PA Supreme Court Rules In Favor of Drillers

The Pennsylvania Supreme Court is siding with the natural gas industry in a case that landowners had hoped would help them cash in on the Marcellus Shale rush. The high court upheld a Susquehanna County Judge's ruling that validated the lease agreements that subtract the drilling costs from the calculating of the natural gas royalties for landowners. Several landowners sued contending that such leases are invalid because state law guarantees landowners a minimum one eighth royalty from the production of oil and gas on their property. Industry representatives said the suits were sour grapes because the landowners signed the leases before the rush began and the royalties jumped sharply.