State Senate unanimously approves gas royalty bills

The state Senate unanimously approved two bills Wednesday that aim to give more protections to people who earn royalty money from oil and gas drilling. Both bills were approved by the Senate last year but died in the House.

SB 147 would require drillers to disclose more information on royalty check stubs. It would also grant landowners the right to audit companies’ records to ensure proper payment.  SB 148 would bar oil and gas companies from retaliating against people who raise questions about their royalty payments. Sen. Gene Yaw (R- Bradford) is the prime sponsor of both measures.

“These bills will give landowners more weapons to use in their arguments with the gas drilling companies that pay their royalties,” Yaw said in a statement.  “We’ve tried to provide them with the tools that they can use to determine the accuracy their royalty reports.”

Royalty-owner advocates have praised the measures, while the state’s largest gas industry trade group, the Marcellus Shale Coalition, has not taken a position on either bill.

A spokesman for the House Republican caucus wouldn’t say whether there would be more interest this year, only that the House Environmental Resource and Energy Committee will review both measures.

Rep. Garth Everett (R-Lycoming) has been pushing a more controversial royalty bill in the House, which would limit the ability of oil and gas companies to charge landowners the fees associated with processing and transporting gas. Some landowners have complained drillers are fraudulently charging exorbitant fees, leaving them with little to no money. Everett wants to strengthen and clarify a 1979 state law, which requires drillers to pay a minimum 12.5 percent royalty.

Everett doesn’t think there is resistance to Yaw’s royalty bills in the House. He says they just got lost in the shuffle last year.

“They got introduced kind of late, and things were getting bogged down,” says Everett. “I don’t think the industry has any particular opposition to them. They’re providing administrative ways for landowners to get some answers from companies.”

Everett plans to re-introduce his royalty bill in the House in the near future, however it’s faced strong opposition from the gas industry, which argues it’s unconstitutional because it would change the terms of existing contracts.

 

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