Previous - Slide 32 Next

VI. Why hasn’t the West Virginia Legislature passed well spacing and royalty sharing legislation for all wells in West Virginia?

There are enough people and entities and interests that oppose it, perhaps for different reasons, that they readily form a formal or informal coalition against the needed legislation.  And many of these are people and entities and interests that have a history of, and are experienced in, influencing the Legislature and the Executive.  Efforts to require well spacing and royalty sharing, and pooling of operating duties and expenses, rarely even get off the ground.

There is well spacing and royalty sharing in West Virginia for statutory deep wells because it is extra expensive to do the geology  and drilling of a deep well.  Big drilling companies, like Exxon, do not want their deep wells “offset”.  They tried to get pooling and unitization in West Virginia more than 30 years ago.  They were successful, but only in getting it for their deep wells.  Very few wells are drilled down below the Onondaga formation, about 6000 feet deep, so that they would qualify as deep wells under the statute.  (There is no real, scientific reason for the distinction between deep and shallow wells at this level.  It was just a political compromise.)

There is also well spacing and royalty sharing in West Virginia for shallow wells that go through coal seams – when the coal seam owner objects.  That is because the coal industry is influential enough to get protection for them selves.  Mineable coal seams are almost always shallower than the strata containing natural gas.  So almost all gas wells have to go through the coal seam to get to the gas.  Coal operators cannot mine close to active gas wells that go through their shallow coal seams because it is too dangerous.  So they want gas wells spaced out so there will be fewer wells through their coal seams, leaving more coal to mine in between.  So they were able to get the Legislature to pass laws protecting their interests.

Fourth, we have a statute that allows forced well spacing for "secondary recovery". Additional oil or gas can be produced from a field of wells that have already been drilled but no longer produce enough oil or gas. Water or other substances are forced down some of the wells and produced up other wells to wash more oil or gas out of the formation. This has particular technique has concerns for surface owners and environmentalists that are eyond the scope of this presentation.

There is well spacing and royalty sharing in West Virginia for coal bed methane, in part because of the influence of coal, and in part because coal bed methane laws were enacted later.