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Corbett defends new drilling law

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By Timothy Puko
Thursday, July 11, 2013, 12:01 a.m.
 

Gov. Tom Corbett on Wednesday defended legislation he signed into law this week that critics say will undercut some landowners in lease negotiations with Marcellus shale gas drillers.

The new law, which was tacked onto legislation to clarify information on gas royalty payments, empowers oil and gas drillers to combine land into larger drilling units as long as a property owner's lease doesn't prohibit it.

It effectively forces people with existing contracts to allow their land to be pooled into larger drilling units without having full power to negotiate better deals in return, legal scholars and landowners advocates have said.

In a letter to lawmakers, Corbett said he believes the new law enhances the efficiency of drilling for oil and gas while limiting environmental damage and protecting the rights of landowners and leaseholders.

“We're going to have to have a difference of opinion,” Corbett told the Tribune-Review. “It does not empower a company to take gas from an individual who has not signed a lease. People are trying to use the term forced pooling. It doesn't do forced pooling. You cannot take from somebody who has not signed a lease.”

That's false logic, countered George Jugovic, a senior attorney at Citizens for Pennsylvania's Future, reiterating comments from several of the law's critics. The provision may apply only to people who have gas leases, but those people still have a legal right not to allow their land to be pooled into larger drilling units, they said.

The change likely will affect Western Pennsylvania most, because many people here hold old oil and gas leases that don't mention that type of pooling, experts have said. Now drillers want to combine those lands so their horizontal wells can go sideways to tap shale gas from several properties at once.

“Who would know (Corbett) was from southwestern Pennsylvania? Could be a reason he has a 26 percent approval rating,” said Jugovic, a former state environmental lawyer who resigned early in Corbett's tenure. “He's either ignorant or lying. One's the truth. I'm not sure which is worse.”

Landowner advocates have criticized not only the effect of the provision but the way it passed. It was two sentences in a five-page bill drafted primarily to get better information to royalty recipients that received overwhelming approval in weekend votes at the end of June.

Marcellus shale wells can be drilled on land that was leased for the traditional, shallow oil and gas wells drilled in western Pennsylvania in the decades before a boom began in 2008, the bill's proponents say.

However, those leases had no provision in them to allow a drilling company to extract gas through horizontal well bores that extend from an adjacent property. The new law gives that power to drilling companies, instead of forcing them to ask the permission of the landowner.

Jugovic called a lawsuit inevitable. The Pennsylvania chapter of the National Association of Royalty Owners — a group that supports drilling and defends landowners — is already contemplating a legal challenge, its vice president Trevor Walczak said.

Timothy Puko is a staff writer for Trib Total Media. He can be reached at 412-320-7991 or tpuko@tribweb.com. The Associated Press contributed.

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