Shale drilling lease extensions result in court cases
Tuesday, March 24, 2015
Whether a lessor knows it or not, the primary term of a shale oil and gas lease can be extended by the lessee, according to The Legal Intelligencer. This is possible due to an express extension provision in the lease.
The extension of the primary term is for the lessee to further develop the oil and gas on the property. Lessors have filed lawsuits in response to lease extensions for grounds such as the extension language and the timing of the extension.
In Pennsylvania, as well as in Ohio and West Virginia, courts have decided on cases involving lease extension provision interpretation.
Via: The Legal Intelligencer > An Update on Oil and Gas Lease Extension Litigation
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Shale FAQ
What is fracking?
Fracking is a slang term for hydraulic fracturing. Fracturing is a process by which highly pressurized fluid is pumped thousands of feet into the ground to fracture rock formations. The goal is to release the natural gas that’s locked inside the rock.
Is it safe?
What most concerns people about fracturing is ground water contamination. The worry is that fractures underground, caused by the process, will extending upwards and into aquifers, releasing gas and chemicals into the ground water supply. There’s been no confirmed reports of such a thing happening. Though surface spills and drill site blowouts can lead to localized environmental concerns.
Will my water catch on fire?
Flammable water is caused by the release of methane gas into a drinking water supply. Methane gas occurs naturally and can be released by any kind of drilling, including water wells. In Pennsylvania officials fined Chesapeake Energy $1 million for contaminating ground water with methane. It was determined that the company had not properly cemented it’s boreholes and gas migrated up the well, between rock and into aquifers.