H. B. 4286
(By Delegate Burdiss, Brown, Eldridge, Moore, Guthrie, Wells and
M., Poling)
[Introduced January 25, 2008; referred to the
Committee on Industry and Labor, Economic Development and Small
Business then Finance.]
A BILL to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new article, designated §22-5A-1, §22-5A-2,
§22-5A-3, §22-5A-4, §22-5A-5, §22-5A-6, §22-5A-7, §22-5A-8,
§22-5A-9, §22-5A-10 and §22-5A-11; to amend and reenact
§22-6-6, §22-6-9 of said code; to amend and reenact §22-7-3,
§22-7-5, §22-7-7 of said code; and to amend said code by
adding thereto a new section, designated §22-7-9, all relating
to rights, administration and enforcement of oil and gas
wells; surface owner bill of rights.
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new article, designated §22-5A-1, §22-5A-2,
§22-5A-3, §22-5A-4, §22-5A-5, §22-5A-6, §22-5A-7, §22-5A-8,
§22-5A-9, §22-5A-10 and §22-5A-11; that §22-6-6, §22-6-9, §22-7-3, §22-7-5 and §22-7-7 of said code be amended and reenacted; and that
said code be amended by adding thereto a new section, designated
§22-7-9, all to read as follows:
ARTICLE 5A. OIL AND GAS SURFACE OWNER'S BILL OF RIGHTS.
§22-5A-1. Findings and purpose.
(a) The Legislature finds that the owner of the surface of
property where an oil or gas lease operator intends to drill a well
in many cases does not own the minerals or any right to the royalty
or any other benefit from the drilling of the well on, or the
production of oil or gas from under, the surface owner's property.
(b) Under the common law, unless changed by the terms of a
severance deed or a lease, the operator only has the right to do
what is "fairly necessary" to produce the oil or gas but must give
"due regard" to the interest of the surface owner.
(c) State code only requires that the operators to give the
surface owner fifteen days' notice that the operator has applied to
the state for a permit to drill an oil or gas well on the surface
owner's land. And this notice already contains a well site
location and access road location that the operator has already
selected and surveyed to include in the operator's permit
application. The operator may come on to the land and even send
surveyors to mark well sites and road locations without notifying
or talking to the surface owner first.
(d) The surface owner has a right to comment on the permit application if he or she can get comments to the Office of Oil and
Gas of the Department of Environmental Protection within fifteen
days of filing the permit. However, the surface owner has no right
to a hearing on the surface owner's comments on the permit
application.
(e) The surface owner's comments on the operators drilling
permit application cannot cause the state to change the permit on
the grounds that the operator is doing more surface disturbance and
so on to the surface owner's land than is fairly necessary. The
state can only change the permit for the reasons set out in the
next subsection.
(f) The state can only change an operator's permit to drill an
oil or gas well based on the surface owner's comments if the
drilling activity proposed in the permit would cause erosion or
sedimentation, if the down hole casing and tubing program would
endanger water sources, if the drilling would be a safety hazard,
if the drilling would damage public lands, or if the state has
issued an actual "violation" for improper activity relating to
other wells.
(g) As a result, many operators take advantage of this
surprise, plus the operator's advantages of more knowledge and
years of experience compared to the surface owner who has never
seen a well drilled before, plus the operator's vast advantages of
resources and lawyers compared to a citizen landowner - as a result of these advantages, many operators fail to give due regard to any
preferences of the surface owners and they do more than is fairly
necessary to the surface owner and his or her land.
(h) Although one statute provides that many surface owners are
entitled to compensation for the use of their surface land, under
that statute the surface owners are not entitled to their land's
full market value or to the diminution in the value of lands
adjacent to the well site, access road and pipeline caused by the
well work, even though the surface owners are the ones who will
continue to pay taxes on the disturbed land.
(i) Although the gas will be produced from under the surface
owners, and although the gas will be produced out of a well placed
on their land and piped to market across their land, surface owners
have no right to connect to the well or gathering pipelines for
their domestic use of the gas - at any price.
