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Report: Pa. attorney general widens investigation into gas royalty complaints

In this 2014 file photo, Attorney General Kathleen Kane speaks during a news conference at the Capitol in Harrisburg, Pa

AP Photo/Marc Levy, file

In this 2014 file photo, Attorney General Kathleen Kane speaks during a news conference at the Capitol in Harrisburg, Pa

Pennsylvania Attorney General Kathleen Kane is reportedly widening her investigation into complaints of fraud from gas royalty owners.

So far, the allegations have centered on the state’s biggest gas driller, Chesapeake Energy. Now sources tell Capitolwire that Kane’s office has issued subpoenas “throughout the energy industry” in Pennsylvania.

It could suggest investigators are looking for background information or that the probe also includes complaints about the payment practices of other companies.

Kane spokesman J.J. Abbott and a spokesman for the Marcellus Shale Coalition, the state’s top drilling trade group, declined to comment.

Jackie Root, President of the National Association of Royalty Owners’ Pennsylvania chapter, welcomed the news.

“We know that the issues that are out there were not solely Chesapeake,” said Root, who noted the organization has heard from numerous members who have been interviewed by state investigators.

Companies are allowed to charge royalty owners for the costs of processing and transporting gas extracted from their land.

These royalty deductions – known as post-production costs – are legal in many cases. However, landowners have complained that Chesapeake, in particular, is cheating them by violating lease terms that explicitly prohibit such deductions.

Kane announced the probe in February after receiving letters from Gov. Tom Corbett and state Sen. Gene Yaw (R-Bradford) calling for a formal investigation into allegations about Chesapeake.

In May, Corbett told StateImpact Pennsylvania the problems of “that one company” were not endemic to the industry.

When asked about the possibility Kane could be broadening the scope of the investigation, spokesman Jay Pagni said the governor “would expect that she would look into any improper practices.”

In March, a state House committee approved a bill aimed at limiting the ability of companies to charge post-production costs. The measure faces strong opposition from the oil and gas industry, which regards the fees as a legitimate business practice.

Root is optimistic legislators will move on the bill when they return to Harrisburg this fall.

“Every day that ticks away with that legislation not happening is another day that landowners won’t be able to recover their royalties.”


  • Victoria Switzer

    I will be very surprised if our elected officials hold the gas companies to the law stating the royalty can not be less than 12 1/2 percent. Other issues like the falsification of notarization of leases, intimidation, coercion, lying should all be investigated but I am certain they will not be. If a company starts out by lying and misleading and coercing, how does it suddenly become a good neighbor? Maybe our elected officials expect nothing better from the gas industry. Maybe they are still afraid the gas industry will leave PA and go back to WV.

  • Paula

    Chesapeake has been pumping off our well for almost a year… we have received $0.00(zero) to date. Every month they tell us that “they will get the paperwork sorted out and should be paying us no later than next month”. …and there is no one to help us get our money. They just keep pumping. If I did this, I would be in jail!

  • Johnnie


    Smells like the Mafia-Costa Nostra-Federal Judiciary- Keystone-The 3′rd
    Circuit. I don’t feel any sorrow for you people in Bradford
    County…NONE…..You have a known Mobster as your Federal Representive
    that is on the MAFIA Payroll and you elected him 2 times, once this
    month. The Mafia and the Judiciary are known Crooks and have been for
    over 100 years, they will steal your gas and your property…BECAUSE
    THAT IS WHAT THE MAFIA DOES FOR A LIVING and when the Judiciary and
    State Government is criminal you are dead.

    Poor Emil Wagner owner of Mount Airy
    Lodge got a bullet in the head when they stole his property “Suicide they
    say” look at the history of Oaktree Capital Suicide-Suicide-Suicide
    Suicide From New Orleans to Texas to California to Pennsylvania . these are
    PENNSYLVANIA; easy to find they are the ones with the robes.
    You are a victim of FRAUD in the highest degree and.

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