Forced pooling group to meet in Pittsboro Friday

Feb. 06, 2013 @ 08:04 PM

A state law is already in place that allows for compulsory “pooling,” a practice by which landowners are forced to join others in opening up their land for gas or oil exploration.

But the existing law dates to 1945, and was written long before shale gas or shale oil exploration was a technological possibility here, said Ted Feitshans, an associate professor at N.C. State University in the agricultural and resource economics department.

““There’s quite a bit that has to be fleshed out before this could be implemented, if a decision is made to implement it,” said Feitshans, who said he’s a member of a study group that’s in the early stages of studying forced pooling. The group, a study group of the N.C. Mining and Energy Commission, will meet Friday in Pittsboro.

The group has an Oct. 1 deadline to report its findings to the commission, which was set up last summer to develop rules regulating oil and gas management, including the practice of horizontal drilling and hydraulic fracturing, or “fracking,” a natural gas extraction technique.

A state law passed in the summer authorizes fracking in the state, but it prohibited state agencies from issuing permits until the legislature takes action again to allow them to be issued.

There is an Oct. 1, 2014, deadline for when oil and gas regulatory rules must be adopted by the commission, the Environmental Management Commission and the Commission for Public Health.

According to a N.C. Department of Environment and Natural Resources report, North Carolina’s Oil and Gas Conservation Act allows for both voluntary and compulsory pooling, which is the “grouping together of tracts of interests to form a drilling or production unit.”

Ray Covington, a member of the mining and energy commission and the chair of the compulsory study group, said the law does not give any real pooling guidelines.

Covington also said that since there is already a law on the books that allows for compulsory pooling, the study group’s task is to recommend best practices.

 “(We’ve been) asked to come back with recommendations of best practices of compulsory pooling law for North Carolina,” Covington said. “Our task is to look at all of the laws of all the states in the nation, and to see who’s done it right, and (which ones have done) it wrong, and learn from the lessons of both.”

Feitshans said issues need to be resolved such as what percentage of acreage in a production unit is required in order to force dissenting owners in the area into a pool.

He also said they would need to settle issues such as whether somebody forced into a pool can be completed to use of the surface of their land.

“Also – you need to look at questions such as liability. Does anyone forced into the pool have any liability for accidents…?” he said.

Dustin Chicurel-Bayard, communications director for the North Carolina chapter of the Sierra Club, said forced pooling is “essentially eminent domain for gas drillers.”

“It allows companies to drill on private property, or under private property, without the owner’s consent,” he said. “That’s very worrisome and concerning.”

Chicurel-Bayard also voiced environmental concerns associated with fracking.

“We think families who don’t want their private property drilled, and their drinking water contaminated…they should have the right to say no to that,” he said.

Therese Vick, a community organizer for the Blue Ridge Environmental Defense League who said she also works with citizen groups in Lee County, also voiced concerns.

“Compulsory pooling is taking of private property, in my opinion, for corporate use, and it deprives people of their civil liberties,” she said.

Covington said environmental issues are being discussed by the commission’s Environmental Standards Committee. He also said that even now, there’s “no way” anyone would be forced into a pool without properdue diligence.

“There’s no way anyone would be forced into a pool without due diligence, even at this point in time,” he said. “And whatever the recommendations we make to the Mining & Energy Commission, are only going to improve that on behalf of the property owners.”

The agenda for Friday’s meeting includes presentations on the ownership of oil and gas rights, effects of natural gas drilling and an overview of compulsory pooling in five oil and gas producing states, according to a news release.

The study group also plans to discuss policies related to compulsory pooling. The public may submit questions in writing to staff. According to the release, the questions will be addressed by the study group at the end of the meeting.

The meeting will be at 9 a.m. at the multi-purpose room at Central Carolina Community College in Pittsboro.