Corbett: It is not my intention to alter or affect the agreed-to terms of any existing lease

QFFECE THE Governor      
July 9, 2013



Today I signed Senate Bill 259, which amends Act 60 of 1979, commonly referred to as the Guaranteed 

Minimum Royalty Act. This legislation provides enhanced transparency to owners of oil and gas interests 

by requiring, at a minimum, that certain information which pertains to the payment for oil or gas production 

be disclosed on a royalty check stub or other means provided to the interest owner on a regular basis. 

These are important steps to better inform landowners and leaseholders regarding the production occurring 

from their property.  



I am aware of several questions and concerns which have been 'raised with regard to Section 4 of Senate 

Bill 259, which added a new Section 2.1 to the underlying statute. By signing this legislation, it is my 

intention, and I believe that of the General Assembly, to enhance the efficient development of oil and 

natural gas while safeguarding the rights and protections of landowners and leaseholders. 



It is not my intention to alter or affect the common-law Rule of Apportionment, or to alter or affect the 

agreed-to terms of any existing lease. I believe the constitutional protections which guard against legislative

impairment of contracts serves as an added backstop to these concerns.  



Moreover, I do not believe anything in Senate Bill 259 expands the ability of an oil or gas operator to define the size of a drilling unit, or to expand the ability of any operator to hold by production any parcels of leased land. Instead, the legal clarity provided by this legislation will further minimize environmental impacts and 

surface disturbance associated with oil or gas development; maximize the economic benefits of royalties 

realized by landowners and leaseholders; expand the number of royalty owners in the Commonwealth by 

encouraging the efficient development of oil and gas resources; and ensure that landowners and 

leaseholders are compensated fairly.  



I look forward to working with members of the General Assembly on additional, future steps to ensure that the interests of landowners are paramount.  



Sincerely, 

TOM CORBETT  

Governor

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Replies to This Discussion

Permalink Reply by Rick on July 23, 2013 at 4:14am

Here's an example of new technology that nobody... i just bet NOBODY, not the best lawyer on either side of the issue has addressed in their lease... which according to the trend of court decisions will definately be allowed on your property!  Why? because its not expressly prohibited...

http://news.psu.edu/story/281335/2013/07/11/research/carbon-dioxide... 

Are you ok with noise traffic and whever would be required for some huge compressor facilities on your land? Plus whatever structures would be needed to pump CO2 into wells on your property?

If you notice, nowhere in the article does it mention the landowner... we are considered as a minor inconvience at best.

So see what  I mean? you CANNOT envision every possible scenaro and list them in your lease... things havent been invented yet that will be allowed on your property unless we can stop abuse of loopholes by this "leave corporations alone and they will do the right thing" mentality!

What if they decide these wells would be a wondeful place to store spent radioactive material from power plants?  Better put that in your lease also...

Permalink Reply by Rick on July 24, 2013 at 12:51pm

Ok What was I just saying about radioactive waste? check it out here

http://www.ohio.com/blogs/drilling/ohio-utica-shale-1.291290/u-s-sh...

Who has a lease that prohibits this raise your hand...

Permalink Reply by Frank Walker on July 18, 2013 at 1:14pm

Inch

Corbett has taken hundreds of thousands of dollars, over the years, from O&G.  The only good thing about him is that he will not shut down drilling.  Some Democrats want to shut it down.  That's the horrid choice we face.

Oh, one other thing:

The Democrats are primarily beholden to their city constituents, not to us.  City people want cheap gas.  You can, I hope, connect those dots.

Permalink Reply by SpreadsheetWizard on July 19, 2013 at 4:42am

Yeah, I can connect the dots, but you are being deceived by a false choice.  I do not advocate voting Democrat.  I do advocate that Republican voters pay attention to their candidates running in the primaries and vote for the ones who support the interests of land owners over those of O&G.

There must be some Republicans left who have not sold out to big business.  Help those candidates spread the word that royalties paid to land owners and drilling costs are only a small part of the price city folk pay for gas.

