pipeline right of way rate

I have been contacted by a company that wants to put a pipeline across my property.  They are offering $1.00 per inch diameter x feet of pipe.  They are also considering a driveway and 5 acre staging area.  The pipeline location is mostly planted field with just a bit of timber along the entry and exit of my property.  Can anyone advise of the question to ask or what to look out for?  Is the rate acceptable?  Is it the "going rate"?  What is the going rate for a driveway and staging area?  

thanks,

Bill

Views: 3020

▶ Reply to This

Replies to This Discussion

Permalink Reply by JK on January 7, 2013 at 12:54pm

bill,

First of all, you want to tell them where you want that pipe placed.

In order to keep more use of your land you might want to consider having the pipeline placed around the edge of your property instead of thru it. This does matter.

They must pay you for your timber X board feet.

As to the rate, where is your property?

Negotiating is absolutely necessary as they always start at the lowest rate. Go as high as you can and they will pay it.

Years ago, CHK started us at $3 a foot then we got them up to $13. Now it goes for much more.

There's your first clue.

Driveways, stage areas and anything else they need will happen and of no cost to you.

You call all shots on this one.

Permalink Reply by bill on January 7, 2013 at 1:04pm

the location of the pipeline is in the lower part of 54 acre field.  The location is perfect and really shouldn't interfere with any future plans.  I asked about timber rates and they seemed surprised lol.  They are going to get back to me with the timber rate.

My property is in Mercer County.  I feel that $1/inch diameter times footage is low.  Plus there should be a cost for them to drive across my property.  I just don't have a feel for that cost yet.   

Permalink Reply by Jack Straw on January 7, 2013 at 1:02pm

There have been many past discussions on this exact subject.

Rather than rehash all that has previously been put forward, I would suggest that you start out by using the "search" feature that you will find in the upper right hand corner of the screen.

 

The bad news is that it will likely take a considerable amout of time to glean through all the information that has been posted.

The good news is that I would expect that there is much there that will be of benefit.

 

Not trying to put you off, simply trying to get you in touch with as much information as possible ... in as quick and painless a manner as possible.

 

Once you have reviewed past discussions and have benefited from those many posted opinions, you will be in a position to ask specific questions concerning the specifics of your situation.

 

I will here offer several opinions:

"$1.00 per inch diameter x feet" of pipe is too low (likely by a factor of two or three) if we are talking about a high pressure pipeline.

a pipeline ROW agreement is likely to be (and for your protection should be) the most complex contract you are ever involved in (think of it as a marriage license, till death do ye part) and you have only one opportunity to get it right.

do not sign anything until it has been reviewed by a qualified Attorney with O&G experience.

 

As one last comment: in your next post, please supply the State and the County you are located in - that will assist people in giving more specific information and advice.

Good luck,

                      JS 

 

 

 

Permalink Reply by bill on January 7, 2013 at 1:12pm

Thanks for the response Jack.  I will definitely keep searching.  I did find some discussions, and learned a lot, but I didn't see any current.  I assumed the rate would be different than a year ago.

Great advise and thanks for your opinions.  I live in Mercer County, Pennsylvania.  I will search this site for qualified Attorneys with experience in O&G.  

Permalink Reply by Jack Straw on January 7, 2013 at 1:55pm

bill,

        If you have not already done so, you may wish to join the Mercer County Group.

The price you might expect will not have changed in the past year.

How much you receive in compensation is important, but there are very many important clauses that go into a good ROW agreement.

Clauses to cover: indemnification, liability, damages, access, minimum depth of burial, width of ROW and temporary construction easement, definition of what is allowed in pipeline, allowed appertunances, how you handle damages from future repairs and/or replacement, right to add future additional pipelines, a pre-construction survey with agreed to location specified by metes & bounds, remediation/restoration, preservation of topsoil, erosion control, reseeding/replanting, future termination of ROW, are a few that immediately come to mind - doubtless many more that I have missed.

