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Senate of Pennsylvania
Session of 2017 - 2018 Regular Session


Posted: December 20, 2016 09:50 AM
From: Senator Gene Yaw
To: All Senate members
Subject: Company to Company Integration
Integration is the combination of multiple oil and gas interests into a land unit where all parties share in well ownership and/or royalties in proportion to the amount of land their tract contributes to the whole unit. For example, a tract containing 20 acres in a 1,000 acre unit would comprise 2% of the entire unit and be allocated 2% of all production, sales proceeds, costs and expenses.

I intend to re-introduce legislation, Senate Bill 313 of last session, that enhances conservation efforts and protects landowners affected by the ongoing development of the Marcellus Shale. This legislation will achieve multiple compelling policy goals outlined below.

I have always been an avid believer in property rights. My legislation would only impact properties with mineral rights leased or sold to a natural gas company. It would NOT impact a landowner who has decided to not extract the resource from their property. It is my opinion, all landowners have the right to participate if they so choose. They should not be forced.

An integration act for Pennsylvania’s Marcellus Shale will provide environmental benefits by encouraging development of the resource using horizontal drilling techniques.

What an integration act does for the Pennsylvania Marcellus Shale:
  • Encourages multiple horizontal wells from a single drilling pad, significantly reducing the surface impact of drilling
  • Provides for orderly development of the Marcellus Shale
  • Maximizes recovery of the natural gas resource
  • Insures that landowners are treated fairly
  • Provides environmental benefits by encouraging development of the resource using horizontal drilling techniques.
What an integration act avoids:

  • Chaotic, overlapping development efforts
  • More drilling pads than necessary
  • Overlapping gas gathering pipelines
  • Stranded acreage that can never be efficiently drilled
  • Loss by some willing landowners to have their natural gas developed due to disagreements between companies

My legislation will provide a fair and open process for establishing units owned or leased by companies and obtaining approval from the Commonwealth for each unit after all interested and affected parties have had an opportunity for their views to be heard. In addition, before the state approves any integration unit the applicant will be required to already control a super majority of the gas interests within the proposed unit.

My legislation will achieve at least these important policy goals and I urge you to join me as a co-sponsor.

Introduced as SB142