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New Minimum Royalty Rates

by Elizabeth Alford on January 18, 2017

Just days before President Obama is set to leave office, he released new shale regulations establishing minimum royalty rates and giving the Secretary of the Interior discretion for increases.

Related: BLM: New Rules Will Ensure Accurate Royalties

The ruling is designed to protect the environment and ensure that taxpayers are fairly compensated, should shale on federal lands ever be drilling commercially.

“This approach allows the Secretary to consider all relevant factors, including geology, technology, costs, and market prices for oil and gas. Until there is a domestic commercial oil shale industry, we can only speculate about what royalty rates those factors would support. (…) These regulations also strengthen environmental protections by requiring additional environmental information and planning to be included in an oil shale development plan, including a plan to protect water resources, an airshed review, an integrated waste management plan, and an environmental protection plan.” – BLM statement

The new amendments add flexibility to the royalty rates that were set in 2008. The BLM rejected a call for a minimum 12.5 percent rate as an alternative, which is what is imposed on conventional oil and gas leases. In a statement, the agency noted there the “significant differences” between oil shale mineral deposits and conventional crude oil reservoirs. They called the effects of any uncertainty about flexible royalties small compared to the financial and technical challenges of producing fuel from shale at prices competitive with conventional oil production.

Read more at blm.gov

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West Virginia Mineral Owners Coalition

by Elizabeth Alford on January 11, 2017

The West Virginia Mineral Owners Coalition is mobilizing forces to protect landowner rights.

Related: Clarity Needed for West Virginia Royalties

The 2017 legislative session in West Virginia is under way and being closely watched by mineral rights owners in the state. At the beginning of the month, the West Virginia Mineral Owners Coalition gathered its members to strategize how they would protect their rights.

“We are trying to keep the industries in this state from stealing our property rights,” said Wayne Johnson, a mineral owner in Ritchie County. “Taking from our statutorily protected royalty payments is theft.”

The coalition exists to mobilize and support property owners and they plan to lobby legislators in 2017 to maintain and continue those protections they won in 2016. Two West Virginia Supreme Court cases upheld mineral and landowner rights:

  • Mountain Valley Pipeline vs. McCurdy: the Supreme Court supported a lower court’s decision that pipeline companies cannot trespass onto your land, without your permission, to survey for interstate projects that have not yet been granted eminent domain.
  • Leggett vs. EQT Production Company: the court held that the state’s minimum royalty payment of 12.5 percent must be paid without the deduction of post-production costs. This decision upheld statutory protections put in place to protect the interests of mineral owners who have leased their minerals. EQT has asked the court to rehear their case on this issue.

For more information check out the Coalition’s Facebook page or contact Elise Keaton at 304-207-1150 or email wvmineralowners@gmail.com.

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2016 Year in Review for Oil & Gas

January 2, 2017

Looking back over 2016, it seems that some relief may be in sight for the oil and gas industry after over two years of riding out low oil prices. Some highlights of the last year include: – Oil prices hit a 13-year low of $26 a barrel in February 2016 and ended the year over $50 a […]

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Clarity Needed for Royalty Deductions in West Virginia

December 26, 2016

The fight over whether post-production fees can be deducted from royalty statements continues to play out in West Virginia Courts. Related: West Virginia Bill Seeks Transparency for Mineral Owners Royalty statements can be confusing, with owners not always knowing why they are being charged. Gas companies might deduct money for transportation, loss of gas and even marketing the […]

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North Dakota Tackles Confusing Royalty Statements

December 19, 2016

North Dakota mineral owners who are confused by complicated royalty statements may soon get some relief. Related: Who Owns Mineral Rights Under North Dakota Lake? The North Dakota Industrial Commission is moving to strengthen state requirements for royalty statements after a plea from recently retired legislator, Bob Skarphol. Skarphol want to require oil and gas companies to do […]

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EPA Releases Fracking Assessment

December 15, 2016

The U.S. Environmental Protection Agency (EPA) has released its final report assessing the impact of hydraulic fracturing activities on drinking water resources. Related: EPA Introduces a Competition to Increase Air Quality The EPA’s comprehensive drinking water study was initiated by Congress in 2009 in order to study the relationship between hydraulic fracturing for oil and gas […]

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Landowners Lose Negligence Battle in Texas

December 14, 2016

The Texas Supreme Court sides favors oil company over landowners in a three year old negligence case. Related: Texas Mineral Owners Sue Marathon Oil Michal and Myra Cerny from Karnes County, TX have been fighting for years to gain compensation for the suffering they claim from the oil and gas activity on their property. The couple alleges […]

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West Virginia Mineral Owners Sue Stone Energy over Royalties

December 7, 2016

Mineral owners file suit in West Virginia, claiming Stone Energy Corporation withheld royalty payments. Related: Texas Mineral Owners Sue Marathon Oil Two lawsuits were filed earlier this month against Stone Energy Corp in. The plaintiffs, Calvin D. Lechliter and Mary L. Lechliter; and John Jennings and Mollie Toppe, claim their 2009 lease contracts are invalid because Stone […]

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Wyoming & Montana Oppose BLM Ruling

December 5, 2016

More states are pushing back against federal overreach of oil and gas activities by the Bureau of Land Management. Related: BLM: New Flaring Regulations Proposed Wyoming and Montana have petitioned for a review of the latest BLM ruling published in November, which imposes air quality regulations and seeks compensation and royalties for any oil and gas […]

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Environmentalists Concerns May Halt Oil and Gas Lease Auction in Texas

November 24, 2016

Concerns over earthquakes might interfere with an upcoming North Texas lease sale if environmentalists have their way. Related: Texas on Short List for Fracking-Induced Earthquakes The Bureau of Land Management plans to hold an auction for oil and gas leases on federal land in Texas next spring. But several environmental groups have banded together to ask the […]

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