Court: Regulations Shun Landowners
Says state statutes predate the boom, must be revisited
Morgantown Dominion Post
25 November 2012
By David Beard
The state Supreme Court suggested to the Legislature that this
week it take a look at surface-owner rights — in particular,
possibly granting owners the right to appeal Department of
Environmental Protection (DEP) gas well permits.
A three-day interim session starts Monday.
State code pre-dates the horizontal drilling-hydraulic fracturing
boom, the court said, and may need to be updated.
Some local legislators said it’s uncertain at this point how the
whole body might respond to the idea.
The Supreme Court released an answer late Wednesday in the case of
a Doddridge County surface owner, Matthew L. Hamblet, who wanted
to appeal a DEP well work permit for his property.
He filed his appeal in Doddridge Circuit Court, basing his case on
a 2002 Supreme Court ruling. The DEP and Pittsburgh-based driller
EQT moved to dismiss the appeal. The court denied the dismissal
motions, but asked the Supreme Court if the 2002 case — which
applied to coal seam owners — also means state code allows surface
owners to appeal DEP permits.
The 19-page Supreme Court answer said “no” several times, but it
added this comment: “This Court urges the Legislature to
re-examine this issue and consider whether surface owners should
be afforded an administrative appeal under these circumstances.”
Legislators, stakeholders comment
Delegate Barbara Evans Fleischauer, D-Monongalia, was a member
of the joint committee that drafted the bill Gov. Earl Ray Tomblin
reworked into the Natural Gas Horizontal Well Control Act and
related measures last December.
Asked about the ruling and the court’s suggestion, Fleischauer
said she supports anything to give people a little more control of
their lives and property. How the full Legislature might respond,
though, remains to be seen.
The new House party dynamic, with the addition of 11 Republicans,
could play a part. She observed that House Republicans supported
protection measures during the bill crafting process, but isn’t
sure how the new makeup will respond.
Senate President Jeff Kessler, D-Marshall, said it was
“interesting to see the open invitation” from the court to revisit
the law. He would want to take a closer look at the issues with
his attorneys in the coming weeks before the session begins.
Noting the court’s comments that much of the code in this area is
out of date, he said the Natural Gas Horizontal Well Control Act
remains a work in progress. Since the act is still young, the
Legislature may want to sit back a while longer and see how things
play out.
And the Legislature will want to consider whether it wants to
address gaps in the act in a Band-Aid manner, issue by issue, he
said. It has tweaked other sections of code in that manner in
previous years.
The surface-owner rights the court refers to — damage compensation
and violation of lease rights — are both after-the fact measures.
In its brief, West Virginia Surface Owner’s Rights Organization
(SORO) argued that a right to appeal is more proactive, to protect
owners from “erroneous effects on their interests.” In the Hamblet
case, state requirements were disregarded, and the state waived
the requirements “without any apparent reasoning.”
SORO spokeswoman Julie Archer spoke with The Dominion Post and
drafted an email response to the decision: “This is not the
outcome we had hoped for in this case. We are disappointed that
the Court did not affirm that surface owners have a constitutional
right to appeal the state’s decision to issue drilling permits,
and that they declined to address our argument regarding surface
owners’ rights to an administrative hearing before the permit is
issued. However, we appreciate that the court has urged the
Legislature to re-visit the issue and to consider whether surface
owners should be afforded an administrative appeal. We hope the
Legislature will heed the Court’s recommendation.”
Both statewide natural gas organizations — the West Virginia Oil
and Natural Gas Association (WVONGA) and the Independent Oil and
Gas Association (IOGA) filed friend of the court briefs supporting
DEP and EQT. IOGA noted EQT’s mineral rights, and said the permit
doesn’t infringe on the surface owner’s property rights — it
restricts EQT’s rights.
IOGA President Dennis Xander said in an email, “IOGA-WV believes
the Supreme Court came to the proper conclusion. The purpose of a
drilling permit is to ensure that technical aspects of the well,
such as the size and depth of casing strings and type and
quantities of cement, are adequate to ensure safety and protect
the environment.
“The regulations provide a voice for the surface owner,” he said,
“in the form of comments, but do not provide for judicial review
of the DEP’s decisions. However, this does not limit the rights of
surface owners to seek remedies for surface damages. That is
addressed in the existing Oil and Gas Production Damage
Compensation Act, and in the surface owner’s right to file a
complaint in circuit court.
“This decision did not enlarge or diminish the rights of either
the surface owner or the driller,” he said. “IOGAWV is pleased
that the decision did not further restrict or diminish the rights
of mineral owners and their lessees.”
WVONGA Executive Director Corky DeMarco said statute clearly
grants mineral owners the right to produce their minerals in a
responsible manner, and association members have had to deal with
conflicts with surface owners.
Asked about the court’s suggestion to the Legislature, DeMarco
observed there are some contentious leases out there. He said
previous legislatures have debated the issue on numerous occasions
and he doesn’t see any value in debating it again.
DeMarco added he was pleased that the justices chose to base their
decision on code as it stands and not try to rewrite the code from
the bench.