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Fracking and Alternative Energy

Steptoe & Johnson PLLC: Pa. Gov. Corbett Signs Act Providing for Mandatory Disclosures in Royalty Statements

Pennsylvania Governor Tom Corbett signed SB 259 on Tuesday, July 9, 2013. The legislation requires natural gas producers operating in Pennsylvania to standardize all deductions listed on royalty check payment stubs. More specifically, producers must include well identification information, the net value of total sales after deductions, the owners' interest in sales from the lease, and the total amount of severance and other production taxes and other permitted deductions on royalty statements provided to their lessors. The legislation does not authorize forced pooling but clarifies that operators can cross lease lines to develop the gas under existing leases and provides clarity with regard to the allocation of royalty among royalty owners. The legislation becomes effective September 7, 2013.

To view the bill in its entirety, click here.

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