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Natural gas royalties bill backers push for quick passage


Charleston Gazette-Mail

CHARLESTON, W.Va. — Nearly two weeks after a natural gas royalties bill was moved from the West Virginia Senate’s Energy, Industry and Mining Committee to its Judiciary Committee, property rights advocates held a news conference Monday morning to try to push the bill forward.

Senate Bill 360 seeks to eliminate post-production expenses, such as transportation or severance taxes from royalty owners’ checks. The proposed legislation would reverse the so-called “Leggett Decision” — the state Supreme Court’s ruling last year that reversed its 2016 decision to allow natural gas drillers to deduct post-production costs from royalties owed to mineral owners. The court reheard the case after Justice Beth Walker replaced Justice Brent Benjamin.

A 1982 law updated terms on “flat rate” leases and called them “wholly inadequate compensation.” Instead of small, flat rates, companies would now have to pay royalties amounting to one-eighth of gains from that site to the mineral owner. Before the case was reheard, the initial Supreme Court ruling decided that companies couldn’t deduct post-production costs from those royalties.

S.B. 360, advocates say, will right what the Supreme Court did and make sure money will stay in mineral owners’ pockets in West Virginia and not go to large, out-of-state companies.

Charles Clements, R-Wetzel, said he introduced the bill after seeing mineral owners try to figure out what was being taken out of their royalty checks.

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