Shale Gas Mineral Rights Case Appealed to PA Supreme Court

We have a new development in the ongoing case from Susquehanna County, PA where a lower court upheld the “Dunham rule” declaring oil and gas are not part of mineral rights.  The Dunham rule, a PA law precedent that’s been in place since 1882, was challenged by PA Superior Court (see this MDN story), threatening to overturn dozens if not hundreds of leases and deeds in Pennsylvania. The landowners in the case have now appealed directly to the PA State Supreme Court in an effort to lay this to rest and have the Dunham rule upheld.

A case raising doubts about whether Pennsylvania’s booming natural gas industry has the right to extract the methane from the thick shale more than a mile beneath countless properties is being appealed to the state’s high court.

A Susquehanna County couple on Friday asked the Supreme Court to reinforce that a nearly 130-year-old ruling applies to the Marcellus Shale, which lies underneath much of Pennsylvania and is considered the nation’s largest-known natural gas reservoir.

The appeal was motivated by a lower Superior Court action last month suggesting that perhaps the 1882 case cannot be used to separate mineral rights from gas rights in the case of the Marcellus Shale.

"Even if it was unintentional, the Superior Court did call it into question, perhaps not intentionally, but inadvertently, call into question longstanding law on what the term ‘mineral’ means," said Gregory Krock, a Pittsburgh lawyer representing the couple. "But you also have to realize the case is at an early stage."

The Supreme Court must decide whether to hear the appeal.*

*Binghamton Press & Sun-Bulletin (Oct 11, 2011) – Susquehanna County couple challenges shale gas contracts; case heads to Pa. high court