OH Bill Requires 3rd Party Verification of O&G Production

Two Ohio state Democrat representatives have introduced a new bill that would require an “audit clause” to be recorded in every oil and gas drilling lease in the state. The bill is an effort, according to its authors, to insert third party verification of production numbers reported by companies so landowners don’t have to rely on the driller’s “honesty” in reporting those numbers.

Reps. John Carney, D-Columbus, and Mark Okey, D-Carrollton, have introduced House Bill 528 that would establish an oil and gas production audit clause to be included in every lease recorded in the state.

The bill is designed to assure that landowners get correct monthly production numbers from drillers.

Most leases contain no audit rights for landowners, forcing them to rely on the honesty of the energy companies, Carney and Okey said.

The bill is expected to be referred to the Agriculture and Natural Resources Committee.*

*Akron (OH) Beacon Journal (May 5, 2012) – Ohio legislators seek audit production clause