Regarding calls to shut down drilling, as an engineer I am appalled at the lousy science behind the calls to prohibit fracking.  Fracking takes place so far below the water tables that contamination through the rock strata from below is highly improbable. 

If the problem were carefully studied, I would bet a lot that one would find the root causes of water contamination to be poorly designed or poorly maintained vertical bores, and careless handling of fracking liquid.  These are controllable factors.  The vertical hole is subject to pressures the same as or higher than the horizontal bore, and until an alternative is developed the liquid waste is inevitable.  As the saying goes, "You can't make an omelet without breaking some eggs."

274fe3cm60wnmPermalink Reply by 274fe3cm60wnm on July 24, 2013 at 1:08pm

nobody will shut it down-  I've actually sat with elected ppl on the buses and had 1 on 1's more than most people can say.. and they can't get elected without it.. would you want to be the man in the power seat when the industry goes?   ha ha talk about a bullet to a career.   O&G put Obama in power.. Mit was cool with Nuke-  Corbett is a cool man IMO.. hardly talks.  

just remember- all offices need ppl to pay them to get into office.. it's just a fact. 

Permalink Reply by randall gottus on July 17, 2013 at 5:38pm

carp...you mentioned that it should be a crime to change any legal contracts...yes. it is a crime, AND my greater fear is that what corbett has done will set a pattern in motion that will eventually render all those well-manicured addendums we have powerless. Who would have known that corbett and his republican friends would let the oil and gas companies run the state, and take most our gas over seas where they will get more money for it.

Permalink Reply by Inchworm antenna on July 19, 2013 at 8:48am

Randall, if you have already amended and ratified an old lease for clearer or improved pooling/ unitization in exchange for improved property protections, maybe even improved royalty, then how would this bill nullify those amendments?  

Im not an attorney but it seems this bill makes those who have not yet amended and ratified an old lease more likely to remain having to accept the terms of their old leases.  Whatchya think about that.  Maybe an attorney can weigh in here.

Permalink Reply by randall gottus on July 21, 2013 at 1:05pm

inchworm..( I am not an attorney)...I was just expressing a concern regarding the bill that corbett recently signed.... and if that is going to set a pattern of things to come, that is ,corbett giving the oil/gas companies anything they want, going forward.

Permalink Reply by Rockjul on July 19, 2013 at 9:50am
He is only interested in his friends, family and whoever lines his pockets just like most other politicians. I don't know who is worse Rendell or Corbett
Permalink Reply by Inchworm antenna on July 21, 2013 at 2:52pm

I have not read the bill, just what folks have written about it, and it seems what people are articulating is that if there's no limitation to unitization or pooling described within an old lease, then it's to be implied the lease is not restrictive to any maximum size.  You'll have to see what the suits think.  

However like CARP mentions above, his old lease describes a depth restriction.  I would imagine and hope he would still have a negotiations avenue there.  Maybe his O&G can be pooled and unitized now, but only to a certain depth since the depth is a clear restriction identified in that old  1890's lease.  CARP do you you care to reveal what that depth is.  Just curious to see what was on folks minds way back in 1890.  

Permalink Reply by Inchworm antenna on July 22, 2013 at 11:54am

I wouldn't be suprised if some companies may still want new leases or amendments until the new law stands the test of time and courts, and figure it all out.   If your not sure of the situation, you might want to contact an attorney.  Seems like your in PA.  There's attorneys who advertise on this site from PA, some of which have written rational landowner educational articles and blogs.  Not a bad idea to have someone to help you understand it all so you can make a good decision.

Another thing is you mention there's reservations below 4000 ft.  Are you saying through the chain of title someone else reserved and owns it but the O&G company wants you to lease it to them?  

Permalink Reply by Inchworm antenna on July 22, 2013 at 4:43pm

Carp,

Ok it's making more sense.  Now that you are mentioning Antero, do you mean Antero is leasing the deep rights or owns them?

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