Corbett's betrayal has already started to hurt landowners.
http://triblive.com/business/headlines/4447866-74/eqt-gas-law#axzz2...
EQT Corp. has sued scores of landowners in Allegheny County for access to their properties under a recently enacted law that gives gas drilling companies the power to combine some neighboring parcels into drilling units without compensating owners.
The 69 individuals and one golf course in Forward named in the lawsuit are accused of blocking the company from conducting surveys on their land to determine where to drill for shale gas. It appears to be the gas industry's first attempt at using the controversial law.
“The fact that it's being used (to sue people) is disgusting,” said Robert J. Burnett, a Downtown attorney working with the National Association of Royalty Owners but not involved in the EQT case. The state “gave the drilling companies a weapon to beat down landowners,” he said.
EQT spokeswoman Linda Robertson said the company had been negotiating in “good faith” in Forward and still does, though it doesn't have to.
“Prior to the bill, we were working with landowners to obtain modifications and, although this bill means we no longer need to do that, EQT will honor those offers,” Robertson said. “It was determined that putting the issues before a court would be the most expeditious way to reach resolution.”
The golf course, Riverview Golf Course Inc., and lawyers for some of the defendants did not return calls.
The law, which the governor signed on July 9, gives drillers power to pool leased properties into one unit for wells that drill sideways, as long as contracts don't prohibit such combinations. Before the law, landowners could have demanded more money or better legal terms from drillers to include their properties in a pool.
The Forward contracts, like most old oil and gas leases, don't mention pooling and so the law makes it clear that Downtown-based EQT can combine them into units it needs without permission from landowners, the company claimed in its lawsuit filed July 22 in Common Pleas Court.
EQT is looking to cash in on land it controlled long before the shale gas boom. Its subsidiaries, including the old Equitable Gas Co., kept gas leases alive for decades by storing gas under the Mon Valley township, with one lease dating to 1899, the complaint said.
EQT lobbied for the law on pooling, according to state Rep. Garth Everett, who sponsored the legislation.
Most of the defendants started an alliance called the Monongahela Group, the lawsuit claimed. Its members refused to allow the company to do seismic testing unless it renegotiates their gas contracts. That “wrongfully” and “substantially impeded” EQT, lawyer Patricia L. Dodd of Meyer, Unkovic & Scott LLP wrote for EQT in the complaint.
Landowners rejected several offers, Robertson said.
EQT hasn't negotiated for months, said several residents and a lawyer working with Forward residents who aren't involved in the case. One of its offers was a one-page lease modification to allow land pooling. It offered no extra money, stating it would be for “mutual advantage,” according to the offer obtained by lawyer Steven A. Walton. Company officials stopped negotiating last fall, Walton and others said.
In November, an EQT vice president told the Tribune-Review at an industry conference that EQT wanted the state to pass the pooling legislation. The Legislature passed the bill the last weekend of June, as lawmakers rushed to meet a budget deadline before their summer recess. Gov. Tom Corbett signed it on July 9.
“Some of the Legislature didn't know better. They just kind of did whatever. If a lobbyist gives them something and tells them what to do, they'll do it,” said William Beinlich, one defendant and an organizer of the Monongahela Group.
He isn't bothered by the law and believes it won't be decisive in the case, he said. Many leases are ambiguous and may not back up EQT's claims, he said, declining to explain.
Read more: http://triblive.com/business/headlines/4447866-74/eqt-gas-law#ixzz2...
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Replies to This Discussion
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Permalink Reply by Frank Walker on
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Rick, thanks. There's almost more in your post than I can get with just one reading. Have to go back over it again.
Do have to agree with your general thesis. Now that the landowner attack precedent has been set with SB 259, only God knows what will come next. Funny some folks never heard of the negotiations SB 259 destroyed. Course that's why the industry fought for that measure so hard and snuck it in at the last moment . . because they didn't need it!! HA! HA! And that's also why NARO got so worked up; Cause it was not important to landowners. HA again!!
But seriously, your laundry list is a valuable watch list for landowners. Full disclosure, Rick: I'm in EPA, not out where you are. We don't have here some of the problems you face. But importantly, that's no reason not to support you!!!!!!!
