Lease & Royalty Payments

As MDN told you three weeks ago, Pennsylvania House Bill (HB) 1684 has hit some turbulence on its way to quick passage (see PA HB 1684 Guaranteed Minimum Royalty Act Hits a Snag). The bill, as originally introduced, was supported by the PA chapter of the National Royalty Owner’s Association and would provide for landowners to receive a minimum 12.5% in royalties, disallowing some of the shenanigans Chesapeake Energy has engaged in with reducing post-production expenses via a back door (see PA NARO Alert: Tell Your State Rep to Vote YES on HB 1684).

But along the way the drilling industry objected–rather loudly–saying lease contracts signed by two parties, the landowner and the driller, should not be modified by the legislature (see Rare Schism Between Landowners & Drillers over PA Royalty Law). Since the original bill, a number of amendments have been proposed, one of them that may well get adopted, that would fundamentally gut the intention of the bill to provide a minimum 12.5%. Lawmakers debated HB 1684 and amendments last week–before adjourning and heading out of town for a 3-week recess (wish we had a 3-week vacation whenever we wanted!). Here’s a status report and update on what happened last week and where things now stand with HB 1684…
Read More “Status Report on PA Royalty Bill HB 1684 – Recess Limbo”