|Legal Showdown Coming on New York State's Compulsory Integration Law
A legal showdown is coming on compulsory integration -- or forced pooling -- in New York State. In addition to all the other questions raised about high-volume hydraulic fracturing, it appears that the industry-written law, passed without a public hearing in 2005, is not applicable to shale formations.
If the state's compulsory integration law is declared unconstitutional, that means landowners who prefer not to sign gas leases cannot be forced into drilling units. Since similar industry-written laws exist in nearly 40 states, that raises questions about the legal vulnerability of those laws.
The existing New York law also treats property owners who willingly sign shale gas drilling leases differently from landowners forced into drilling units. This unequal treatment ranges from lower royalty rates, denial of a signing bonus, potentially high financial risk penalties including paying a percentage of actual well costs, and other liabilities.
But the 2005 law, as written, does not apply to gas-bearing shale deposits, according to William C. Fischer, described as a “forensic” investigator, by Attorney Helen Slottje. Slottje is Managing Attorney at the Community Environmental Defense Council (CEDC) in Ithaca, NY. CEDC is a public interest law firm founded by Helen and David Slottje.
If, as some expect, New York Governor Andrew Cuomo’s Department of Environmental Conservation (DEC) issues permits for horizontal hydraulic fracturing, a legal challenge will follow to have the compulsory integration law struck down as unconstitutional.
According to Attorney Helen Slottje, “We’re focused on a court challenge [to compulsory integration].”
“We will seek a declaration from the court that the compulsory integration statute itself is unconstitutional and needs to be struck down.”
Check out the details in "Compulsory Integration Not Applicable to Shale" at this link: http://www.spectraenergywatch.com/blog/?p=1779
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