(j) The Legislature therefore exercises its police and other
powers to regulate the exercise of the parties' common law rights
by the enactment of this article.
§22-5A-2. Definitions.
For the purposes of this article the words or terms used in
this article, and any variation of those words or terms required by
the context, have the meanings ascribed to them in article six of
this chapter unless a different meaning clearly appears from the
context.
§22-5A-3. Notices.
The notices to the surface owner required by this article
shall be given to the same persons or entities and in the same
manner as set out for notice to surface owners of the drilling
permit as provided in article six, section nine-a of this chapter.
§22-5A-4. Notice of initial entry upon surface lands.
(a) At least fourteen days before entering upon the surface
land for inspection, measurements, surveying or other evaluation of
proposed access routes and sites for either new well work or roads
or other well work requiring disturbance of the surface that has
not been disturbed before by the operator, an operator shall
provide notice of the fact that the operator is entering the
surface land and of the general purposes for such entry. The
fourteen days begins to run from the surface owner's actual receipt
of the notice.
(b) The notice shall include:
(1) The name, a physical address, a land line telephone number
if one exists, and if in use, cell phone, e-mail or other
electronic contact information of the operator, of any contractor
for the operator, and the actual person or persons who may come
onto the land and their supervisor;
(2) The anticipated, approximate dates and times of entry on
to the surface land;
(3) A copy of the West Virginia Oil and Gas Production Compensation Act;
(4) A copy of the soil erosion and sediment control manual of
the Office of Oil and Gas of the State of West Virginia; and
(5) An offer to meet with the surface owner either on the land
or, at the option of the surface owner, at another mutually agreed
location. The offer to meet shall be to meet prior to or at the
time of this first entry and in addition prior to the next required
notice.
(c) At the meeting the operator shall point out and explain
his or her preference for locations of well sites, shall consider
the surface owner's suggestions for alternate locations, and if the
surface owners suggestion be used, shall state the reasons it
cannot be used. The surface owner shall state his or her
preference for access roads to the proposed sites and consider the
operator's suggestions for alternative road locations, and if the
surface owners suggestion cannot be used, the operator shall state
the reasons it cannot be used.
§22-5A-5. Notice of planned surface use.
(a) Before first entering upon the land of the surface owner
to disturb the surface to conduct new well work or to disturb the
surface using motorized equipment, the operator shall give the
surface owner notice of the planned well work or other surface
disturbance. The operator may not enter onto the land until sixty
days after the notice has been given unless, prior to giving the notice required by this section the operator has met with the
surface owner and negotiated a proposed surface use and
compensation agreement, or unless after giving the notice the
operator has met with the surface owner and negotiated a proposed
surface use and compensation agreement that includes a waiver as
allowed by this section. If the operator has negotiated a proposed
surface use and compensation agreement, the operator may not enter
onto the land until ten days after the surface owner receives a
signed copy or duplicate original of the surface use and
compensation agreement, or ten days after the application for the
well work permit is filed by the operator pursuant to article six,
section six of this chapter, whichever is earlier.
(b) The notice of the planned well work shall include:
(1) The name, a physical address, land line telephone number,
and if in use, cell phone, e-mail or other electronic contact
information of the operator and of any contractor or other agent
acting on behalf of the operator; and
(2) A proposed surface use and compensation agreement as set
out in next section.
(c) The notice of planned well work shall include a copy of
the West Virginia Oil and Gas Production Compensation Act and the
soil erosion and sediment control manual of the West Virginia
Office of Oil and Gas unless the surface owner has already received
them.
(d) A statement that if the parties cannot agree, then they
may contact a trained mediator to try to resolve their differences.
(e) The proposed surface use and compensation agreement may be
one that has already been negotiated after giving the notice.
However, any proposed agreement is not final until ten days after
receipt of a signed copy or duplicate original.
