Local lawmakers help draft gas royalty legislation
Area lawmakers have co-sponsored legislation to make natural gas companies accountable for royalty payments made to landowners with drilling leases.
State Reps. Garth Everett, R-Muncy and Matthew E. Baker, R-Wellsboro, are two of the House members behind the legislation drafted in response to concerns by many landowners that their royalty payments have decreased due to post-production costs.
Everett said some landowners who signed leases indicating they would receive one-eighth of the value of gas from their properties didn’t realize they would suddenly not receive their fair share.
“There are a couple of companies that are being hard on landowners. In some cases, it’s beyond unfair,” Everett said. Neither of those companies, he said, are operating in Lycoming County.
A 1979 law, which precedes the discovery of the Marcellus Shale, guaranteed a minimum royalty payment of one-eighth for oil, natural gas or gas of any other designation.
Everett said when some people signed leases with companies, they were told not to worry about a lot of language contained within the documents.
“All we’re saying is they should get at least the minimum royalty payment,” Everett said, noting that he’s received a number of complaints from constituents about the issue.
Baker said it’s an issue that affects many residents in the state’s Northern Tier.
Other co-sponsors of the bill are state Reps. Sandra Major, R-Montrose, and Tina Pickett, R-Towanda
Some companies have attempted to reduce royalties by transferring post-production costs to landowners. When deducted, the final payments have often amounted to royalty shares of less than one-eighth, or about 12.5 percent.