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CPBJ Extra Blog

Transparency is good, but larger issues — and possible new one — remain in gas royalty rankle

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Three cheers for Gov. Tom Corbett signing Republican state Sen. Gene Yaw's legislation, Senate Bill 259, calling for transparency through a detailed and standardized accounting of deductions that come out of the checks gas companies cut to landowners who are owed royalties in Pennsylvania.

Questions have surfaced about such deductions from checks cut to landowners who have signed lease agreements. They feel they are not getting what they thought they would in royalty payments.

As a journalist, I say transparency is never a bad thing. But knowing about something is only the first step in righting a potential wrong. If I knew a truck was headed right toward me and I never bothered to move, then knowing wouldn't have done a darn bit of good, right?

With that same logic in mind, if gas company X tells John Doe that the company is keeping substantial portions of his royalty check for this, that and scores of other reasons, does it really help the finances of the Doe family at all? Do they end up with any more money in the end than when they were completely in the dark?

My guess is the answer is no. And that's not good enough when the real answer here is whether the deductions are proper in the first place. So, this is a great first step, and I welcome Yaw's comments that he wants to continue discussions on the issue and what more has to be accomplished.

However, there's also a bit of a wrinkle in the legislation, namely a provision reportedly allowing gas companies the power to pool, or combine, some leases, according to StateImpact Pennsylvania.

Landowners, whom the transparency measure was aimed at protecting, are concerned it will undermine their ability to negotiate with companies, according to the reporting.

I guess in Pennsylvania, even one step forward can't come without another step back.

Brent Burkey covers retail, tourism, and Lebanon and York counties. Have a tip or question for him? Email him at brentb@centralpennbusiness.com. You can also follow him on Twitter, @brentburkey.

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