§22-5A-6. Surface use and compensation agreement.
(a) A surface use agreement must be in writing or, if the
surface owner agrees and has the ability to use it, in the form of
an authenticated electronic record.
(b) A surface use agreement shall include:
(1) The name, physical address, telephone number of the
operator, the surface owner(s) and the mineral owner(s);
(2) Locations and dimensions of well sites, access roads,
pipeline rights-of-way and other uses given in sufficient detail
and in a format for the surface owner to be able to locate them on
his or her property, and determine what soil and timber or other
vegetation will be disturbed;
(3) Specifications for construction of the well site, pits,
disposal areas, access roads, pipelines, and other facilities or
uses associated with the well work, including without limitation
temporary soil erosion and sediment control, top soil banking and
road steepness, side slope, and drainage structures and their
frequency;
(4) Specifications for the life of the well reclamation of the
well site, pits, disposal areas, access roads, pipelines, and
other facilities or uses associated with the well work including
without limitation erosion and sediment control for the life of the
well;
(5) Specifications for the revegetation of the well site,
pits, disposal areas, access roads, pipelines, and other
facilities or uses associated with the well work, road surfaces,
soil preparation, temporary seed species, and permanent seed
species;
(6) Specifications for maintenance of well sites, pipelines
and access roads, including frequency;
(7) Particular specifications for maintenance at all times of
existing roads used by the surface owner that will also be utilized
by the operator, including, without limitation, gating appliance
specifications and gating practices; and
(8) Compensation to the surface owner pursuant to article
seven of this chapter or the common law including without
limitation compensation for occupation of the land disturbed and
used by the well site, access road and pipeline, diminution in
value of adjacent land, and lost timber and other crops and
vegetation.
(c) A surface use and compensation agreement may also waive
the surface owner's right to comment on the permit application pursuant to article six of this chapter if the surface owner is
given a copy of the permit application ten days before the waiver.
(d) A surface use and compensation agreement may not waive
damages for breach of the agreement, for pollution of water sources
or supplies not identified in the agreement, for negligence or
failure to perform tasks in a workmanlike manner, or for unforeseen
damages.
§22-5A-7. Effect of surface use and compensation agreement on
bond.
If an agreed upon surface use and compensation agreement is
not submitted with the permit application, the operator may not
place the well under his or her blanket bond. Instead the operator
shall furnish an individual well bond, and the bond shall also be
conditioned upon payment of any damages or compensation to which a
surface owner may become entitled; provided that the amount of such
bond, notwithstanding the provision of other law, shall be ten
thousand dollars.
§22-5A-8. Well head or gathering gas service access line.
(a) Where the owner of the surface that is disturbed for well
work or a pipeline is not entitled to or is not given free gas and
does not have access to gas from a regulated utility, the surface
owner shall have the option of connecting to the well or to any
gathering line to the well to obtain gas service for one residence
or farm, or residence and associated farm, for every disturbed surface tract that is separately owned at the time of the initial
disturbance on that surface tract.
(b) The surface owner is responsible for all of the reasonable
actual costs of making the connection.
(c) The operator may set reasonable conditions to assure the
safety and integrity of its system in the surface use and
compensation agreement.
(d) The operator may require the surface owner to pay for the
gas at a price no greater than that used to determine the royalty
owner's payment.
(e) The operator has the duty to warn of known dangers
relating to the surface owner's use of the gas, but is otherwise
not liable for ordinary negligence.
(f) The Public Service Commission shall make information
available to the public at cost on the limitations and risks of
well head and gathering line gas. A copy of the information shall
be provided to the surface owner by the operator before signing the
surface use agreement.
(g) The commission shall propose a legislative rule setting
out the subjects regarding gas service from a well head or
gathering line which must be addressed in a surface use and
compensation agreement which authorizes use of well head or
gathering line gas.
(h) A person who receives well head or gathering line gas pursuant to this section is not a "residential customer" for the
purpose of determining whether a natural gas producer is a public
utility.
