I would like to start a discussion which will attempt to bring to light any news relating to current 'forced pooling' legislation in West Virginia. If anyone has news regarding the status of this issue in the legislature, or would like to post contact information for their representatives, for those who would like to contact them, it would be most welcome here.
We need to protest this violation of our private property rights.
I have drafted a letter that may be used as a template for anyone to use. Feel free to copy it, insert your county, and sign your name:
As a resident of County, WV, I am writing to inform you of my opposition to any legislation that would support or advance the practice of seizure of private property in the form of 'unitization', 'lease integration', or 'forced pooling' of privately held mineral rights.
Legislation of this type is a violation of our constitutional rights regarding private property, and will strip landowners of their negotiation strength as well, should they be willing to lease their property.
Please pass along contact information for your local representatives.
(Woody Ireland, chairperson,Energy Committee, House of Delegates, FOR forced pooling)
Tyler County representatives:
I understand that there is a bill being introduced for forced pooling this session.
Forced Pooling Bill 2688
This is up on the legislative web site
...and the other shoe drops.
Time to double down on the phone calls and e-mails.
I confess to being ignorant of the inner workings of the legislative sessions.
It would be most helpful if anyone could/would help to outline the process going forward, regarding further debate, the timeline for voting, or any other strategies for opposing this "amendment".
A friend of mine read it and apparently it would limit royalties to 1/8 and companies "could" pay bonuses, Also, companies exclude liquids. It is not good. Perhaps some else could read it and give an openion?
I just read it and found a big question: in the description of the makeup of the commission, Section 2C-9-4 (a) 3rd: The third appointee shall be an owner of minerals in this state who is not affiliated with an operator of oil or gas wells. When this member is to be appointed, the Governor shall request from the major trade association representing mineral royalty owners in this state a list of three nominees for the member to be appointed.
Does anybody know what "major trade association representing mineral royalty owners" this might be?
Also I can't find where it excludes liquids, except in the distinction between "oil" and "gas". There is some separation of the oil interest in some older leases.
If it is somewhere else, please tell where.
Section 22C-9-7 (f) for nonleased royalty owners taking option (B): the royalty is 1/8, and is NOT reduced by post production costs. I think option (A) is to sell your rights, option (C) is to become an operator as to 7/8 of your minerals, and royalty owner as to 1/8 of your minerals.
When the commission is determining appropriate lease terms for the unleased mineral owners, Section 22C-9-(g) 4 (A) seems to say they (commission) would have access to all the leases including bonus terms of the 80% (or more) who are already leased, these could be kept Confidential to the Commission.
A lot to read.
I read it, but I can't claim to have absorbed it completely.
If I were paranoid, I'd say that is intended.
As I interpret the bill, it doesn't explicitly limit the royalty to a 1/8 maximum. It does allow for the presentation of evidence of surrounding royalty agreements at a requested hearing. However, given the makeup of the 'commission' outlined in the bill, the result will likely be 1/8 max.
There are more items in this bill that can affect the eventual payments.
A victim of this seizure of property will have three options from which to choose.
I haven't had time to analyze them fully, but what is important to note is, as in the case of partition suit, there will be no signing bonus after the action, even if you agree to play ball.
This will water down owners' leverage in 'good-faith' negotiations as well. If the company doesn't like your counter-offer, they'll have the ability to simply take your minerals.
The options seem to deal with your relationship with the gasholes regarding royalties.
If you continue to refuse to play ball, you will be made a 'partner' in the well, and 7/8 of your share of the production will be subject to an equivalent share of the costs of developing the well, called a 'working interest'. The remaining 1/8 of your share will be paid as royalty with no deductions.
Again, this is similar to the result of a partition suit.
There is a 'threshold' provision that 80% of the unit that you would be in must already be under lease by the company before they could apply for the seizure action.
That gives some owners a chance to form a coalition with their neighbors, if it's not too late.
Owner groups are also more important than ever.
Hi Dan, You must have been replying at same time as I was!
Yes, quite a lot could be a problem, and gives the companies even more leverage.
And note: the 80% already leases, is net mineral acres in the area proposed for the unit, not 80% of the people.
Thanks for clarifying the language regarding the threshold percentage.
Yes, I was. In fact, other of your astute observations forced me to go back and edit the post I was writing.
I read the bill last night, and was commenting from memory.
It's great to see the interest is this issue. I'm not generally politically oriented, myself. This legislation has, as has the shale craze in general, forced itself upon us, and brought forth the activist in me.
In that spirit, I will take the opportunity to reiterate here that we need to keep up the effort to influence changes in, if not outright rejection of, this amended bill.
Interested parties should contact the numbers posted above, as well as their respective local representives and voice their displeasure with this potential violation of their private property rights.