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Tunkhancock, PA Courts where grievances will be handled

April 25, 2008 03:26 by Admin

The state does not regulate natural gas drilling leases, leaving landowners with arbitration or litigation, as well as negotiations outside of the courtroom, as means to address grievances. 

For $2 an acre, Greevey will critique a lease and provide comments and addendums. He said that he does have a minimum charge and that he would try to resolve issues by first working with a company and then through arbitration.  Greevey said that attorneys who have worked on leases "will know how far a company will go on terms."  "Information is terribly important in the leasing procedure and the more information you can get the better," Greevey added.  Some consultants primarily assist large groups, companies and investors, such as geologists Gary Lash of State University of New York-Fredonia and Terry Engelder of Penn State.

The two men have released research findings that a bed of shale known as the Marcellus, which stretches through Pennsylvania and nearby states, could contain 168 to 516 trillion cubic feet of natural gas.  "What we believe we have in our hands is intellectual property," Lash said, adding that since December a rush of people have contacted them for information. "There are probably billions of dollars at play."  Lash and Engelder charge $1,500 an hour for their services.  And while the state does not regulate leases, the state Department of Environmental Protection does watch over well operations.  DEP issues permits and monitors an operation's erosion and sediment control, among other items.

For instance, DEP has monitored drilling operations in Rush and Jessup townships, where an inspection in October 2007 discovered that an erosion and sediment products plan was not followed.  "We're trying to keep a close eye on these sites," DEP spokesman Mark Carmon said.  The sites, which are located on land owned by Dennis and Victoria LaRue, were excavated by Jay Stanton of New Albany and subcontractors for Turm Oil Co.  Stanton has filed a lawsuit against the Butler company in the Susquehanna County Court of Common Pleas and is claiming that Turm Oil failed to compensate him for work he completed at the sites in October, according to court documents.

A court hearing has not been scheduled and the attorneys representing Turm Oil and Stanton continue to file briefs.  Although a February inspection determined that the drilling operation had no violations, Carmon said that initially the site was not adequately stabilized to prevent run off.   However, waterways were not polluted, Carmon added.  In leases, landowners can include addendums in an attempt to protect a site's water supply and other interests.  For instance, Elk Lake School District in Dimock Township had an addendum protecting its water supply placed in a lease with Cabot and Oil Gas Corp of Houston.

The school district signed a lease with the company in March at $750 an acre and a 12.5 percent royalty.  Board member Chuck Place said that they consulted an attorney specializing in gas leases to develop the agreement and would first contact Cabot if a problem arises.  He added that it would be "catastrophic" if something happened to Elk Lake's water supply.


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October 6. 2008 11:41