[DennyF]

"Forced pooling" legislation for gas industry planned in Pennsylvania
by laura legere (staff writer)
Published: July 11, 2010

Landowners without gas leases could be compelled to allow companies to drill in the Marcellus Shale beneath their land under a procedure outlined in legislation proposed by two members of the state House of Representatives.

The "Conservation Pooling Act," sponsored by state representatives Marc Gergely, D-35, Allegheny County, and Garth Everett, R-84, Lycoming County, which has not yet been introduced, would establish how gas companies form orderly units of land for developing the gas from the shale - a priority issue for the growing Marcellus Shale industry in the state.

According to a draft of the legislation circulated by lawmakers who have been asked to co-sponsor it, the act would create a state office to oversee pooling as well as a procedure for compensating holdout landowners while keeping them from blocking development of the gas from leased properties around them, a concept known as "forced pooling."


http://thetimes-tribune.com/news/forced-...lvania-1.885341

 

[Guest3]

Worth reading the whole thing, IMO.

Thus far, I would oppose the bill.

 

[Bluetick]

Co-sponsor memorandum:

DATE: June 15,2010 SUBJECT: Request for Co~Sponsorship -Conservation Pooling

DEPUTY WHIP
COMMITTEES
LABOR RELATIONS, MAJORfTY VICE-CHAIRMAN CONSUMER AFFAIRS. SUBCOMMITTEE
CHAIR ON TELECOMMUNICATIONS GAME & FISHERIES PROFESSIONAL LICENSURE POLICY
PENNSYLVANIA LEGISLATIVE SPORTSMEN'S CAUCUS, MAJORITY CHAIRMAN
ALLEGHENY COUNTY DEMOCRATIC DELEGATION


We intend to introduce legislation that enhances conservation efforts and protects landowners affected by the ongoing development ofthe Marcellus Shale. This legislation -entitled the "Conservation Pooling Act" will achieve multiple compelling policy goals, including:

• Minimizing the surface impact of Marcellus Shale drilling by limiting the number ofwell pads (usually 5 acres) necessary to develop a drilling unit (usually 640 acres)

• Maximizing the opportunity for landownerllessors (i.e., royalty owners) to obtain full economic benefit from their Marcellus leases

• Protecting non-mineral interest owners from having natural gas developed from under their property under the Rule of Capture without fair compensation

• Ensuring no surface trespass for non-mineral interest owners who are pooled into a unit

The title of this legislation -"Conservation Pooling Act" -is especially appropriate since the Commonwealth has been a signatory to the Interstate Compact to Conserve Oil & Gas since 1941. The purpose ofthat Compact is to conserve oil and gas by preventing physical waste from any cause.

Leaving recoverable gas in the ground would be a physical waste of the valuable resource. Worse yet, it makes absolutely no sense to require the construction of multiple well pads to develop a minimum of 640 acre drilling unit when a single pad may be sufficient.


Given the technological advances in horizontal drilling, Pennsylvania has the opportunity to reach vast areas of natural gas reserves while minimizing surface impacts and avoiding the waste of natural gas from leaving significant untapped areas. This approach also allows the greatest number of willing mineral interest owners to realize the value oftheir resource and protects non-mineral owners from not being compensated for natural gas they would otherwise own by eliminating the existing Rule of Capture.

However, to reach these four important goals operators must be able to form effective and efficient drilling units that recognize the geography and geology ofPennsylvania. Such units must include all of the mineral interests within the boundaries of the proposed units in order to create the "pool".

Our legislation will provide a fair and open process for establishing units and obtaining approval from the Commonwealth for each unit after all interested and affected parties have had an opportunity for their views to be heard. In addition, before the state approves any pooling unit, the applicant will be required to already control a super majority of the mineral interests with in the proposed unit.

Our legislation will achieve these four important policy goals and we urge you to join us in co-sponsoring this important piece of legislation and ensuring its prompt enactment by the General Assembly. Ifyou are interested co-sponsoring. please contact Brandi Kennedy in Rep. Gergely's office by phone at 783-1018. in-caucus extension 6481. or by email [email protected].

Original document:

http://www.legis.state.pa.us/WU01/LI/CSM/2009/0/5114.pdf

 

[Guest3]

They left out:

Our legislation will force landowners who want to retain their rights to lease anyhow at 12.5%.

 

[Woods walker]

Yep, the money grabbing legislators want to make sure they can suck every dollar out of the ground, even of it is your ground and you don't want drilling. I can se this going to the Supreme Court.

 

[SigPro2340]

I am still waiting for the gas companies to form some sort of joint utility company then run rough-shod over everyone.

 

[TributeArcher]

So what your telling me.... if i had a gas well on my property... and one "landowner" doesnt want the well to be put on... you think its ok to tell the guy..."Well, Bob down the street said he doesnt want you going underneath his house to extract the gas... so the well that you want will not be drilled just because he say's no.." This is why I am sooooo glad PA is a "Right to Pool" state currently. if the well isn't going to be on his property, why doesnt the land owner bite the bullet, cash his check once a month and shut his pie hole. The forced pooling is for drilling in suburban areas where one well pad can cover multiple acres without disturbing anyone. look at the Galleria of Pittsburgh Mills- Range Resources is drilling a 12 or 13 well,well pad. its going to extract all the gas that is underneath and NO ONE WILL EVER KNOW THE DIFFERENCE... this isnt longwall mining ppl...

 

[timberdoodle]

What effect would this have on lease negotiations?

 

[Guest3]

The bill, all 37 pages, is posted below in Outdoor Issues. Haven't gone through the whole thing yet.

 

[Bluetick]

This bill needs explained in detail in plain language if I am ever going to support it. As I read it it just keeps getting worse and worse.


This thing strips property rights. Unless sold or otherwise encumbered, your property extends from the center of the earth to the reaches of the atmosphere.

The concept might be good. Less well sites, less disruption, but the language and ability of others to determine land use is abysmal. It does, indeed, harken back to the feudal or share cropper mentality where the powerful have control at the determent of the less powerful.

Increase the protections for all landowners, and make objections realistic (as opposed to the language in the proposed bill posted in Outdoor issues) and it might be workable.

As is, this bill will penalize the land owner that does not want to participate. Objections are severally restrictive and many are ruled out from the get go.

In summation, to much power, concentrated with few people that leaves few or no options for others. Worse, it penalizes those that oppose the plans of others - property rights, personal concerns, or personal principals matter not.

That my friends is not what this country is about nor founded on.

 

[Samuel]

I am still waiting for the gas companies to form some sort of joint utility company then run rough-shod over everyone.

Read somewhere they already are applying for utility status so they do not have to pay landowners for gas lines.

link

 

[timberdoodle]

they still will have to pay even if they do get public utility status. Any eminent domain case the owner gets paid. The question is how much

 

[Dan_Hill]

It would be interesting to see how many situations exist where gas development companies already have the 75% figure locked up (or nearly so). And why 75% as a threshold in the draft bill language, for that matter? Certainly, the bill gives an advantage to those who jumped into the play early. It seems as if competitors holding 25% of the market would be good thing for competition, lessor/landowner rights and benefits, among other things. And of those in early, I wonder where they are headquartered--I mean really headquartered, digging beyond the latest LLP papers.

 

[DennyF]

More questions than ready answers, at the moment. My initial reaction was not favorable.

 

[PA-Joe]

I have been waiting for one of the larger Townships to set up a public gas utility and require all of their property owners to join in. In that way everyone can share in the profits.