Update on forced pooling/unitization; and plugging; and inspectors

The most significant oil and gas/surface owner/mineral owner legislation to come out of the Legislature earlier this year was the new forced pooling/unitization statute.  (Technically it is the “unitization” part that affects us, and pooling is about fights between drillers, so we will compromise with popular terminology and use the slashed term “pooling/unitization”.)

The bill was very good for surface owners.  It does not allow forced use of the surface!  And after a certain number of years, if the missing/unknown/abandoning mineral owners do not show up, the royalties they would have received, PLUS title to that share of the minerals, passes to the surface owners!  We think it could have been better for mineral owners, but considering makeup and potential makeup of the Legislature and the sway of industry, we were OK with its provisions for mineral owners. 

We have a new web page for mineral owners who have been threatened with forced pooling/unitization.  If  you want to know more about WVSORO’s reasoning for being OK with the bill go here.  It explains why, IF there is going to be natural gas drilling, long horizontal well bores from centralized pads enabled by forced pooling are the best way to go.  For general information on leasing/lease amendments, click here.

There are two next big issues that WVSORO is working on.

First, heaps of federal money is coming to the State to do plugging of orphaned wells!  Hooray!  To understand why plugging (not “capping”) wells is important and why it is so easy and tempting for pluggers to take shortcuts, we have put a new slide show on the web site. We are concerned whether the State’s management of these funds and lack of oversight of pluggers could cause some plugging jobs to not be done right as the result of shortcuts.

Which leads us, second, to the delusionally inadequate number of oil and gas inspectors.  There were 18 (1 for every 4000 wells) when a scientific study showed that 53% of 70 active, conventional wells in 13 counties were leaking 9 cubic feet of methane — an hour.  The Legislature has since cut the number of inspectors to 9  (1 for every 8000 wells).  These inspectors are responsible for 75,000 known existing wells, 28,000 associated tanks, 15 horizontal rigs now operating in West Virginia, and they will soon be responsible for watching over all the plugging contractors working in six regions pursuant to the federal money.

Be alert if we send out an alert asking you contact your legislators on these issues!

Let us know if you have questions!

Dave McMahon