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Forced pooling bill stalls in WV Legislature

WHEELING, W.VA. — For the fifth time in six years, a bill to allow forced pooling of Marcellus Shale natural gas rights has stalled in the West Virginia Legislature.

Wednesday is “crossover day” – the day on which a bill must advance from its house of origin to be considered in the opposite chamber. Delegate Pat McGeehan, R-Hancock, a staunch opponent of forced pooling, said this is not going to happen.

“This is not going to be on the agenda. They knew there would have been stiff opposition to this,” McGeehan said. “To me, this is just government price-fixing and eminent domain.”

Forced pooling, also termed “lease integration,” would allow drillers to pull gas from beneath unleased land in cases when a mineral owner cannot be located or refuses to sign a lease. Under the proposed West Virginia bill, forced pooling would be allowed if a driller leases at least 80 percent of the acreage in a proposed unit.

Corky DeMarco, executive director of the West Virginia Oil and Natural Gas Association, maintains certain mineral owners are not receiving the maximum amount of profit for their oil and natural gas because of drilling units that must exclude certain parcels of property.

“I do not think there is an appetite for it,” DeMarco said Monday regarding the legislation’s prospects. “I don’t want to speculate why, but it is an election year. There is no sense in running the bill if the leadership does not think it can pass.”

DeMarco blames a lack of understanding about how the proposal would actually work. He admits there likely would not be enough time for that now.

During the 2015 regular session, a bill to allow the practice failed to pass after 49-49 tie vote on the final day.

“I don’t know if we’ll try again,” DeMarco said of whether industry leaders would push for a similar bill in the future.

DeMarco said the issue is much more of a problem in the northern portion of the state because there are so many small parcels of land. Some lease agreements on record in Northern Panhandle courthouses are for tracts smaller than 0.1 acre.

Delegate Shawn Fluharty, D-Ohio, said he was glad to work with McGeehan in a bipartisan manner to halt the pooling legislation.

“For far too long, our state has been bought and sold to the highest bidder with the best lobbyists. This issue was bigger than political parties. It was about the people of West Virginia,” Fluharty said.

Gov. Earl Ray Tomblin has approved coal and natural gas tax breaks.

The Democrat signed a bill Monday dropping severance surtaxes of 56 cents per ton of coal and 4.7 cents per thousand cubic feet of natural gas.

They’ve helped pay a workers’ compensation debt for years.

Tomblin proposed dropping them July 1, or earlier at his discretion. The Republican-led Legislature passed Tomblin’s bill.

Until July 1, the money can help cover this year’s $384 million budget gap.

Tomblin’s administration expects the cut to reduce coal revenue by $51.5 million and natural gas revenue by $58.1 million for the 2017 budget.

A Senate panel gave initial approval Monday to dropping coal’s overall severance tax from 5 to 4 percent in July 2018, and 3 percent in July 2019.

The Senate has voted down a bill that would have let surveyors for natural gas pipelines enter people’s private property without permission.

Senators voted 23-11 to kill a bill Monday that says letting surveyors for natural gas companies on people’s property is in the public interest.

The legislation would have required trying to get consent to go on someone’s property. Companies would also have to send a notice of their intent to perform studies on someone’s property.

The bill would not have required or prevented landowners from being present when surveyors were on site.

The bill was one of several aiming to help natural gas companies in West Virginia.

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