§22-5A-9. Right to hearing and appeal.
If a surface owner files comments pursuant to article six,
section ten of this chapter, and if the Chief of the Office of Oil
and Gas is not able to mediate an agreement between the surface
owner and the operator compliant with the laws and regulations and
permits of the state on the issues raised in the comments, then the
chief shall hold a hearing as a contested case pursuant to chapter
twenty-nine-a, article five of this code before completing his or
her review or issuing a permit pursuant to article six, section
eleven of this chapter.
§22-5A-10. Options for surface use and revegetation.
(a) The office of oil and gas shall include in its soil
erosion and sediment control manual alternatives for road
construction, that include the interests of the surface owner for
a permanent road intended for regular travel through his or her
property or a road that has minimal impacts upon the property, and
alternatives for revegetation with fast growing, wildlife, or
native seed species or other individually negotiated seed species
subject to approval by the chief.
(b) Any requirement of the soil erosion and sediment control
manual that can be waived by the inspector of the office of oil and gas can only be waived if the surface owner also agrees in writing.
If the surface owner is a natural person or persons, the waiver
must be in writing and separately signed from other waivers.
(c) Day lighting, the practice of clearing woody material back
from the roadway in an attempt to accelerate drying of the road
surface may only be used with the written consent of the surface
owners.
§22-5A-11. Effective dates.
Sections one, two, three, four, five, six, seven and nine
shall apply to all permits issued more than ninety days from
passage. Section eight shall take effect ninety days from passage.
Subsections (b) and (c) of section ten take effect from passage.
Subsection (a) of section ten takes effect the first day of
September, two thousand eight.
ARTICLE 6. OFFICE OF OIL AND GAS; OIL AND GAS WELLS;
ADMINISTRATION; ENFORCEMENT.
§22-6-6. Permit required for well work; permit fee; application;
soil erosion control plan.
(a) It is unlawful for any person to commence any well work,
including site preparation work which involves any disturbance of
land, without first securing from the director a well work permit.
An application may propose and a permit may approve two or more
activities defined as well work.
(b) The application for a well work permit shall be accompanied by applicable bond as prescribed by section twelve,
fourteen or twenty-three of this article, and the applicable plat
required by section twelve or fourteen of this article.
(c) Every permit application filed under this section shall be
verified and shall contain the following:
(1) The names and addresses of: (i) The well operator; (ii)
the agent required to be designated under subsection (e) of this
section; and (iii) every person whom the applicant must notify
under any section of this article together with a certification and
evidence that a copy of the application and all other required
documentation has been delivered to all such persons;
(2) The name and address of every coal operator operating coal
seams under the tract of land on which the well is or may be
located, and the coal seam owner of record and lessee of record
required to be given notice by section twelve, if any, if said
owner or lessee is not yet operating said coal seams;
(3) The number of the well or such other identification as the
director may require;
(4) The type of well;
(5) The well work for which a permit is requested;
(6) The approximate depth to which the well is to be drilled
or deepened, or the actual depth if the well has been drilled;
(7) Any permit application fee required by law;
(8) If the proposed well work will require casing or tubing to be set, the entire casing program for the well, including the size
of each string of pipe, the starting point and depth to which each
string is to be set, and the extent to which each such string is to
be cemented;
(9) If the proposed well work is to convert an oil well or a
combination well or to drill a new well for the purpose of
introducing pressure for the recovery of oil as provided in section
twenty-five of this article, specifications in accordance with the
data requirements of section fourteen of this article;
(10) If the proposed well work is to plug or replug the well:
(i) Specifications in accordance with the data requirements of
section twenty-three of this article; (ii) a copy of all logs in
the operator's possession as the director may require; and (iii) a
work order showing in detail the proposed manner of plugging or
unplugging the well, in order that a representative of the director
and any interested persons may be present when the work is done.
