By March 28, 2015 Read More →

Mineral Rights Owners Are at a Disadvantage

March 1, 2015. The Intelligencer / Wheeling News-Register.

As usual, the greed of producers in “mineral forced pooling” overshadows reason, resulting in the complete sacrifice of a mineral owners’ rights. Unfortunately, the rights of mineral owners that logically go along with ownership haven’t been entirely addressed.

Legislators must realize how unfair it is to force production by using the producers’ logic as a guideline. Mineral owners’ rights will never be equitable until a long list is considered. A principal consideration should be “drain laws,” which I don’t believe exist in West Virginia. Absence of these laws can only be described as the producers’ legal right to the theft of unleased energy surrounding the production unit. Enacting such rules will not change the state’s revenue. However, the mineral owner, who may or may not have signed, will be drastically impacted by the fact that un-leased properties near produced units may never be leased or legally produced. This tangled web of legislation, along with its complexities, cannot be simplified by reducing the whole pie into the single solution referred to as “forced pooling.”

It is an insult to refer to mineral owners as “hold outs.” There simply needs to be a clear line of sight to a reasonable agreement. When that line of unobstructed sight is established, there will be no need for this very controversial legislation. The thousands of acres leased near the beginning of the 20th century and held by production today already give the producer all rights of production, except the right to pool to produce. These documents in perpetuity already give the producer the freedom to fully retain their 87.5 percent share while charging the mineral owner outrageous production fees. Those producer freedoms drop the 12.5 percent to sometimes 5 percent to 6 percent of share. This is far from the 18 percent referred to in your article, which is generally without post-production expenses. Producers can’t be granted further rights to rob and pillage at the expense of the mineral owner. The lion’s share of this legislation would be used to allow producers to pool old leases that currently don’t have the right to pool within their wording, thereby sealing the low profit share of the mineral owner.

The majority of us, unfairly labeled as “hold-outs,” are the victims, not the perpetrators. Please don’t do us any more favors by simplifying such a complex issue and assuming that the greed of the mineral owner has initiated this legislation because it is quite the contrary. I ask that you please use your stage to reveal to legislators that the producer has already been granted the farm, and the mineral owners would like to be heard from now. Legislation needs to allow for negotiation of the terms, of those numerous old leases, to bring them into the 21st century.

E. Stanley Glover

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