Pa. Rep. Wants Fracking Post-Production Deductions Stopped

Law360, Philadelphia (September 4, 2013, 3:40 PM EDT) -- A Pennsylvania representative announced plans on Tuesday to introduce legislation preventing oil and gas drillers from deducting post-production costs from royalties paid to landowners, days after Chesapeake Appalachia LLC reached a $7.5 million settlement in a class action suit over the practice.

Rep. Michele Brooks, R-Crawford/Mercer, is responding to uncertainty in the state’s Guaranteed Minimum Royalty Act, which mandates that leaseholders receive at least 12.5 percent of the gas produced by a given well. In practice, the leaseholders receive payments based on the value of the...
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