Lease from a Landman...

Take a look through the typical kind of lease that is being handed to landowners all over PA. The terms of this lease are filled with loopholes, ambiguities, and a lack of landowner protections.  We will be working with legal experts to annotate this lease--identifying typical kinds of loopholes, points in need of clarification and  areas of concerns.


A counterexample of a more restrictive lease can be found at the DCNR website Oil & Gas Lease Offering Page.  Here is an example of a lease currently up for bid to sell a tract of state forest land where the minimum bid is Two Thousand Dollars ($2,000.00) per acre. The royalty rate has been established at eighteen percent (18%).


If you have insights, experiences to share regarding how to deal with a basic "nonsurface oil and gas lease" like this, please contribute your comments and experiences below.

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Also know, on 31 March 2009 the Pennsylvania House Committee on Environmental Resources and Energy began consideration of an expansive piece of legislation imposing new requirements on gas drilling operators in relation to the rights of land surface owners.  The Bill proposes:

  • prior notice to surface owners prior to entry upon land for certain pre-drilling activities, 
  • notice to surface owners within one half mile of a proposed well prior to submission of a Well Permit application, 
  • plan and notice content requirements,
  • a mandatory offer to enter into a “surface use and compensation agreement”,
  • required contents of a surface use and compensation agreement,
  • a definition of required compensation to surface owners,
  • provisions for enforcing compensation obligations, 
  • a requirement to post security for compensation,
  • obligations for the restoration or replacement of polluted water supplies and a presumption of operator responsibility for pollution of water supplies within 2,500 feet of a well occuring within six months after completion of drilling or alteration,
  • a provision for recovery of attorneys fees and for treble damages in certain instances of failure to comply with the Act.

The PaDEP would be prohibited from issuing a Well Permit or renewing an existing permit if the operator is not in compliance with with the Act, placing DEP squarely into a role of protecting surface owner rights established by the bill, if enacted.

The full text of HB1155 can be viewed by clicking here.

Info Source: Marcellus Shale Watch

The below document was accidentally drop by a landman visititng an Ohio home. It give some insights into the talking points used to convince landowners to lease.

Source: Desmog Bog

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This blog post and the talking points memo that landmen to convince people to lease is worth checking out ...

http://www.desmogblog.com/leaked-talking-points-show-oil-companies-dont-give-...

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Also, http://www.marcellusoilandgas.com/

Attorney Todd O'Malley, Senior Partner at the law firm of O’Malley & Langan and Partner in the Marcellus Shale Oil and Gas Litigation Group, says, "It’s absolutely time that the people of this region receive an independent assessment of the Marcellus Shale situation, an assessment untainted by political considerations. Dr. Meiggs brings a wealth of experience to the table and can help us all get closer to the heart of the matter...help us get closer to the truth."

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