What’s a Fair Price for Running Pipelines Through Your Property?
The landowners in Tyler County, WV who sit along the proposed route of Energy Transfer Partners 800-mile, $4.4 billion pipeline, called Rover, to connect the Marcellus/Utica region with the Midwest and Canada are asking for one thing: a fair price. According to one landowner, they’ve received an offer from ETP that’s about 1/3 of where it should be. Problem is, if landowners don’t accept ETP’s offer, once the Federal Energy Regulatory Commission (FERC) approves the pipeline, ETP can then use eminent domain to simply take the land it needs and pay the price it wants to pay. Landowners’ only recourse at that point is to ask a court to arbitrate a price. No, we’re not fans of eminent domain–it’s an imperfect concept for an imperfect situation in which some hold-out landowners remain unreasonable. But that doesn’t excuse lack of a fair price. So what price has been offered and what do landowners think is a fair price to receive?…
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Southwestern Energy is on a tear in the Marcellus/Utica region. In 2014, the company picked up 413,000 acres and some 1,500 wells from Chesapeake Energy for $4.975 billion and paid another $394 million to Statoil as part of that same deal (to get more ownership of the jointly-owned acreage); Southwestern purchased all of WPX’s acreage–46,700 acres and 63 Marcellus Shale wells–in northeast Pennsylvania for $300 million; and Southwestern cut a deal with DTE Energy to significantly expand their pipeline gathering system in northeast PA. They’ve also been busy in several other shale plays. On Monday, Southwestern issued a company update and guidance for 2015. The very notable thing about that update: Southwestern, contrary to almost every other major and minor shale player, is increasing spending on shale drilling in 2015, by $200 million…