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Permalink Reply by 2z248p19vqnh9 on
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Rick - there was a fellow that DID deal with precisely the 'angst' you somewhat describe in your paragraph #2 above...paragraph beginning 'My whole point' - YES. You are correct...ONCE YOU or anyone else SIGNS ***ANY lease - whether handled(?) by a lawyer OR on one's own stead...YOUR GOOSE IS COOKED! - all they need is that 'x' of yours on THEIR 'dotted line'...that's all she wrote! *Doesn't matter if it was today or 'yesterday'...that's just the way it is...To sign - or not to sign - THAT is the ultimate question...after THAT it's 'all she wrote'....
bum-by-auge (Bon Voyage! - bum-bitty-bim-bitty bump, bump, bump!...it's an age-old STANDBY of Kings, Queens, & 'Companies in general' - PROMISE them the moon (or basically whatever will get them to YOUR 'position' within reason) - one lies, the other swears to it? - ever hear that one?...Hitler lied, everyone swore to it - and so the calamity began...at their own behest, no less.
...back to your 'whole point'...where's Frank Dux when you talk about him?- nevermind...WHERE is he - WHY hasn't he been posting? WHAT did you all do to him? Delete him finally?
...anyway - remember when HE was dealing with things - roadways & such + ...when EVEN THOUGH he HAD done his 'due dilligence' that there were matters that were QUICKLY taken 'out of context/out of hand...HE had to 'crack the whip' himself. WHO of YOU helped in that scenario - with any intelligent thoughts? WHO of you have had to deal with matters with 'your' G&O Co.? THEY don't care about you once they have your very own 'JOHN HANCOCK to 'your kingdom'. Nah - what da' YOU care? - Never happen you YOU, will it, eh?...only to the 'other guy'? Bad mode of thought, friend....
Little glass houses - for you & me?...yah,yah,yah - NAH. STOP! Come one, come all - gather round, everyone...don't worry - EVERYONE'S getting 'caught with their pants down' around their ankles AND their shirt pulled over their heads...ALL with the quintessential 'dumb, maddening smile'.
Me & Mine? Me, oh, my...NEVER thought that would happen to ME! The Crisis of Civilization - Full Length Documentary Movie HD - Yo... You'll get yours & I'll get mine...and we'll ALL be 'fine' - in between the lines...a little for you, ALOT MORE for me - it's all 'even Stephen', so you'll see (agree?)... she'll be comin' round the corner when she comes (yes, sir!), she'll be drivin' six white horses when she comes (ya'hoo!)...she'll be comin' round the mountain, she'll be comin' round that mountain...she'll be comin' round the mountain when she comes. YEE HA! (TEE HEE?)
Ah, doesn't matter anyway. No one really gives a lick...As one light lights another, nor grows less - so nobleness enkindles nobleness. It's one for all - all for one (as long as you are the 'big gun' G&O sun-of-a-gun!...Sunoco?)
The sun will come out - tomorrow...BET your 'bottom dollar' that TOMORROW comes A-gain (gain, gain!). He who winneth souls is wise....Proverbs 11:30
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Permalink Reply by craig on
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wj, I know of no one who could get any money for the unitizing addendum. No one to my knowledge in my area (Beaver County, Pa) could get any changes they wanted either for signing. It was sign it as is, period. Good ole CHK once again.
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Craig did chesapeake buy some HBP vertical well leases? I didnt know there were many HBP vertical leases in beaver county... who did they buy them from? I dont think chesasneak was drilling vertical wells back then, but am probably wrong. And did they ultimately use those leases to drill horizontal wells? There are not that many horizontal wells in beaver county.. a handfull... less that 30 i believe.
Anyway, if anyone came to me and asked to alter a lease in ANY fashion without some concessions, monetary, and terms, i wouldnt "sign it as is, period" period.... ask your attorney, i doubt he would advise you to just sign...
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Permalink Reply by randall gottus on
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Rick, for sure..if someone came to me and asked to alter lease without offering something, do not sign! even if co. offered something..work with your attorney first.
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Permalink Reply by wyalusing jim on
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I never heard of anyone receiving anything in return for signing either craig, though I do know that many folks tried.
rick is the first one that I have heard say that someone...somewhere did.
wj
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Permalink Reply by Jim Litwinowicz on
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There was a GMS poster called Little Cougar that said she got a better lease on HBP property a couple of years ago. It can be done but I would think people would do best by working together.
