When the Landmen Knock

During a March 12th water quality meeting for residents in Dimock, a gas industry representative admitted that his company, Cabot, hadn’t shared as much information as it could have with residents about the effects of drilling. This was no surprise to many residents of the region, some of whom have had their water ruined by the drilling.

Before companies can drill, they need to buy leases from landowners. Sometimes companies talk residents into the deals themselves. Often they hire contract companies, who send landmen to do the work.

Pennsylvania from Below spoke with three northeastern PA residents, each of whom are part of organized community responses to the drilling. Based off their own experience, and that of their neighbors, they offered advice on interacting with drilling companies and landmen.

Julie Sautner is a resident of “Ground Zero,” the nickname industry representatives and locals use for Dimock, PA. Gas companies have been drilling there for almost two years. Like many of her neighbors’, Julie’s water is undrinkable. “They’re not doing anything for us,” Julie said. “It’s been over a year and a half. I have my well bubbling, right now as we speak, like a pot of boiling water.” Recently, Julie and her husband have begun filling milk jugs with their undrinkable brown water and placing them on their property to block the trucks from entering—an act that placed them in regional newspapers. Julie is part of a lawsuit with other residents on her road against Cabot for destroying their water. Cabot denies this allegation, claiming the water was always undrinkable.  “They didn’t tell us what kind of an impact they would have,” Julie said. “No one was thinking environmental—no one was thinking anything”

Ken Long, of Sweet Valley PA, starting learning about drilling leases about two years ago. At the time, few people in his community knew about Marcellus gas. With little information out there, companies had an easy time getting leases. “There were people in their 80’s—the landmen would knock on there door and walk back out with a signed lease. They’d be getting as little as $200,” Ken said. He and his neighbors formed the all-volunteer Southwest Ross Township Property Group (SWRTPG). Together they educate local landowners and negotiate with landmen. The eight people running SWRTPG have lived in the township for more than 20 years.

Bruce Anderson, of Benton PA, has joined with his neighbors to form the Columbia County Landowners Coalition (CCLC). Like SWRTPG, the CCLC educates neighbors and negotiates with companies. Bruce explained, “you need to educate yourself to the pros and cons of the subject. I believe in dealing with a reputable company and having a good lease, heavy on environmental elements, which goes a long way in protecting you. Government agencies do not possess the manpower to effectively protect everyone, so we must look out for each other in a community effort.”

Tactics

Landmen make money when landowners sign a lease. They are trained to get you to sign that lease, According to Ken, “Anything that a used car salesman might use to get you to buy a used car,” is a tactic they might try to get your signature. Ken, Julie and Bruce shared some of the lines they’ve heard:

• “You’re not even going to be able to tell that we were here. The only thing that you’re going to be able to see is a fireplug,” the landmen told Julie. They told some of her neighbors that they might not actually drill in the area; however, since the day they started drilling, Julie has seen no end. The landmen failed to mention that Dimock sits atop the deepest and densest deposit of gas in the Marcellus shale.
• “If you don’t sign with us, we’re going to drill under your property and take your gas anyway.” According to Ken this line is illegal. He explained that such action would be called “force pulling,” which is banned in PA. If companies drill alongside your property, by law it’s called “rule of capture.”  No company has done this yet it PA, and Ken expects a big legal battle if any company tries.
• “All your neighbors have leased with us. If you don’t, you’ll just be left out.” Bruce told us, “When people have contacted their neighbors and asked them, ‘did you lease?’, they say ‘no I never talked to anybody.’ They’re using that as a tactic, and I know people who have signed leases when they were told that their neighbors have all signed them, when they hadn’t”.
• “Go ahead and sign the lease, ‘everybody’s leases are exactly the same”, they told Julie. This turned out to be false.
• “‘This offer is only good till this Friday—if you don’t sign up, we’re gone and we’ll never be back.” Bruce heard this line from a company three or four times, “And they keep coming back.”

Advice

“Don’t sign anything until you understand everything. You only have one chance to do this right. It could go on for generations and generations.” (Long). Along with Anderson and Sautner, he offered advice to anyone who hears the landmen a-knockin’.

• “First look at their ID, and get a card from them. Sit down and let them talk to you, but understand that they’re just going to give you the gas company’s perspective” (Long)
• “Ask the landsman how much up front money are they paying. Ask about lease extensions and find out what amount of royalty they are paying. Ask them if any other companies are in the area offering leases and try to verify this information. Unless you have everything important that you talked about at your meeting with the landsman in writing, you do not have it. Land service companies are here for usually a short duration of time and then they are gone” (Anderson)
• “Once you’ve got some information, then what you want to do is see if there’s a local landowner group. Join a group. Educate yourself.” (Long)
• “Talk with your neighbors and see if they were contacted and network your information. See if there are any landowners groups in your area. There are websites* that list landowner groups. Attend some meetings to gain as much knowledge as you can to make the right decision for you and your family. If you have an Internet connection, or access to a public library with a computer, there is a lot of information on the web. Knowledge is the key to successful leasing.” (Anderson)
• “If asked to sign any paperwork, advise the landsman that you want an attorney to review the paperwork before you will sign anything. Do not let them talk you out of an attorney review of the paperwork. You must protect yourself. This will give you a chance to educate yourself by doing a lot of research.” (Anderson)
• “You need to take the lease and have it looked at by an attorney, somebody who does know the oil and gas law. You need to know what they can do and what they can’t do. If they want to they can take all their trucks and park it on my property, because it says so on the lease.” (Sautner)
• “Have your water tested. If the oil company wants to test your water, let them. Tests are very expensive. If we want to have one well done independently, it’s $800 and that’s not even for all the chemicals or things that you could test for, not for $800.” (Sautner)