In the event of an application to drill, redrill or deepen a well,
if the well work is unsuccessful so that the well must be plugged
and abandoned, and if the well is one on which the well work has
been continuously progressing pursuant to a permit, the operator
may proceed to plug the well as soon as the operator has obtained
the verbal permission of the director or the director's designated
representative to plug and abandon the well, except that the
operator shall make reasonable effort to notify as soon as practicable the surface owner and the coal owner, if any, of the
land at the well location, and shall also timely file the plugging
affidavit required by section twenty-three of this article;
(11) If the proposed well work is to stimulate an oil or gas
well, specifications in accordance with the data requirements of
section thirteen of this article;
(12) The erosion and sediment control plan required under
subsection (d) of this section for applications for permits to
drill; and
(13) Any other relevant information which the director may
require by rule.
(d) An erosion and sediment control plan shall accompany each
application for a well work permit.
except for a well work permit
to plug or replug any well Such plan shall contain methods of
stabilization and drainage, including a map of the project area
indicating the amount of acreage disturbed,
including without
limitation acreage disturbed for pipelines and the type and spacing
of access road drainage structures. The erosion and sediment
control plan shall meet the minimum requirements of the West
Virginia erosion and sediment control manual as adopted and from
time to time amended by the division, in consultation with the
several soil conservation districts pursuant to the control program
established in this state through section 208 of the federal Water
Pollution Control Act Amendments of 1972 (33 U.S.C. §1288). The erosion and sediment control plan shall become part of the terms
and conditions of a well work permit,
except for a well work permit
to plug or replug any well, which is issued and the provisions of
the plan shall be carried out where applicable in the operation.
The erosion and sediment control plan shall set out the proposed
method of reclamation which shall comply with the requirements of
section thirty of this article.
(e) The well operator named in such application shall
designate the name and address of an agent for such operator who
shall be the attorney-in-fact for the operator and who shall be a
resident of the State of West Virginia upon whom notices, orders or
other communications issued pursuant to this article or article
eleven, chapter twenty-two, may be served, and upon whom process
may be served. Every well operator required to designate an agent
under this section shall within five days after the termination of
such designation notify the director of such termination and
designate a new agent.
(f) The well owner or operator shall install the permit number
as issued by the director in a legible and permanent manner to the
well upon completion of any permitted work. The dimensions,
specifications and manner of installation shall be in accordance
with the rules of the director.
(g) The director may waive the requirements of this section
and sections nine, ten and eleven of this article in any emergency situation, if the director deems such action necessary. In such
case the director may issue an emergency permit which would be
effective for not more than thirty days, but which would be subject
to reinsurance by the director.
(h) The director shall deny the issuance of a permit if the
director determines that the applicant has committed a substantial
violation of a previously issued permit, including the erosion and
sediment control plan, or a substantial violation of one or more of
the rules promulgated hereunder,
and
(i) Any person who violates any provision of this section
shall be guilty of a misdemeanor and, upon conviction thereof,
shall be fined not more than five thousand dollars, or be
imprisoned in the county jail not more than twelve months, or both
fined and imprisoned.
§22-6-9. Notice to property owners.
(a) No later than the filing date of the application, the
applicant for a permit for any well work shall deliver by personal
service or by certified mail, return receipt requested, copies of
the application, well plat and erosion and sediment control plan
required by section six of this article to each of the following
persons:
(1) The owners of record of the surface of the tract on which
the well is, or is to be located; and
(2) The owners of record of the surface tract or tracts
overlying the oil and gas leasehold being developed by the proposed
well work, if such surface tract is to be utilized for roads,
pipelines or other land disturbance as described in the erosion and
sediment control plan submitted pursuant to section six of this
article.