If they have already put forward their "boiler plate" agreement, it is likely two pages long - what you should end up with (in order to have the necessary protections) should be more like ten pages long.

 

A difficulty lies in the reality that it is near impossible to obtain a copy of a "good" agreement to use as a template .... if a landowner negotiates a good agreement, the Grantee will insist upon a confidentiality clause, so that it never sees the light of day. The ROW agreement that gets filed and is available to peruse at the County Courthouse does not include all the important stuff contained in the critical sister document titled something like "Ammendments" or "Modifications".

Plug away using the search feature, you may need to set aside a day or two of "quiet time" to get through it. Google the "Penn State Marcellus Pipeline", PSU has information available to assist.

Again, upfront money is simple .... it is all the clauses required to protect you and your property that are of lasting importance.

 

All IMHO,   

                 JS 

  

Permalink Reply by Tony Yurina on January 7, 2013 at 2:13pm

If the pipeline route agreed to crosses a sensitive area such as a drive way, front yard, road, etc.  write in an addendum that specific areas will be directionaly drilled (bored under) to minimize or eliminate any surface disturbance to property.

Going rate starts a $2 per foot X diameter in inches of pipe line. Single (one) pipeline rights only.  Many folks sign multiple line rights type of easements.  Get everything you  seek in writing.  

Ask about heavy equipment crossings if you are in Agriculture. 

Double ditch method preserves top soil for restoration.

Think about future developmental use, home sights, new buildings.  

Permalink Reply by rat hole willy on January 7, 2013 at 4:38pm

i forget what they paid us for the pipeline, but make sure it is  only one gas pipe , no water pipe in the ground or above ( if u let them put a pipe in for water you may be losing money at a later date) i believe they paid us 5 dollars a foot for a temp. driveway that was never used or built. they also added 2500 dollars for each work area were they needed the right of way  to be wider then the 100'. this was needed when they made a corner in the pipeline or at the end of the driveway that they never built. then on top of that they paid us timber value .  

Mike MurphyPermalink Reply by Mike Murphy on January 7, 2013 at 4:43pm

IF A LANDMAN OPENS HIS MOUTH 9 TIMES OUT OF 10 HE IS LIEING TO YOU MAKE SURE U GET IT ALL IN WRITING AND HAVE A LAWYER REVIEW THE CONTRACT

Permalink Reply by Janice L. Hancharick on January 7, 2013 at 5:45pm

If you have a Penn State Extension office close by, stop in or give them a call.  Penn State put out a pamphlet a while back that gives more info than you're asking for, and you DEFINITELY need more info. If you don't have access to an office, put out your address and I'll mail you one. Free.  I always provide such material @ our Group meetings. In fact your neighbors should be looking @ the same pamphlet.  That pipeline runs in 2 directions.

Permalink Reply by bill on January 8, 2013 at 1:09am

Thanks Janice, that would be so kind if you could email me the Penn State Pamphlet at fortranc2003@yahoo.com

Bill

Permalink Reply by owner on January 8, 2013 at 2:29am

Be sure to do your own calculations on your footage.  The landman trying to get a ROW through my property first low balled us on the amount per foot, then they calculated the amount on about 10% less footage than we had.  Then he did not add the footage under a road which I had sub surface rights to.   Then later he told me that they paid on linear feet, since my property was on a hillside this added another 40 feet as opposed to horizontal footage.  Dont't trust them, they will try to short change you every way that they can!

Permalink Reply by Jack Straw on January 8, 2013 at 5:04am

Points well taken.

A good ROW agreement should include a requirement for Landowner to be provided with separate pre-construction and post-construction surveys performed and signed-off by a State licensed Surveyor.

 

All IMHO,

                 JS

RSS

© 2024   Created by Keith Mauck (Site Publisher).   Powered by

Badges  |  Report an Issue  |  Terms of Service