Forced Pooling for Marcellus Shale Drilling May be Coming to West Virginia Landowners

The West Virginia legislature is actively debating new legislation that regulates drilling in the Marcellus Shale. One of the provisions in the proposed legislation being hotly debated is the issue of forced pooling:

Forced pooling – which is now illegal for horizontal drilling – would allow natural gas drillers to use land they have not leased to form a well pad. For example, if all of your neighbors have signed leases with a particular drilling company but you refuse, you may be forced to allow your land to be used by gas drillers for the development of your neighbors’ gas by placing your land into a 640-acre drilling unit.

Local mineral owners have signed gas leases for amounts at least at high as $4,000 per acre and as much as 19 percent of royalties. If a mineral owner is pooled, he or she should be paid royalties comparable to their neighbors but will not receive lease money.*

The way the proposed legislation is written, if a drilling company has 75 percent of a 640-acre drilling unit leased, they would be able to force pool the other 25 percent. Opponents of the legislation believe the ratio should be more like 95/5 percent leased to force pooled.

What do you think about this issue? Is it fair to force some landowners or mineral rights owners to join in with their neighbors? Leave a comment below.

*The Intelligencer / Wheeling News-Register (Feb 15) – Forced Pooling Debated

  • Anonymous

    Hell no it is not fair…the huge money grubbing oil companies should have to negotiate with the remaining land/mineral owner interests and pay what ever it takes to get them on board.

  • Anonymous

    They do negotiate and they aren’t money grubbing.  Drilling creates: jobs, cheaper gas, and huge payouts to landowners. As an industry supporter and member I’m all for forced pooling.

  • Anonymous

    That is absolutely ludacris. If things were done that way we would not have 1 road or railway that connects the Atlantic to the Pacific. Please be real. This is one thing I will agree upon with you though – If you as a land owner do not want a rig on your property you should be able to have that right-HOWEVER, if a rig is placed within proximity of that property where a lessor would normally benefit,you should not get a dime. Either you are in or you are out at a fair and equitable price with the neighboring lessors. What one person has the right to hold up the prosperity of the many?? Another example of people who ONLY think of themselves and not the community as a whole.
    If/when you respond use a fact not an ideology to make a point.

  • Anonymous

    The companies already knew that ”Forced Pooling” could possibly be enacted before the leasing ever began. If you do your homework, you will see that the companies came in and leased up much of the large acreage first. If the large acreage had more than one owner, they would take a lease with the owner or owners who held the largest percentage and never offer, and in many cases, never even contact the remaining coowners who held the smaller percentage, in hopes of being able to ”Force Pool” them in the future. There may be an instance where a mineral owner may not be found, but the drill still is allowed to go into the ground. As for the mineral owners who can be found, these companies should be “Forced” to contact all owners initially and present an offer to the group. The biggest problem is the companies coming to terms with each other. What is really needed is “Company to Company” Forced Pooling !!!
    You will lose your right to lease your minerals on your terms. All “tax paying” mineral owners in West Virginia should reserve the ”Right to a Fair Lease” !Billions of dollars will be lost to the State and the mineral owners during the coming years of leasing and drilling !
    The companies will be able to ”Force Pool” any acreage (leased or unleased). For the unleased, pay no bonus monies and also they may only have to pay the state minimum 12.5% royalty. For the the leased, you will never get the chance to negotiate a more favorable and fair lease on your terms with addendums and separate leases for multipul parcels and formations if your poorly executed lease expires. If ”Forced Pooling” is enacted, your chances of seeing your poorly executed leases expire greatly diminish. Let alone not being able to add in addendums for protections.The companies will also be able to “Hold By Production” millions of acres by including only a portion of large and small parcels in a drilling unit ! Also, the companies have taken advantage of many unknowing mineral owners by getting them to sign over multiple parcels within the same county on a single lease, allowing the companies to ”Hold By Production” all parcels that have been included in the lease, once a well is drilled on any one parcel. If Forced Pooling is enacted, the companies will likely start applying for and drilling hundreds of verticals throughout the state so as to ”HBP” as much acreage as possible before leases expire.The companies will be able to take all gas and oil producing formations from the mineral owners. Mineral owners should reserve the right to lease each formation separately.