Tuesday, January 22, 2013

Lawmakers May Give Consideration To Lease Integration Issue During 2013 Legislative Session

The biggest impediment to the orderly development of the Marcellus and Utica shale formations in West Virginia is the inability to deal in a timely manner with non-participating minority mineral owners.  This can be due to missing or unknown owners or know owners who just won’t participate.  These non-participating  minority owners, who cannot be compelled to participate in a lease or if they are leased cannot be compelled to modify lease to provide for pooling, are preventing the orderly development of WV’s gas resource.  The resulting sterilization and waste is contrary to the stated public policy of het state.  This also negatively impacts surface owners and the environment because pad locations and the extension of laterals are dictated less by geology and topography and more by how to avoid unleased or unpooled tracts. 

To find a resolution, interested parties have been meeting in West Virginia and discussing lease integration to deal with pooling and other administrative processes to deal with non- participating minority mineral interest owners.  They also are doing this in advance of the start of the 2013 West Virginia legislative session, which begins in earnest on February 13, 2013. Given the continued development in Ohio, this is expected to be the session when West Virginia lawmakers give careful consideration to the reality that non-participating minority ownership interests are impeding development in West Virginia.

Lewis Glasser Casey & Rollins PLLC and its government relations affiliate, LGCR Government Solutions LLC, have been actively involved in these meetings and will be monitoring this issue closely during the 2013 legislative session.