By KEN WARD JR.
Charleston Gazette-Mail
CHARLESTON, W.Va. — As time starts to run out for this year’s legislative session, oil and gas workers descended on the Capitol Tuesday morning to get lawmakers moving on the latest legislation to help natural gas companies force minority mineral owners to allow drilling.
Several hundred workers gathered for what was billed as a “West Virginia Jobs Energy Rally,” just hours before the Senate Judiciary Committee had been tentatively scheduled to take up a committee substitute version of the industry-backed bill.
Andrew Blaney, an EQT Corp. land man in Monongalia County, said he rode to Charleston with a group of co-workers to show support for continued growth of the natural gas industry in the state’s Marcellus Shale region.
“This is what can build this state up,” said Blaney, 24, a Morgantown native who attended Fairmont State University.
Several oil and gas companies provided buses to bring workers to the rally from Doddridge County, Bridgeport, Jane Lew and Parkersburg. Lawyers, lobbyists and other professionals who work for oil and gas companies also made a strong showing at the event. One local law firm, Steptoe & Johnson, distributed white T-shirts that said, “Energy Fuels WV Jobs.”
“We’re at a crossroads in West Virginia,” said Rebecca McPhail, president of the West Virginia Manufacturers Association. “Time is short, and we urge West Virginia legislators to move forward quickly.”
A string of lawmakers, industry officials and business owners took to the stage for the event, promising to help the natural gas industry, calling gas production a path to economic prosperity and improved manufacturing related to shale-gas byproducts, and agreeing that the state’s current regulatory and legal structure gets in the industry’s way.
Jason Hall of Hall Drilling, in Ritchie County, said he felt fortunate when the Marcellus boom allowed him to move back to his native state and help grow a small family company into one with nearly 400 employees and a $20 million annual payroll.
“I had my roots here all along,” Hall said. “I just needed the opportunity.”
Senate Energy Industry and Mining Committee Chairman Randy Smith, R-Tucker and a coal company official, told the workers from a rival industry that theirs is the future of West Virginia.
“Coal has carried this state, and we need help,” he told those gathered. “We need someone else to carry this state forward, and gas is the future. There’s no doubt about that.”
So far this session, one of the gas industry’s key bills, to overturn a West Virginia Supreme Court decision that blocked pipeline land surveys without landowner consent, has yet to emerge from committee. That bill was discussed — and strongly questioned by many lawmakers — during a House Energy Committee meeting on Feb. 23. The measure has yet to be put back on the committee’s agenda.
Another gas industry bill, to provide an exemption to the state’s new chemical storage tank safety law, appears headed for passage. But the House-approved version greatly narrowed the scope of the regulatory relief.
Tuesday afternoon, members of the Senate Energy, Industry and Mining Committee approved the House bill, which still exempts 2,300 tanks — all located within a “zone of peripheral concern” within 5 to 10 miles of a drinking water intake — from state regulations. Committee members asked no questions of the legislation lawyer who explained the bill. There was no discussion. The committee approved the measure by a unanimous voice vote. It goes now to the Senate floor.
The 60-day session technically ends on April 8, but bills are due out of committee in the house of origin by Monday, to ensure three full days of readings by March 29, which is the last day to consider a bill on third reading in the house of origin.
The gas industry’s top priority — a forced pooling bill of some sort — has yet to emerge from committee in either house. Members of the Senate Judiciary Committee had been scheduled to take up the issue Tuesday afternoon, but the discussion was postponed until today, amid reports that yet another version of the bill was going to emerge.
Maribeth Anderson, a lobbyist for Southwestern Energy, has told lawmakers that a bill to protect the majority of mineral owners is a key for the gas industry and for West Virginia’s economy.
“Protections for the minority are important,” Anderson said. “Protections for the majority are important. Especially in this state, where we need more production and more tax revenue, we just have to decide if we want to protect the rights of the majority who favor development.”
Industry officials say they need the bill to be able to assemble larger mineral tracts for drilling. Opponents say the measure is a taking of private property and also gives surface owners little protection from drilling on their land.
Two years ago, a forced pooling bill died on the last night of the 2015 session in a rare tie vote. Last year, the measure never gained steam during the session, following a Gazette-Mail story that detailed ties between natural gas drilling and the bill’s major legislative advocate, then-Delegate Woody Ireland, R-Ritchie.
On Friday and Saturday, the Senate Judiciary Committee spent several hours hearing from various interest groups about the latest version of legislation on that issue.
Senate Bill 576 contains a “co-tenancy” provision that allows drilling over the objections of a co-owner of mineral rights unless that co-owner owns at least a third of those rights. It also allows modern horizontal drilling through older leases written when that technology wasn’t used, unless those older leases somehow specifically prohibited the practice.
The current version of the bill, a committee substitute, takes out earlier language that would have allowed such horizontal drilling only if the company involved had an agreement with the surface owners about how the drilling would be performed.
The committee substitute is supported by oil and gas companies but is opposed by groups representing some mineral owners, surface landowners and the powerful West Virginia Farm Bureau.
“All we ask is that we be treated fairly and that our property rights be protected,” Farm Bureau President Charles Wilfong said. “This bill does neither.”
The West Virginia Surface Owners Rights Organization called the committee substitute for SB 576 “one of the worst bills introduced yet” on forced pooling.
During an appearance at Tuesday’s rally, Gov. Jim Justice repeated his support for giving the industry a forced pooling bill.
“I will not stand in your way,” Justice said. “I will not hinder you.”
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