Bradford County farmer gets gas royalty checks for $1.10 and 10 cents

[modrepub]

TOWANDA — A Bradford County farmer says he recently got a $1.10 royalty check from Chesapeake Energy for the natural gas taken from two well pads on his farm in the Sayre area.

That is not what Glenn Aikens said he was promised when he signed a lease to allow drilling on his farm. He claims he was promised the royalty would never drop below 12.5 percent of the sales price of the gas produced.

<snip>

Besides the recently received $1.10 royalty check, he said he got one for 10 cents last June.

As a member of the Bradford County Planning Commission for more than 30 years, Aikens said he fully understands what the Marcellus Shale natural gas development has meant to the county.

He also is one of many property owners with natural gas leases who claim drilling companies, especially Chesapeake, are cheating them out of their guaranteed royalty minimums.

Link: http://lanctalk.com/Forums/index.php/topic/224301-bradford-county-farmer-gets-gas-royalty-checks-for-110-and-10-cents/

First these people want to cut the bureaucracy so they can get the gas companies in, then they want to use the bureaucracy to "make them whole" when they get cheated. I almost want to laugh at them. Caveat emptor

[Hoppy]

1. Modrep, good analysis of the situation

[Squinch]

2. Like my nana used to say: lie down with dogs, wake up with fleas.

[JPZenger]

3. Typical Check

Royalty you are owned under lease of your farm $20,000
Your share of our lobbying and political contribution costs -$5,000
Cost to install a toxic waste impoundment on your farm -$14,995
-------------------------
Your net royalty check $5

[smiley]

4. I grew up in Bradford County PA

But I now live in Colorado. When I go home to visit relatives my heart breaks when I see the destruction to the natural environment. And this is only the beginning.

[PADEMLeftie]

5. Min royalty act of 79

PA passed a law that royalties could not be less than 12.5 percent. This issue got taken to pa supreme court, but since production costs is not defined in the law, the court ruled the industry can interpret it anyway they want. So they can deduct whatever they want from the 12.5, and call it production costs. Insane, just insane. But, hey the Rs will tell you how this has helped struggling farmers