How Mineral Rights are Used in Fracking

When a shale company comes to actually extract the gas from lands they’ve leased, it can also cause problems. According to the Susquehanna River Basin Commission, fracking wells utilizing contemporary horizontal fracking techniques can drain liquid natural gas from 200-400 acres surrounding a single well pad (“Gas Well Drilling and Development Marcellus Shale”). A legal concept, the “rule of capture,” “states that there is no liability for drainage of oil and gas from under the lands of another so long as there has been no trespass and the individual observes all relevant statutes and regulation” (“Laws in Pennsylvania pertaining to Pooling/Unitization, Rule of Capture and Well Spacing”). If a fee simple estate owner does not want to lease his or her land and is holding out, and does not lease the mineral rights to a fracking company even though all their surrounding neighbors have, the natural gas under the land can still be fracked, so long as the wellhead is placed on a neighbor’s property. By the rule of capture, the holdout is generally not entitled to compensation from the collection and sale of the natural gas underneath their property, because it is difficult to prove exactly whose property produced the natural gas (Pifer).

Another legal tool, called “forced pooling” can force holdouts to lease their mineral rights. While the details vary from state to state, forced pooling generally allows natural gas companies to “extract minerals from a large area or “pool”—in most states a minimum of 640 acres—if leases have been negotiated for a certain percentage of that land” (Baca). Unlike the rule of capture, if forced pooling is used, each mineral rights owner is entitled to a proportion of the royalties equivalent to the proportion of their acreage leased. Forced pooling can lead to a more efficient fracking operation, as it views all the properties above a mineral deposit as accessible, and thus can place wells at the most efficient sites. In Pennsylvania, forced pooling is governed by an uncertain law from 1961, and has not been used in the current fracking boom due to its uncertainties (Legere). At least 39 states have some kind of forced pooling law on the books. A 2011 article by Propublica highlighted Joseph Todd, a man from upstate New York, whose “half-acre property…[became] part of a drilling unit [in 2009]” (Baca). When his well water became contaminated with methane, he and some of his neighbors sued the shale company who ran the well (Baca). After more than three years, U.S. District Judge Charles Siragusa decided against Joseph Todd and his neighbors, stating that they had “failed to prove the silt and methane that befouled their water was caused by…[the nearby gas wells]” (Esch). Oftentimes, property owners have little recourse outside of the courts when dealing with property right issues and fracking.