(b) If more than three tenants in common or other coowners of
interests described in subsection (a) of this section hold
interests in such lands, the applicant may serve the documents
required upon the person described in the records of the sheriff
required to be maintained pursuant to section eight, article one,
chapter eleven-a of this code or plus any other owner who has
requested a copy in a record and any owner occupying the land:
Provided, That the operator must check the grantor records of deeds
from the date from which the sheriff's records were taken to the
present, and if there is a new owner or owners, then service must
be made on those new owners. If there is no owner occupying the
surface and neither a current location for personal service nor a
mailing address for registered or certified mail notice of the
person described in the tax records can be obtained after
reasonable diligence and, no other owner has requested a copy, the
applicant may instead publish in the county in which the well is
located or to be located a Class II legal advertisement as
described in section two, article three, chapter fifty-nine of this
code, containing such notice and information as the director shall
prescribe by rule, with the first publication date being at least
ten days prior to the filing of the permit application: Provided,
That all owners occupying the tracts where the well work is, or is
proposed to be located at the filing date of the permit application
shall receive actual service of the documents required by subsection (a) of this section.
(c) Materials served upon persons described in subsections (a)
and (b) of this section shall contain a statement of the methods
and time limits for filing comments, who may file comments and the
name and address of the director for the purpose of filing comments
and obtaining additional information and a statement that such
persons may request, at the time of submitting comments, notice of
the permit decision and materials served shall also include a list
of persons qualified to test water as provided in this section.
Materials served shall also include a notice that the surface owner
may be entitled to compensation pursuant to the West Virginia Oil
and Gas Production Compensation Act.
(d) Any person entitled to submit comments shall also be
entitled to receive a copy of the permit as issued or a copy of the
order denying the permit if such person requests the receipt
thereof as a part of the comments concerning said permit
application.
(e) Persons entitled to notice may contact the district office
of the division to ascertain the names and location of water
testing laboratories in the area capable and qualified to test
water supplies in accordance with standard accepted methods. In
compiling such list of names the division shall consult with the
state bureau of public health and local health departments.
ARTICLE 7. OIL AND GAS PRODUCTION DAMAGE COMPENSATION.
§22-7-3. Compensation of surface owners for drilling operations.
(a) The oil and gas developer shall be obligated to pay the
surface owner compensation for:
(1) Lost income or expenses incurred as a result of being
unable to dedicate land actually occupied by the driller's
operation or to which access is prevented by such drilling
operation to the uses to which it was dedicated prior to
commencement of the activity for which a permit was obtained
measured from the date the operator enters upon the land until the
date reclamation is completed;
(2) The market value of crops destroyed, damaged or prevented
from reaching market;
(3) Any damage to a water supply in use prior to the
commencement of the permitted activity;
(4) The cost of repair of personal property up to the value of
replacement by personal property of like age, wear and quality; and
(5) The diminution in value, if any, of the surface lands and
other property after completion of the surface disturbance done
pursuant to the activity for which the permit was issued determined
according to the actual use made market value thereof by the
surface owner immediately prior to the commencement of the
permitted activity, including the surface lands actually disturbed,
and any adjacent surface lands the market value of which is
diminished by the presence of the well and the surface disturbance and other appurtenances.
The amount of damages may be determined by any formula
mutually agreeable between the surface owner and the oil and gas
developer.
(b) Any reservation or assignment of the compensation provided
in this section apart from the surface estate except to a tenant of
the surface estate is prohibited.
(c) In the case of surface lands owned by more than one person
as tenants in common, joint tenants or other coownership, any claim
for compensation under this article shall be for the benefit of all
such coowners. The resolution of a claim for compensation provided
in this article shall operate as a bar to the assertion of
additional claims under this section arising out of the same
drilling operations.
§22-7-5. Notification of claim.
