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Lease Lessons For Landowners

Farm bureau: Know your oil and gas rights

By ANNIE DIMMICK
POSTED: September 23, 2008

Article Photos


GLEN DALE - Eric Jack believes local landowners may be sitting on a fortune in oil and natural gas and wants to help them preserve and protect their rights.

Jack, president of the Ohio-Brooke Counties Farm Bureau, also wants residents to be aware of environmental concerns involved with drilling for these natural resources.

Jack and other members of the West Virginia Farm Bureau on Monday told Marshall County landowners and other attendees what they need to know when negotiating a drilling lease with oil and gas companies.

During an informational meeting at the John Marshall Center for the Performing Arts, farm bureau officials, along with oil and gas company representatives answered questions about natural resource drilling on attendees' properties and offered advice for negotiating leases.

Among those serving on a panel to provide answers were Jack, Independent Oil and Gas Operators Association Executive Director Charlie Byrd, West Virginia Oil and Gas Executive Director Corkey DeMarco, Equitable Resources Manager of Governmental Affairs Steve Purdue, Dominion Energy District Land Supervisor Greg Cunningham, Petty Oil Fields Owner Joe Petty and attorney Thomas White.

During the two-hour session, many concerns and questions were offered about water contamination in drilling areas, drill cementing, coalbed methane drilling and the ramifications of property damage, but most of the meeting focused on what landowners need to know when agreeing to allow drilling.

"These leases are a negotiation," Jack told the audience. "This is a negotiation between two parties. You've got to do your homework on this."

The topic of drilling has been a hot one for months, as Jack said many gas companies are now contacting property owners in the Ohio Valley about negotiating drilling leases. That's because the valley sits on a mapped bedrock unit of sedimentary rock known as the Marcellus Formation - a formation with high natural gas reserves.

Because natural gas is being actively pursued in the county, Jack said landowners need to be aware of their legal rights, how to determine whether they own the mineral rights to their properties and what can be laid out in a drilling agreement.

"You can carve your lease the way you want it if the oil and gas company agrees to it," said White. "There is no such thing as a form lease."

White said a company cannot drill on a property if the owner does not sign a lease; however, he added that landowners need to determine whether they own the mineral rights on the property, as surface owners who do not own the mineral rights to that property cannot stop drilling if the mineral rights owner signs a lease to drill. He also said any old drilling leases should be reviewed.

Many questioned how long natural gas drilling takes and what effects the drilling may have on neighboring properties. Purdue said that, for the most part, it's difficult to determine how long drilling would take place, as different wells have been known to produce for various periods of time. He explained that once a drilling lease is signed, the gas company meets with the landowners, surveys the land and applies for the necessary permits, then drills 24 hours a day until the well is completely drilled. He said the drilling is constantly monitored by the DEP.

As far as effects on neighboring properties and their gas reserves, Petty said those, too, are difficult to predict.

"I could drill a well on your property line, but I can't tell you that it will draw the neighboring gas," Petty said. "I can't tell you that it won't."

When questioned by one resident about how royalties are determined and distributed, Purdue said the amount of gas produced from a well is monitored by the gas company doing the drilling. But many other questions about the exact amount of royalties, the market prices for natural gas and the amount a company is willing to pay per acre garnered answers of, "I can't tell you that," or, "I don't know," from oil and gas representatives.

That didn't sit well with some in the audience, who said they are concerned about being taken advantage of.

"I think you think we are a bunch of dumb hillbillies," said one landowner. His comment prompted some applause.

While the oil and gas representatives present denied that claim, Jack reiterated that it is important for landowners to know how to negotiate a lease and discuss it with their attorney. He also handed out an informational pamphlet containing facts and tips on negotiating oil and gas leases.

 
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Member Comments
View Comments: | 1-6 | Post a comment
EJack1
09-24-08 9:02 AM
you can contact Eric Jack at ejack@3states****

EJack1
09-24-08 8:59 AM
the info can be found at ****wvfarm**** when box pops up for password just click cancel. other sites for info are ****geology**** search marcellus shale, also you should go to ****wvsoro**** for good info.

SphinxRising58
09-23-08 11:14 PM
Here is how it will goo down mos likely.

They will either drill on land someone has leased to them, & even if the people around that property does not sign, the gas or oil that may lay under the adjoining property will also get taken, or they will simply take it with imminent domain if people want too much.

MaryLynn
09-23-08 10:30 AM
It reads as though "he" is Eric Jack, president of the Ohio-Brooke Counties Farm Bureau. I'm sure the Farm Bureau is in the phone book.

oopsiambad
09-23-08 7:47 AM
He also handed out an informational pamphlet containing facts and tips on negotiating oil and gas leases.

Who is "he" and how do you get one of these?

oopsiambad
09-23-08 7:47 AM
He also handed out an informational pamphlet containing facts and tips on negotiating oil and gas leases.

Who is "he" and how do you get one of these?

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