In Western PA, Drillers Can Drink Your Milkshake
The New York Times reports that holdouts against gas drilling in the Western Pennsylvania’s Utica Shale may find themselves being drilled anyway: Since surrounding property owners have signed drilling rights over to Houston-based Hilcorp, that company is legally entitled to take its very long straw to sip the gas out right from under the holdouts.
Houston-based Hilcorp seeks to use a 1961 Pennsylvania law to drill under the property of four holdout landowners in New Bedford, near the Ohio border an hour north of Pittsburgh. The concept, known as “forced pooling,” means that people who do not sign leases get bundled in with those who do, to make drilling more efficient and compensate all the landowners.
Hilcorp said that 99 percent of the property owners in the 3,267-acre tract have signed leases, and that drilling would occur a mile or more under the surface of the holdout’s property.
Forced pooling laws exist in some form in about 40 states and are usually used with little dispute, said Jacqueline Weaver, an expert on oil and gas law at the University of Houston. She said such laws were designed to reduce the number of unsightly drilling rigs on the surface, and to find a way to fairly compensate small landowners who lived on the edge of a “pool” of oil or gas.
That makes the law sound benign, of course. Seems like it’s being used exactly how it’s always been used: To bypass recalcitrant landowners. If it weren’t the case, we’d not have this bit of classic American cinema:
Update: An earlier version of the post suggest “forced pooling” applied in the Marcellus Shale. Officials say the law specifically does not apply there.