Gas Leases

One nice thing that has come out of this gas lease boom is the number of people and groups who have gone out of their way to try and help educate people. With that said here’s another article full of great advice for people considering leasing their land.

Get all the facts before signing a gas lease.

That’s the message being spread by the Pennsylvania Landowner Alliance (PALA), which has been holding a series of meetings to educate property owners on how to obtain the best lease terms with gas companies.

The PALA advises all people not to sign a gas lease until they understand the legalities.

Jason Mendicino of PALA recently spoke to a group of landowners at the Fayette County Fairgrounds.

Mendicino said education and organization is key when negotiating with gas companies, noting that there is power in numbers.

The PALA is composed of an alliance of landowners who own the gas and oil rights to their property and have joined forces to increase their negotiation power.

“The more the merrier,” Mendicino said, noting that leverage increases considerably when property owners band together.

Mendicino said he and his brothers, Michael and Dominic, are recruiting property owners in Fayette, Greene, Washington and Westmoreland counties to form a southwestern Pennsylvania alliance.

PALA reports that hundreds of people have joined the alliance since the first meeting, which was held in late June, noting that thousands of acres of land are already registered.

More than 11,000 acres of land were registered with PALA as of earlier this month, Mendicino said, noting that the PALA hopes to have more than 20,000 acres before the July 31 sign-up deadline.

“By joining the alliance you align yourself with likeminded individuals who have a common goal. There is power in numbers when you’re trying to obtain the best terms and money with the gas companies,” Mendicino said.

Mendicino said gas companies are in the business of making money and that their goal is to acquire the right to drill for the lowest possible price.

“If you sign a bad lease, they can’t be blamed. There’s no enemy here but ignorance,” Mendicino said. “You can get out of a bad marriage, but you can’t get out of a bad lease.”

Mendicino said the first gas well was dug in 1821 and was 27 feet deep. Today gas wells are dug in excess of 35,000 feet, he said, noting that technology keeps surface disturbance at a minimum and allows for more production.

People who own their gas and oil rights could be sitting on a “modern-day gold mine,” he said, noting that landowners must make sure the lease agreement they sign offers them the best possible deal.

Mendicino said people need to be aware that they don’t have to accept the first offer a gas company gives them and said they should have an attorney review the lease agreement before signing.

PALA will negotiate with gas companies on behalf of those who registered beginning Aug. 1, Mendicino said, noting that negotiations are expected to last between four and six weeks. Landowners will then be given the opportunity to accept or reject the lease agreement.

[Via The Herald Standard]