At the end of March, West Virginia’s Senate voted to authorize natural gas producers to drill when three fourths of those with royalty rights agree and a reasonable effort has been made to negotiate with the remaining owners of a property. The bill was approved with a vote of 19 to 14. The West Virginia Oil and Natural Gas Association has commented that the law reflects current technology and that the state of West Virginia is ready for major gas development. This vote came after a three-hour meeting of the West Virginia senate two days after companies, industry trade groups, and natural gas law firms brought hundreds of workers to speak in support of the bill.
Details of the Bill
The bill in question, SB 576, is designed to make it easier for natural gas companies to work despite the protests of unwilling co-owners of minerals. SB 576 also imposes modern horizontal drilling techniques despite leases written years before these types of drilling methods were even imagined. During horizontal drilling, gas companies drill both down and horizontally which allows the companies to capture gas from a larger area. SB 576 also allows drilling of multiple contiguous leases with horizontal drilling rights provided that the leases do not expressly prohibit horizontal drilling.
Supporters of the Bill
Natural gas companies have long desired this legislation. One senator who supports the bill claims that the bill was passed because West Virginia legislature has finally responded to royalty owners who have leased rights and desire such a bill to be passed. Supporters of SB 576 argue that that the legislation is necessary for natural gas companies to pool sufficient amounts of gas.
Opponents of the Bill
The bill is opposed by the West Virginia Surface Owners Rights Organization, which argues that the bill enables out-of-state gas producers to take mineral owners’ property for the benefit of shareholders. The president of the Farm Bureau referred to the bill as a “total betrayal” of the property rights of West Virginians. Other land and mineral owner groups have expressed concerns about the legislation. Opponents of the bill even held a news conference at the time that the measure was scheduled for potential amendments and a vote on passage. The news conference was organized by lobbyists who represent Shiben Estates Incorporated, a land and mineral firm based in New Martinsville. Opponents of SB 576 argue that the gas industry is attempting to use legislation to endorse modern drilling techniques that would undermine land rights.
Obtain the Assistance of Skilled West Virginia Attorney
West Virginia’s legislature has listed only one amendment to be considered for SB 576, which would allow unwilling mineral owners who are forced into gas pools to obtain a review from West Virginia’s Oil and Gas Conservation Committee. For individuals in the energy business, including natural gas, it is a wise idea to retain the assistance of legal counsel who has in-depth understanding of the natural gas business. Contact the law firm of Hendrickson and Long, a West Virginia law firm dedicated to protecting the rights of those companies involved in the energy industry.