1 / 19

Planning for Gas Leases

Planning for Gas Leases. Planning For Gas Leases. Daniel S. Dineen, Director of Planning Cortland County Planning Department 37 Church St. Cortland, NY 13045 ddineen@cortland-co.org (607) 753-5043 FAX (607) 753-5150. Exploratory drilling.

Patman
Download Presentation

Planning for Gas Leases

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Planning for Gas Leases

  2. Planning For Gas Leases • Daniel S. Dineen, Director of Planning • Cortland County Planning Department • 37 Church St. • Cortland, NY 13045 • ddineen@cortland-co.org • (607) 753-5043 • FAX (607) 753-5150

  3. Exploratory drilling • Has been occurring for several decades in other parts of the country • has recently become an issue in the northeast • has not been incorporated into zoning laws in NYS but other areas of the country have developed land use regulations

  4. Gas leases • Contractual agreement • binding document establishing time, price, and any other conditions of the lease • gives the energy company access to the site, the right to prepare the site as needed, and to drill on the site • landowner receives compensation on a per acre leased basis

  5. Gas lease • Term of lease • shorter lease equals smaller payments • if exploratory program is not over, the lease can be renewed or the gas rights revert to the property owner • EXCEPTION - if gas is found during the lease period, the operator retains their rights to the gas for as long as the well is productive

  6. Gas lease • Advantages • lease fee • if successful • owner receives compensation as a % of gas produced • may be allowed to tap into the gas reserve for life of well

  7. Gas lease • Disadvantages • disruption of land : building of roads, removal of trees, topsoil, vegetation, etc. • erosion due to clearing of land • possibility of leaking of drilling fluids into the ground • noise • equipment storage

  8. Gas lease • Lessee is required to reclaim the site to the extent possible (topography, vegetation, etc.) • Purchase of Development Rights program • if property has a conservation easement, can not enter into a gas lease • gas lease can only exist if entered into prior to placing property into conservation easement

  9. Gas Lease • Factors to consider before signing lease • check references • check with neighbors • negotiate lease payment • negotiate term of lease • damage settlement • negotiate location of well, storage tanks, access roads, pipelines,etc. (Pipelines should be buried below plow depth)

  10. Gas Lease • Negotiate a ‘free gas’ clause • limit total combined acreage of gas lease • limit the storage of hazardous materials on site • disposition of well once it is no longer in use

  11. Gas leases • Other considerations • drilling rig will run 24hrs. a day 7 days a week • can affect wells in rare instances

  12. Gas leases • Land use regulations pertaining to exploratory drilling • regulations exist throughout the country but very little in NYS • Clermont,NY requires zoning permit from zoning enforcement officer for drilling activities in the floodplain

  13. Gas leases • Other examples of land use regulations pertaining to exploratory drilling • Napa,CA • requires temporary exploratory probe permit • similar to special use permit with site plan review • requires holes to be sealed within 365 days from commencement of operations • requires indemnity bond to insure site is returned to original state, to the extent possible • requires liability insurance • work must commence within 60 days of issuance of permit

  14. Gas leases • Other land use regulations pertaining to exploratory drilling • Garden City,KS • exploratory drilling prohibited within 25ft. of a building • prohibited within 25ft. Of a property line unless the adjoining property is also under a lease agreement • drilling locations and equipment shall be enclosed in temporary fencing of at least 4ft. in height

  15. Gas leases • Garden City,KS (continued) • gas wells and equipment require chain link fencing a minimum of 6ft. in height • drilling, completion, equipping, repairing, and maintenance of wells can only occur Monday through Friday between the hours of 8am and 5pm

  16. Exploratory drilling • Does not appear to require a building permit for exploratory drilling • appears that the Town can require site plan review

  17. Gas leases • References • “Mother Earth News” issue #85 • www.motherearthnews.com • Ohio Department of Natural Resources “Mineral Resource Management” • www.ohiodnr.com • Town of Clermont,NY zoning • www.nypf.org/clermont.htm

  18. Gas leases • References (continued) • Napa,CA zoning • www.co.napa.ca.us • Garden City,KS zoning • www.garden-city.org

  19. Gas leases • ???Questions???

More Related