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Landowner Protection Bills Approved

April 8, 2014- Hanson Quickel
HARRISBURG – Three bills expanding the rights of landowners who are currently leased with natural gas companies were approved today with strong bipartisan support by the full state Senate, according to prime sponsor, Senator Gene Yaw (R-23).

The legislation, known as the Oil and Gas Lease Protection Package, aims to provide more protections for landowners. 

“This three-bill package aims to level the playing field in favor of Pennsylvania landowners who are looking for fair treatment when leasing their land,” Yaw said. “Hopefully, these bills, along with other legislative and investigative efforts that are presently underway, will resolve many of the royalty issues which have been brought to the attention of local legislators. I’m sure the House of Representatives will also see the merit in approving this legislation.”

The first bill, Senate Bill 1236, would expand upon the Oil and Gas Lease Act by allowing royalty interest owners the opportunity to inspect records of natural gas companies to verify proper payments. In addition, the bill requires all royalty payments be made within 60 days of production unless otherwise stated in the contract. Any delinquent payments are to be paid with interest.

The second bill, Senate Bill 1237, would prohibit a gas company from retaliating against any royalty interest owner by terminating their lease agreement or ceasing development on leased property because a royalty interest owner questions the accuracy of current royalty payments. Companies found to have violated the provisions of this act face civil penalties of up to $1,000 per day.

The third bill, Senate Bill 1238, would require a gas company to record a surrender document in the county Recorder of Deeds office where the oil and gas well is located within 30 days upon expiration, termination, or forfeiture of an oil and gas lease. The surrender document will release the gas company’s interests in the oil and gas. This is similar to what a mortgage company would be required to do after a mortgage was paid in full.

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