Royalty payments cause concern


Concerns about natural gas royalty payments were brought to light at the Wednesday, July 24 meeting of the county commissioners.

Gloria DiGirolamo said that with the gas companies taking the readings at the wells, there is no way to prove exactly what royalty-owners should be paid.

“They can not give us a formula,” DiGirolamo said. “Without (a formula) we can’t find out if we’re being ripped off or not.”

She also said that Senate Bill 259 – recently signed into law by the governor – did nothing to address the underlying issue. She also suggested pursuing the matter through Securities & Exchange Commission regulations.
SB 259 requires royalty check stubs to include production taxes and deductions taken from the royalty payment but does not protect the royalty owners from the production costs.

Earlier this summer, Susquehanna County Commissioners passed a resolution requesting the legislature to define the state’s “guaranteed minimum royalty” set at 12-1/2 percent advising that post-production costs should not part of the minimum royalties paid to property owners.

Commissioner Michael Giangrieco said that a 2010 Pennsylvania Supreme Court decision noted the legislature should better define “guaranteed royalties.”
“None (of the legislators) stepped up to the plate,” Giangrieco said.

The commissioner said that Sen. Gene Yaw had said that existing contracts could not be amended.

Some of the early leases signed in the county did not provide for royalty payments without post-production costs. Many leases written more recently keep the gas companies from charging a portion of the post-production costs back to the landowner.

Giangrieco said he had worked with Rep. Sandra Major on the issue in 2008. “There was no support from anyone to look at it then,” he said.

The commissioner said he felt SB 259 hurt the landowners even more.

“Who’s looking out for the landowners?” he questioned. “It should be our elected officials who are supposed to be looking out for us.”

“Whose pockets are being taken care of,” questioned DiGirolamo.

“Nothing has been passed in favor of the landowner,” replied Giangrieco.

Jackie Root, of NARO-PA (National Association of Royalty Owners of Pennsylvania), said the grassroots group has now hired a consultant in order to have “boots on the ground” in Harrisburg.

“We’re the only ones out there making the argument (for the royalty owners),” Root said.

Root said there are over 150,000 royalty owners but she feels the group’s role was marginalized when SB 259 was drafted.

According to Root, NARO-PA plans to hold town hall style meetings and coffee shop talks over the next few months for its members.

Another audience member, Edna Paskoff said she had spoken with Rep. Tina Pickett’s office regarding the “rule of capture.”

Paskoff said she was advised to hire an attorney to determine if she should be receiving any royalties from nearby gas drilling.

“Now I have to employ an attorney,” Paskoff said, adding the person’s she spoke with said to her, “Good luck in your pursuit.”

Vera Scroggins, also in attendance at the meeting, asked why none of the legislators had come forward on the issue.

“Call them,” Giangrieco said. “They think they’re doing a wonderful job.”
But DiGirolamo wasn’t just at the meeting to discuss royalties. She also spoke about the nine-mile drilling moratorium still in place in parts of Dimock Twp.

“It’s locking up landowners that are not even close to (Carter Rd.),” she said.

  • shotzie

    Thank you Staci for your immediate and informative coverage on the above issues. All Royalty owners are in need of help and in need of more knowlegde, by larger numbers involved we can assist each other to fight all upcoming battles together. Wether you are not included in having deductions taken from your checks, not receiving any forms of payment, or feeling that this will never get resolved, please realize that there will always be an issue that will impact us individually in one way or another. There are many that feel that they cannot fight the state or the gas companies, and with that , they are winning as they want you to feel that way. We are allowing the Gas Companies to make decisions for us as well as the Senate, and or Congress. The Representatives that we voted in are there for us, they were brought in on an honor of a campaign they ran, promises they have spoken and we should have them available to rectify these issues as this is their job. They had the ability to clarify the laws, they knew the Gas Companies were coming in to do work, they issued the permits, but they state that we are to go out and hire private attorneys to fix what they messed up for us and good luck doing that. Act 259 that was pushed to get signed hurt us very much, the landowners are being left with no rights and it will continue with one more issue after another. Naro will be holding meetings soon in our areas and they need more members to join, the issues they are fighting are for all of us, please take the time to look for these meetings and attend and join. When issues arise, the first thing the State wants to know is who is your group and how many numbers are in your group, this is wrong but they do it, so if we are a small group we mean nothing to them. This is a constant with the state and it is not how any of us should be treated, so this shows you what we are up against, lets take time to join together and continue to grow as one group for the rights of our land.

    Thank you,