BUYER BEWARE

A professional geologist shared advice for property owners during a natural gas exploration and leasing seminar held Saturday in Shinglehouse, a hotbed of recent activity.

William A. Capouillez was invited back after a standing room-only crowd turned out for his previous seminar in Shinglehouse.

He is suggesting that landowners form property groups to negotiate with those who are seeking leases.

Stephen Rhoads, president of the Pa. Oil and Gas Association, echoes that advice. He suggests that landowners deal only with reputable companies, rather than brokers who seek to acquire rights and then pass them on to the producers.

Many experts agree that property owners should engage the services of an attorney to protect their rights.

Property owners should also be wary of a "standard lease."

"There is no such thing," said Chris Miller, a minerals manager with the New York Dept. of Environmental Conservation.

A lease is a negotiated legal document and if a landowner doesn't like the terms of the lease, he shouldn't sign it, Miller said.

Penn State Cooperative Extension Educator Tim Pierson said a landowner should request separate leases or contracts and payments for: shallow oil and gas; deep oil and gas; minerals; and any rights-of-ways for roads, pipelines or utilities.

Placement of wells, roads, tanks, gates, fences, pipelines, and other aspects of drilling and production can also be determined by the landowner.

Pierson noted that water quality protection is important and usually requires addendums. Before any activities and again after all development and production activity occurs, water wells and developed springs should be tested, he advised.

A landowner who signs a lease will get a bonus, a rental fee and, if gas is discovered, will receive a royalty of about 12.5 percent of the value of the gas. Annual lease payments are usually negotiable and vary widely from five to hundreds of dollars per acre. Some landowners have been able to negotiate the royalty to 18 percent.

Some who own surface rights may not own the oil, gas and mineral rights. In those cases, the owners of subsurface resources have the right to drill on private property.