MANCHIN WANTS TO SCRAP "SACRED" ROYALTY RIGHTS FOR WV HOLDERS

(08/18/2007)

HISTORY LESSON: "OPEN FOR BUSINESS" EQUALS GROSS POVERTY

By Bob Weaver

Gov. Joe Manchin is wanting to make sure West Virginia is "Open for Business."

Manchin is asking WV legislators during a special session to protect big natural gas and oil drillers from lawsuits like the $404 million suit in Roane County that favored state royalty holders.

The royalty holders claimed they were being ripped off by Chesapeake Energy and other producers.

Manchin's proposal would allow the big firms to charge for post-production costs of getting the natural gas to a pipeline and any preparatory items.

Holders groups have said the "giving away" of royalty gas and water rights held by state residents is the final surrender to the corporate extractors.

The corporations have been deducting post-production expenses from the "sacred" rights long-held by royalty holders in the Mountain State.

About ten thousand royalty owners in the class action suit will likely be up in arms, in addition to thousands more of WV royalty holders.

Roane Circuit Judge Tom Evans recently upheld the more than $404 million royalties verdict against the natural gas companies, including $270 million in punitive damages.

Attorneys for the holders said the verdict was not unreasonable, in view of customary settlements and the exorbitant amount of money involved with natural gas production.

Chesapeake Energy, NiSource and other gas-drilling businesses in the state said they would appeal to the state Supreme Court.

Chesapeake Energy, one of the nation's largest natural gas producers, threatened to leave the state if the courts upheld the verdict.

The corporation continued to acquire hundreds of leases and has since announced the construction of two multi-million dollar office complexes in Charleston and Jane Lew.

Manchin said "in this state's interest to promote a stable business environment and to ensure that changes in federal regulations and unsettled law do not impede development of the West Virginia oil and natural gas industry and do not lead to uncertainty and expensive litigation of existing business relationships ..."

It is unclear who will represent the state's royalty holders at the special legislative session, if anyone.

Corporations have targeted WV for having an unfavorable business climate.

But WV counties with billion-dollar natural resources that have been "open for business" during the past one hundred years are the nation's most poverty stricken.