January 30, 2008

Legislature Taking on Surface Owner’s Bill of Rights

Barnestorming
By Sen. Clark Barnes

As anyone who’s ever spent time in our state knows, West Virginia is rife with natural resources. While our coal beds provide our most famous export, oil and natural gas deposits can be found throughout the state. Many of these are located along the Ohio River Valley, but more and more wells are being put up in the eastern part of the state, especially in the 15th Senatorial District.

As many landowners have found out the hard way, these wells are constructed on private property upon application to the West Virginia Office of Oil and Gas by a well operator with little input from the surface owner. Currently, surface owners receive only a 15-day notice to provide comments. Compensation for the land itself is limited to the loss of value based on how the land was actually used by the surface owner, not the market value.

I’ve heard from several constituents who’ve had their land intruded upon by oil or gas wells. Operators with years of experience and massive legal and technical resources can buffalo a landowner before he or she has a chance to mount a real challenge to the permit application. As a result, many surface owners feel like well operators are cutting the ground from under their feet, literally.

The problem has gone largely overlooked since 1981, when the current oil and gas laws were created. But with the ever-increasing number of wells being constructed, that could possibly change this session. The West Virginia Surface Owners’ Rights Organization has been working on a Surface Owner’s Bill of Rights, introduced Friday in the House of Delegates.

The Bill of Rights tries to even the playing field before that playing field is covered with oil and gas wells. It would give the surface owner more of a role in the well permit application process as well as increased compensation once the well is constructed.

The legislation (House Bill 4268) would require well operators to give notice before coming onto property for surveying purposes, something that doesn’t happen now. It would also require a face-to-face meeting between the driller and the landowner before the application for the permit. The surface owner would have more say in the planning process, including placement of the well and access roads. Mediation would be available if the owner and operator can’t agree on a plan.

The Surface Owner’s Bill of Rights would also make several changes to the way compensation is determined. Instead of paying owners for the actual use value of property used in the construction of the well, operators would have to pay for the market value of the land, regardless of how it was used. This compensation would also include any losses due to the construction of access roads, well sites and pipelines as well as the lost value of land adjacent to any construction. There would also be provisions for property tax reductions.

Of course, while the Bill of Rights tries to give surface owners a more proactive role in the well permit process, it doesn’t do so by sacrificing West Virginia’s oil and gas industry. The bill wouldn’t prevent energy companies from utilizing our state’s valuable natural resources. The industry provides a source of employment for many people, from surveyors to engineers to construction workers, and the Legislature certainly doesn’t want to put these people out of work.

Instead, the Bill of Rights attempts to simply balance the scale, not tip it over. As the bill works its way through the committee process, lawmakers will have a better understanding of how it will affect this balance and tweaks may become necessary before it will pass.

For now, I’d like to know what you think about this or any other issue. You can write to me at: Clark S. Barnes, State Senate, West Wing, Room 203, State Capitol Building, Charleston, W.Va. 25305. You can contact me by e-mail at cbarnes@mail.wvnet.edu. You can also call my Charleston office at 357-7973.