Abandonment of Oil and Gas Interest

Throughout the history of West Virginia, oil and gas (and other minerals) were severed from the surface through reservations by the land owners who were selling their property. 

   As the new mineral owners would die or move on, the ownership of the minerals under these tracts would become fractured leaving certain family members who would take over and pay the taxes, sign leases and sometimes claim total ownership of the mineral interest. 

   Because the WV Code requires that all mineral owners sign oil and gas leases , our State Legislature enacted a law to claim the minerals as being abandoned through legal action brought by persons with interest or companies who may have the other portion of the minerals leased but who were unable to move forward with the drilling because all of the owners could not be found. 

   In the instance that a mineral owner was not found, the oil and gas company would go to court and have the unfound mineral owners declared as abandoned and the Judge would set up a Special Receiver to collect the rents and royalties for a period of seven years. If the mineral owner came forward and claimed ownership of the minerals, then the mineral owner kept the minerals and any money that had been received by the Special Receiver for that interest.  

   If the abandoned owner did not come forward in the seven years, the money held in escrow by the Special Receiver and the minerals are deeded to the current SURFACE OWNER. 

   During the last few Legislative Sessions, a push was made to approve giving the money that had accrued by the Special Receiver in the abandoned minerals owners name to the WV Department of Environmental Protection (DEP)  with the funds to be used to plug abandoned wells. 

   During the 2019 Legislative Session the pushed was stopped by many people writing letters and requesting the Legislatures’ to vote no and the new code did not pass. 

   During this past year’s Legislative Session, HB 4088 was passed unanimously, with  four members being absent. This new law gives the money held in the name of the abandoned owners to the WV DEP for the purpose of plugging old wells in the State.  

   In mid June, the Special Receivers in the State were asked by the WV DEP how much money was being held in the name of Abandoned Owners and reminded them the funds held on July 1st, 2020 are to be turned over to the WV DEP November 1st, 2020. 

   This paper, while writing up the list of Deeds and Leases, stumbled onto a Court Order and Special Commissioners Deed for one of these Abandonment Suites. 

   Yes, in the Order and Deed that was discovered, the surface owners of a 

a tract of land were handed a check of over $190,000  with the Court Costs being around $6000  and the mineral interest that had found to be abandoned was deeded back to this Surface Owner.  

    Through other research, it was found that currently, in Doddridge County alone, there is around a dozen abandonment suits pending with over a million of dollars being held by a Court Appointed Special Receiver for the abandoned mineral owners. 

    It is understood at this time that two other abandonment suites, have also matured and due to COVID restrictions are not completed and they will be dispersed to the surface owners as time allows. 

   So, what happens to the funds already collected for remainder of the aba donment suites?  Will there be anyone who will stand up and call this what it truly is, legal thievery?  The surface owners didn’t drill those wells and abandon them. 

   The DEP is the agency who has control of the wells before and after they are drilled, so why would the State penalize a Surface Owner by taking the funds collected and use that money to pay for something that the Surface Owner had no control over?  

   There are more questions than answers to this dilemma of what is perceived to be an “illegal taking” but, general consensus says that changing the law back to what it was is not the answer leaving the only other answer to be fighting this law in a Supreme Court action.  

   A statement was received from David Kelly, WV House, District 6, that said, “ HB-4088 passed the House February 13 unanimously with four people absent or not voting. Likewise it passed the Senate on March 5. The Governor signed it into to law on March 25 and it took effect this past June. 

   When a bill passes with this level of bipartisan support it is because no one was speaking against it. 

   Recently, I’ve had conversations with constituents from our area who  have informed me that they have great concerns about HB-4088. We were successful this past session in stopping some of the bills that would have a negative impact on our citizens. I work closely in Charleston with representatives from the Land Owners Association, Royalty Owens Association, and the Farm Bureau, as well as other organizations. When they have a concern about a particular piece of legislation they let us know. 

   Moving forward I’m asking the great people of  District 6 to let me know  if you have concerns about bills that are being introduced in the Legislature. Together, we can do more to make West Virginia and District 6 a better way to live, work, and raise a family.