approved permit.

Update 10/17, 5:13 pm: Susan Woods from Auditor General Depasquale’s office called PH to state that the Libals’ matter falls under the jurisdiction of DEP and that the AG’s office “has nothing to do with it.”
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post #2 of 30 (permalink) Old 10-18-2013, 09:29 AM
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Re: DEP Approves Permit on Unleased Property...

Talisman could decide to drill the other 11 wells and depending on where the unleased acreage is located, shorten up or not drill the one well. leaving those folks mineral rights completely surrounded by horizontal well legs with no recourse but to receive no royalties whatsoever. Unfortunately, those folks are misguided or being mislead.

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post #3 of 30 (permalink) Old 10-18-2013, 11:19 AM
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Re: DEP Approves Permit on Unleased Property...

Quote:
Talisman could decide to drill the other 11 wells and depending on where the unleased acreage is located, shorten up or not drill the one well. leaving those folks mineral rights completely surrounded by horizontal well legs with no recourse but to receive no royalties whatsoever
Hmmm, me thinks if their within the "pool" the Libals are going to get paid whether they want to or not.

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post #4 of 30 (permalink) Old 10-19-2013, 12:50 AM
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Re: DEP Approves Permit on Unleased Property...

That's the other option

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post #5 of 30 (permalink) Old 10-19-2013, 03:12 AM
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Re: DEP Approves Permit on Unleased Property...

Some will remember from the last session or the one before the bill to allow use of the land via pooling and or eminent domain.

Incidentally, those legislators pushing the commissioner term limits, merger talks of the PFBC and GC - and gutting the endangered species act (state level) were the same ones pushing the eminent domain issue for the gas companies.

That bill never made it out of the committees in either house as there were two versions of it.

So it was known years ago that situations like this could occur. No one made amends for the eventuality in state law. Ironically, the reason for the bills was this exact situation. Where one landowner was refusing to sign and stopping a well pad and drilling.

States out west have various laws on this situation, including pooling of wells and taking the gas either paid for at the going rate, a state mandated rate, and I think in at least one state - just taking the gas. Bottom line is in the western states the gas companies have the upper hand.

If it were me, I would be going to the courts for an injunction regardless of what is being explained now. However, if they refuse to sign and the gas company does decide to drill the other wells - gas could be drawn off the peoples property. At this point, it appears there is no recourse for any payment or compensation in PA law. Lots of bills to address it, but they never get through committee.


As for DEP, I can understand the bind they are in. If the statute doesn't give the authority and they do they get sued. If they don't - they get sued. Meanwhile everyone else is in the same boat but poking the piggy in the middle hoping not to get caught with the stick.


This has shades of the robber barron era written all over it.

As great as the gas boom is for the state and our nation, some parts of it really stink.

Is your position a short term gain - or a long term loss? Separate the issues.
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post #6 of 30 (permalink) Old 10-19-2013, 11:58 AM
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Re: DEP Approves Permit on Unleased Property...

AS far as I can tell, the people are idiots for not signing a lease when they are surrounded by leases........

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post #7 of 30 (permalink) Old 10-19-2013, 02:33 PM
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Re: DEP Approves Permit on Unleased Property...

I can understand that they may dislike drilling so badly that they don't want to sign a lease, but they are only kidding themselves if they think they will stop that development around them. I'm not sure how many acres they have and where the parcel is located in the unit. I am also sure that the company has been in constant discussions with them about working out a deal. I'd say that they could get a pretty penny for their signing if they worked it right.

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post #8 of 30 (permalink) Old 10-19-2013, 04:06 PM Thread Starter
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Re: DEP Approves Permit on Unleased Property...

I haven't seen anything in the article saying the Libals are trying to stop development around them. I think it was rather obvious their problem was that Talisman was issued a permit to drill under their land when they had no interest in signing a lease. In that regard, it would seem they are trying to stop development on/under their OWN property. As PA does not allow forced integration, I would think that would be well within their individual property rights. As to Talisman being in contant discussions with them: "According to the couple, they got a call shortly after contacting DEP from a landman claiming to represent Talisman who asked how much money it would take for them to lease their gas rights. The Libals couldn’t be bought out, and Talisman went missing."

In my opinion, forcing the landowner to foot the bill for obtaining an injunction is ridiculous and is most definitely something that our lawmakers need to address.
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post #9 of 30 (permalink) Old 10-19-2013, 08:36 PM
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Re: DEP Approves Permit on Unleased Property...

So you're telling me that they won't get paid even if they are in the "pool"?

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post #10 of 30 (permalink) Old 10-20-2013, 12:33 AM Thread Starter
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Re: DEP Approves Permit on Unleased Property...

They did not sign a lease. There is no compulsory integration or forced pooling for non lease holders in PA. (the industry can use forced pooling of leased lands. That is not the case here - there is no lease) Therefore, they can't possibly be in the "pool".

The issue is even though the landowner in this case did not sign a lease, the DEP gave Talisman a permit to drill under their property. In this situation the landowner's only recourse is to spend hundreds to thousands of dollars out of pocket hiring an attorney to file an injunction to prevent Talisman from drilling under their land... The DEP is now stating that Talisman will be withdrawing the permit application. So far, nothing publicly stated by Talisman...
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