1Amending the act of July 20, 1979 (P.L.183, No.60), entitled "An 
2act regulating the terms and conditions of certain leases 
3regarding natural gas and oil," further providing for
4definitions, for payment information to interest owners and
5for conflicts; and providing for joint ventures and for
6inspection of records.

7The General Assembly of the Commonwealth of Pennsylvania
8hereby enacts as follows:

9Section 1. Sections 1.2, 3.2(1) and 3.4 of the act of July
1020, 1979 (P.L.183, No.60), known as the Oil and Gas Lease Act,
11added July 9, 2013 (P.L.473, No.66), are amended to read:

12Section 1.2. Definitions.

13The following words and phrases when used in this act shall
14have the meanings given to them in this section unless the
15context clearly indicates otherwise:

16"Check stub." The financial record attached to a check.

17"Division order." An agreement signed by an interest owner 
18directing the distribution of proceeds from the sale of oil, 
19gas, casing head gas or other related hydrocarbons. The order
 

1shall direct and authorize the payor to make payment for the 
2products taken in accordance with the division order.

3"Interest owner." A person who is legally entitled to
4payment from the proceeds derived from the sale of oil or gas
5from an oil or gas well located in this Commonwealth.

6"Lessee." A person that has obtained the right to explore,
7drill, stimulate, produce, market or sell oil, gas or natural
8gas liquids pursuant to an executed lease.

9"Lessor." An owner of oil and gas in place that controls the
10oil and gas rights and executes a lease granting the right to
11explore, drill, stimulate, produce, market or sell oil, gas or
12natural gas liquids.

13"Mcf." A unit of measurement expressed by 1,000 cubic feet.

14Section 3.2. Payment information to interest owners.

15Whenever payment is made for oil or gas production to an
16interest owner, whether pursuant to a division order, lease,
17servitude or other agreement, all of the following information,
18at a minimum, shall be included on the check stub or on an
19attachment to the form of payment, unless the information is
20otherwise provided on a regular basis:

21(1) A unique property identification and the name, 
22number or combination of name and number that identifies the 
23lease, property, unit or well or wells for which payment is 
24being made; and the county in which the lease, property or 
25well is located.

26* * *

27Section 3.4. Conflicts.

28If there is [any] a conflict between a division order and an
29oil and gas lease, the terms and conditions of the oil and gas
30lease shall control. A division order may not amend or

1supplement the terms and conditions of an oil and gas lease.

2Section 2. The act is amended by adding sections to read:

3Section 3.5. Joint ventures.

4In the case of a joint venture, interest owners shall be
5provided the following information related to a joint venture
6company on an annual basis:

7(1) Name of company.

8(2) Company address.

9(3) Company telephone number.

10(4) Each joint venture decimal interest.

11Section 4. Inspection of records.

12(a) Authority.--A lessor or a person acting on behalf of a
13lessor may inspect the records of a lessee.

14(b) Procedure.--

15(1) A lessor or a person acting on behalf of a lessor
16seeking inspection under subsection (a) must make a written
17request for inspection of records for any property for which
18the lessor has been paid royalties within the three-year
19period immediately preceding the date of the request.

20(2) Within 30 days of receipt of the request, the lessee
21shall do all of the following:

22(i) Designate a location in this Commonwealth for
23inspection which shall not impose an unreasonable travel
24burden on the lessor or the lessor's representative.

25(ii) Designate a date for inspection:

26(A) as mutually agreed; or

27(B) within 90 days of receipt of the request.

28(iii) Designate a time for inspection which is
29reasonable to permit completion of the inspection.

30(iv) Provide supporting documentation of payment

1information required under section 3.2 for services that
2are provided by third parties. Supporting documentation
3shall consist of invoiced amounts for the services
4provided, but shall not include the composition of the
5fees charged by an unaffiliated third party.

6(v) Make available a knowledgeable individual who is
7able to answer questions pertaining to accounting issues
8regarding a well which is the subject of the request.

9(c) Confidentiality.--

10(1) Except as set forth in paragraph (2), information
11provided to a lessor or person acting on behalf of a lessor
12that makes a request under subsection (a):

13(i) shall be confidential; and

14(ii) may not be disclosed to any other person.

15(2) Paragraph (1) does not apply to disclosure in a
16judicial proceeding.

17Section 3. This act shall take effect in 60 days.