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Permalink Reply by Ed on
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I don't know why SB 259 is creating so much controversy. It is simple contract law 101. For example: If you lease your home to someone to live in, and if you don't want pets in the home you should have put a clause in the lease to prohibit pets. I don't think the courts would side with you if you fought it in court.
For the life of me, I don't even know why the PA legislature even had to include the pooling clause in any Bill. This is contract law 101. The holder of the lease has certain rights unless expessly prohibited. I'm not sure why any leasee would have even renegotiated a pooling clause if the lease had no language to prohibit it. It just goes to show you that our fearless leaders in Harrisburg have nothing better to do and even some oil & gas attorneys aren't all that good.
The simple way to have prevented this in the past and in the future is through the habendum clause. Of course no one knows what future technology will bring but the habendum clause "could define" the use of the lease to what is specifically written into it and prohibit any future "uses" if not spefically stated.
I'm not an attorney and would'nt know the exact language but I'm sure it could be done. That's the purpose of an habendum clause. So in the case of an old leases, oh well...someone didn't proceed with legal council or skilled insight. Not every attorney is competent. The world is full of educated derelicts.
The biggest problem is "stupidity". I am currenty in negotiations (through a competant attorney) for a gas lease. Before I hired an attorney I went to all the neighbors around me and asked one simple question. "Did you hire an attorney to help you with your lease?" Guess what the answer was from all of them? Not one of them hired an attorney. So if they get raked through the coals...good for them. They deserve it.
Contract law 101. Better get it in writing.
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Permalink Reply by randall gottus on
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Ed...I need to do some more homework before I could respond to your SB 259 read. BUT as far as the "They deserve it" and "good for them" stuff...although I worked with an attorney, some of the other land owners here did not, and just didn't know any better, and signed on the dotted line. Go ahead and call them "stupid", but I kind of feel bad for them. I always try to tell other landowners in my area about the importance of working with an attorney, and talking among each other...I just wish that I would have gotten to them sooner.
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Permalink Reply by Ed on
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Randall...yes you are right. Those are harsh words and maybe I should be a little more sensitive towards those poor people, but it is this very thing that has hurt those of us trying to get a fair price for what is already ours. It is indeed foolish and at times downright unintelligent to just sign on the dotted line whether it was 3 decades ago or 3 years ago. Now the drilling company has clout to just say "what? you want a better deal? i'll only give you what everyone else got. fair enough??"
Everyone that signed on the dotted line is an adult and now that they are all hurting I'm going to treat them like an adult. In other words..."don't come crying to me."
The only thing I hope is that any new lessors will read this and go in with intelligence but I doubt that will happen.
I'll leave now with a quote from a famous man: : "Only two things are infinite, the universe and human stupidity, and I'm not sure about the former" Albert Einstein
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Permalink Reply by randall gottus on
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Ed, yes...good point! ...become more informed, and work with other land owners, support each other, and get plugged into other available resources. I guess it is us( landowners) against them (o&g co.'s/politics). I just hope that, going forward, all those well manicured addendums that some of us have, will not be rendered powerless as the o&g co's begin to control our political landscape.
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Permalink Reply by Inchworm antenna on
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ED, History is important to understand here. There are many storage leases that also maintain production rights to the lessee. They are called dual purpose leases. Many of the old ones have a flat rate royalty of $100 or $200 annually for gas. This is called a flat rate royalty. I would say it would be very stupid for anyone to sign such a lease. But many of those leases were the standard lease storage company's presented the landowner. Once FERC or their predecessor approved a storage field location, and the landowner did not sign the presented lease then it can become an issue of imminent domain. Someone I know signed one of those leases some 50 years ago and when I asked why he said they told me to sign it or I'll end up in court. Back in those days a royalty essentially became useless because it was not possible to drill through the storage field. Now storage fields can be drilled through and storage companies continue to look at sub-leasing options. It's only right, that the storage company or drilling operator work with the lessor as they intend to move forward now and amend those leases with a fair market royalty. Please put all that in perspective. The lessor of 50 years past was put into whole different ball game. They weren't stupid, but many were under the threat of imminent domain and court (at least when it came to the storage filed areas). I find personal property rights to be a very conservative issue, and when it's discovered that those who were under the threat of imminent domain have a lease that does does include a fair market royalty, then that royalty wrong needs to be made right & whole.
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