Bacon's Rebellion

Democracy Thrives in Sunlight

Give Me My Gas!

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by

James A. Bacon
in


A

s Chamber of Commerce events go, the energy conference held in Richmond by the Virginia group on Dec. 10 seems typical enough. A slew of energy company executive boosted their endeavors and their products, noting that the state will need coal, nuclear, wind, and natural gas.

For the coal officials, there was no mention of mountain top removal which lops off entire mountaintops like a bottle cap forever changing the watershed and aesthetics of coal country. There was the usual griping about possible cap and trade legislation and regulations and regulators in general.
Which is a curious point when one reads the Bristol Herald Courier in a Virginia city so far west it is half in Tennessee. The newspaper ran an eight-day series raising questions about how royalties from natural gas deposits are collected and distributed.
Some time ago, the General Assembly enacted laws that required “forced pooling” which means that others can tap the gas deposits underneath your property. You can’t give your consent — it’s not your call. But, you are supposed to get funds from an escrow fund into which the gas tappers are supposed to put a certain amount of money to pay you back. That way, you see, it’s not outright theft.
The newspaper found that some natural gas companies such as EQT and CNX Gas, a unit of coal giant Consol Energy, don’t always make such payments. The issue gets more complex because some property owners have deeded over rights to coal, but not the methane that is typically found underground nearby the coal. What’s more, many of the land owners are merely individuals who may not even live in the gas producing areas of Virginia.
They may not know what’s going on and the state’s Gas and Oil Board and the Department of Mines, Minerals and Energy are supposed to tell them. That’s a tough pull since the state has all of TWO (count ’em) regulators overseeing something like 1,000 production wellheads.
So much for the whining about over regulation.
It’s really too bad since natural gas is coming into its own. There’s a flurry of mergers such as ExxonMobil’s acquisition of XTO Energy. Big new reserves have been found in the U.S. and Canada.
Sounds great. But who will have the advantage? Big companies such as those at the Virginia Chamber’s one-sided energy conference. Small property owners don’t have a place at the table.
Peter Galuszka

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6 responses to “Give Me My Gas!”

  1. Groveton Avatar
    Groveton

    Interesting post. Once again, the part time politicians in the General Assembly are asleep at the switch. First, they dream up some poaching scheme whereby you can tap natural gas from under a person's property without telling them. Then, they don't enforce the payments into the fund that was part of the Rube Goldberg scheme from the start.

    So, let's see …. the GA has failed to make dent in the transportation problems in NoVa, they allow corporations to steal from people in coal country, the mountaintop removal continues, they pass abusive driver fees which then have to be immediately repealed, they can't manage an IT outsourcing contract, the budget is a train wreak and they legislated the storage of private prescription information only to lose that information to a hacker.

    And that's just what I recall off the top of my head.

    This governance approach isn't working.

  2. Anonymous Avatar
    Anonymous

    Once again we see that property is a bundle of sticks. If you take one of my sticks you have taken my property and you need to pay for it.

    But what the law says is that you have not taken my property unless you have taken substantially all of my sticks.

    Little guys get the short end of even that stick.

    RH

  3. Groveton Avatar
    Groveton

    "Little guys get the short end of even that stick.".

    Agreed.

    But I thought we had part time legislators because they would remain citizen-politicians and would not fall under the spell of corporate special interests.

    That's not what happens. Rather, the part time politicians are overwhelmed with the business of running a gigantic enterprise called the Commonwealth of Virginia. They are not only part time politicians but they have very limited funding to hire staff. Meanwhile, the big corporations have plenty of highly paid, full time analysts and lobbyists. So, they lobby the part time legislators with their self-serving agenda and the part time politicos do their best but ultimately lose the battle.

    When it comes to protecting the little guy our General Assembly is bringing a knife to a gun fight.

  4. Anonymous Avatar
    Anonymous

    If we had a requirement that legislation show a net public benefit with cmpensation to the losers, this problem would go away.

    We would havea lot less legislation and a lot more accountants.

    RH

  5. Larry G Avatar
    Larry G

    " When it comes to protecting the little guy our General Assembly is bringing a knife to a gun fight."

    Okay.. so Virginia and it's General Assembly with part-time legislators is not the most perfect possible and yes.. we can find plenty to point to that could have been done better…

    but then what does this mean (one of several with the same results by the way) ?

    http://www.pewcenteronthestates.org/uploadedFiles/Overall%20Performance.pdf

    " The results reported in Grading the States 2008 reflect the performance of each state as a whole—including the intersection between the executive and legislative branches—not any individual or specific department. The cumulative assessments reflect the leadership and program implementation skills of elected and appointed officials as well as career civil servants and the not-for-profit and private sector providers who partner with states in the execution of policy and programs."

    The report examines amd measures four key areas- money, people, infrastructure and information.

    Money
    How states manage fiscal resources, including budgeting, forecasting, accounting and financial reporting, procurement, contracting, investments, and debt.

    People
    What states are doing to recruit and retain strong professionals and offering development and recognition for top-level service.

    Infrastructure
    How states maintain, improve and plan for future physical infrastructure needs, including roads, bridges and buildings.

    Information
    How effectively states apply data and technology to measure the effectiveness of services, make decisions and communicate with the public.

    So… Mr. Grovton – how about regaling us with your views of what State(s) Virginia should strive to emulate?

    Bonus Task: show us the BEST State with a FULL TIME legislature.

  6. Larry G Avatar
    Larry G

    Here's a little more info:

    States Rate A- (top 3 states):

    Utah
    Virginia
    Washington

    here is their legislator flavors:

    Utah – " on average lawmakers spend the equivalent of half of a full-time job doing legislative work. The compensation they receive for this work is quite low and requires them to have other sources of income in order to make a living. The blue states have relatively small staffs"

    Virgina, Washington:

    " Legislatures in the White category are hybrids. Legislatures in these states typically say that they spend more than two-thirds of a full time job being legislators. Although their income from legislative work is greater than that in the Blue states, it's usually not enough to allow them to make a living without having other sources of income. Legislatures in the White category have intermediate sized staff. States in the middle of the population range tend to have White legislatures."

    http://www.ncsl.org/?tabid=16701

    Now that we've completely blown your hot-air rhetoric to smithereens… you can move on to your next false premise….

    😉

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