Let’s assume you own 105 acres in Greene County, Pennsylvania. In 2020, you signed an oil and gas lease with ABC Exploration. During the negotiations, you agreed that only those post-production costs which actually...more
5/29/2025
/ Appeals ,
Class Action ,
Commercial Leases ,
Contract Disputes ,
Contract Interpretation ,
Contract Terms ,
Land Owners ,
Leases ,
Mineral Leases ,
Natural Gas ,
Oil & Gas ,
Property Owners ,
Royalties
Let’s assume you own a 175 acre farm in Washington County. Your grandfather acquired the farm back in 1948 from Farmer Brown (the “1948 Deed”). Your grandfather always said that he bought both the surface and oil and gas. In...more
As we approach the 20th anniversary of the Marcellus Shale play, one issue remains constant: the ongoing debate over the deduction of post-production costs. Landowners all across Pennsylvania have spent countless hours...more
12/20/2024
/ Deductions ,
EAP ,
Land Owners ,
Leases ,
Lessee ,
Lessor ,
Mineral Leases ,
Oil & Gas ,
Postproduction Costs ,
Royalties ,
Well Drilling
Let’s assume that you purchase a 105 acre farm in Greene County in 2022. You purchase only the surface estate while the seller, Farmer Jones, retains the underlying oil and gas rights. You intend to grow corn and winter...more
9/13/2024
/ Appellate Courts ,
Covenants that Run With the Land ,
Farms ,
Land Owners ,
Leases ,
Mineral Rights ,
Oil & Gas ,
Pipelines ,
Surface Owner ,
Texas ,
Well Drilling
Let’s assume you own 95 acres in Greene County, Pennsylvania. In 2019, you signed an oil and gas lease with ABC Exploration. During the negotiations, you agreed that only those post-production costs which actually...more
9/26/2023
/ Deductions ,
Land Owners ,
Leases ,
Lessee ,
Lessor ,
Marcellus Shale ,
Mineral Leases ,
Oil & Gas ,
Pipelines ,
Postproduction Costs ,
Processing Fees ,
Product Enhancements ,
Royalties ,
Shale Gas ,
Well Drilling
This is a familiar yet troubling question. Imagine you own 135 acres in Washington County. You have received offers from several oil and gas drillers but have not yet signed a lease. Your neighbor, however, did sign a lease...more
As we have written about before, a troubling issue facing landowners in the Marcellus Shale region is the practice of retroactive pooling and unitization. Retroactive pooling and unitization occurs when a driller records an...more
Let’s assume you own 125 acres in Greene County, Pennsylvania. A landman from XYZ Gas Co. approaches you about a new oil and gas lease. The lease purports to grant XYZ Gas Co. exclusive drilling rights to the Marcellus...more
Many Pennsylvania oil and gas leases have what is commonly known as a “market enhancement” royalty clause (“MEC”). These MEC leases typically prohibit the deduction of any post-production costs that are incurred transforming...more
Many Pennsylvania landowners have leases with “market enhancement” royalty clauses. These clauses typically prohibit the deduction of any post-production costs that are incurred transforming the gas into marketable form. Once...more
Let’s assume you own a 93-acre farm in Tioga County. In 1986 your grandfather sold the oil and gas rights to his neighbor, John Mize. In the early 1990’s, Mr. Mize signed an oil and gas lease with XYZ Drilling. Several years...more
10/17/2022
/ American Rule ,
Carbon Capture and Sequestration ,
Carbon Emissions ,
Compensation ,
Consent ,
Land Owners ,
Leases ,
Mineral Leases ,
Oil & Gas ,
Private Property ,
Surface Owner ,
Underground Injection Wells
Let’s assume that you own 125 acres in Tioga County. In 2017, you negotiate a new oil and gas lease with XYZ Drilling. During the negotiations, you insist on a “gross royalty” which prohibits the deduction of...more
Let’s assume you own 114 acres in Tioga County Pennsylvania. In 2012, you signed an oil and gas lease with XYZ Drilling. Two years later they drill and complete the MUSKIE #1H Well. The royalty clause in the 2012 lease...more
2/25/2022
/ GMRA ,
Leaseholds ,
Leases ,
Oil & Gas ,
Oil Wells ,
PA Supreme Court ,
Payment-In-Kind ,
Pipelines ,
Postproduction Costs ,
Royalties ,
Well Drilling