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Scott J. Waldron, www.scottjwaldron.com

Royalties bill is getting second chance

Pennsylvania Representative Garth Everett (R-Lycoming) is giving his royalties bill a second chance.

Measure House Bill 1391 is directed towards Pennsylvania landowners and making sure they receive fair royalty payments from natural gas operations.  Everett introduced the bill last year, but unfortunately once it was approved by the House committee it never made it to the floor for voting.  Everett believes that if the bill would have made it to the floor it would have been successful:

It’s being held up in strategic places by strategic people– the leadership in the Republican caucus … We just need to convince them. There are so many of us in favor of the bill, they’re obligated to allow us to take it to the floor.

The state representative reintroduced the bill, which is supported by 37 co-sponsors from both parties, on Tuesday during an event being held at the Capitol rotunda.  As reported by State Impact Pennsylvania, the bill “is an attempt to address complaints that some gas companies are cheating leaseholders out of royalty money. Drillers have been accused of charging people exorbitant fees (known as post-production costs).”  These fees include the cost of processing and transporting natural gas through pipelines and compressor stations.  Due to the royalty payment issues, several lawsuits have been filed and are now effecting leases for public land at state and local jurisdictions.

These include the expenses of processing and transporting gas through pipelines and compressor stations. The royalty problems prompted numerous lawsuits and have also affected leases of public land at the state and local divisions.  State Representative John Maher (R-Allegheny) explained that overall he believes the industry has acted appropriately when it comes to royalty payments.  However, he did mention there are certain companies who have persisted on “giving the industry a black eye and being unfair to our neighbors.”

While a state law created in 1979 does guarantee landowners a minimum of 12.5 percent royalty from oil and natural gas wells, several people are receiving far less due to the high exorbitant fees.  Eric Place, a resident of Susquehanna County, is one person who is dealing with this exact issue. According to Place, he feels he has lost more than six figures in royalty payments.

The first time Everett introduced H.B. 1319 the gas industry lobbied against it.  The Marcellus Shale Coalition said it is still reviewing the new draft, and made the following statement:

It’s important to recognize that post production-related issues — which have been extremely localized and not widespread — are being actively addressed in the courts where contract matters should be addressed.

According to State Impact Pennsylvania, “House Speaker Mike Turzai (R- Allegheny) says his chamber has not dealt with the royalties issue lately because it’s currently busy negotiating a state budget, which is due June 30th.”

Everett explained his plan was to get the newest version of the bill filed before legislators left for the summer.  He also mentioned he has plans to do a “full court press” this fall.

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