Any surface owner, to receive compensation under section three
of this article, shall notify the oil and gas developer of the
damages sustained by the person
within at any time after ninety
days after the drilling rig is removed from the site, but no later
than two years after the date that the oil and gas developer files
notice that reclamation is commencing under section thirty, article
six of this chapter. Such notice shall be given to surface owners,
by delivering it in person, by registered or certified mail, return
receipt requested, and shall be complete upon mailing. If more than three tenants in common or other coowners hold interests in
such lands, the developer may give such notice to the person
described in the records of the sheriff required to be maintained
pursuant to section eight, article one, chapter eleven-a of this
code,
or and to any other owner requesting a copy or if neither a
current location for personal service nor a mailing address for
registered or certified mail notice can be obtained after
reasonable diligence, and no other owner has requested a copy
publish in the county in which the well is located or to be located
a Class II legal advertisement as described in section two, article
three, chapter fifty-nine of this code, containing such notice and
information as the director shall prescribe by rule.
§22-7-7. Rejection; legal action; arbitration; fees and costs.
(a) Unless the oil and gas developer has paid the surface
owner a negotiated settlement of compensation within sixty days
after the date the notification of claim was mailed under section
five of this article, the surface owner may within eighty days
after the notification mail date, either: (i) Bring an action for
compensation pursuant to this article in the circuit court of the
county in which the well is located within the statute of
limitations for a common law damages action; or (ii) within one
hundred twenty days after the notification mail date, elect
instead, by written notice delivered by personal service or by
certified mail, return receipt requested, to the designated agent named by the oil and gas developer under the provisions of section
six, article six of this chapter, to have his or her compensation
finally determined by binding arbitration pursuant to article ten,
chapter fifty-five of this code. A surface owner may not proceed
in circuit court after receiving an arbitration award pursuant to
this article.
Settlement negotiations, offers and counter-offers between the
surface owner and the oil and gas developer shall not be admissible
as evidence in any arbitration or judicial proceeding authorized
under this article, or in any proceeding resulting from the
assertion of common law remedies.
(b) The compensation to be awarded to the surface owner shall
be determined by a panel of three disinterested arbitrators. The
first arbitrator shall be chosen by the surface owner in such
party's notice of election under this section to the oil and gas
developer; the second arbitrator shall be chosen by the oil and
gas developer within ten days after receipt of the notice of
election; and the third arbitrator shall be chosen jointly by the
first two arbitrators within twenty days thereafter. If they are
unable to agree upon the third arbitrator within twenty days, then
the two arbitrators are hereby empowered to and shall forthwith
submit the matter to the court under the provisions of section one,
article ten, chapter fifty-five of this code, so that, among other
things, the third arbitrator can be chosen by the judge of the circuit court of the county wherein the surface estate lies.
(c) The following persons shall be deemed interested and not
be appointed as arbitrators: Any person who is personally
interested in the land on which rotary drilling is being performed
or has been performed, or in any interest or right therein, or in
the compensation and any damages to be awarded therefor, or who is
related by blood or marriage to any person having such personal
interest, or who stands in the relation of guardian and ward,
master and servant, principal and agent, or partner, real estate
broker, or surety to any person having such personal interest, or
who has enmity against or bias in favor of any person who has such
personal interest or who is the owner of, or interested in, such
land or the oil and gas development thereof. No person shall be
deemed interested or incompetent to act as arbitrator by reason of
being an inhabitant of the county, district or municipal
corporation wherein the land is located, or holding an interest in
any other land therein.
(d) The panel of arbitrators shall hold hearings and take such
testimony and receive such exhibits as shall be necessary to
determine the amount of compensation to be paid to the surface
owner. However, no award of compensation shall be made to the
surface owner unless the panel of arbitrators has first viewed the
surface estate in question. A transcript of the evidence may be
made but shall not be required.
(e) Each party shall pay the compensation of such party's
arbitrator and one half of the compensation of the third
arbitrator, or such party's own court costs as the case may be.
§22-7-9. Effective date of amendments.
The amendments to this article made by the regular session of
the 2008 Legislature take effect for all well work for which a
notice that the operator is commencing reclamation pursuant to
section five of this article.
NOTE: The purpose of this bill is to expand rights for owners
of the surface property where oil and gas wells are drilled.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
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