Earlier this year, researchers from West Virginia University surveyed West Virginia land owners with shale wells on their property. They surveyed a sample of 481 landowners with a total of 680 wells on their properties (some had more than one). The survey asked about the use of the land prior to drilling, type of drilling, type of agreement, overall satisfaction with outcome, problems encountered, and other factors. The survey response rate was 43%. Of those who responsed, 61.5% were split estate landowners and 38.5% owned some or all of the minerals beneath their land.
This is an extremely important report. It is a technical survey with logistic regression models and other statistical analysis. Here are the basic findings I found most noteworthy:
- More than half of the respondents--57.4%--reported problems.
- 73% of respondents with horizontal wells reported problems compared to 46.5% of respondents with only conventional or vertically fractured wells.
- The biggest overall complaint was damage to the land.
- The average number of problems reported by respondents reporting at least one problem was 6!
- Common problems reported were declines in property values, truck traffic, lack of cooperation by the oil and gas company, inadequate compensation, and road damages.
- 60% of split estate surface owners are dissatisfied.
- 28% of surface/mineral owners are dissatisfied.
The authors say this comment was typical of others they received: "We were not consulted about location of pad or road, surveyed well site without notice, unsafe work site during drilling, poor topsoil preservation, pollution to streams, excessive acreage damaged, poor reclamation (slope spillage), ridiculously low offer of damage compensation. ($1500 for 8 acres of destruction)"
This study has statistically documented what we've been hearing for years.
In what other industry would companies be allowed to remain in business when they caused serious problems, including destruction of private property, for more than half the people with whom they came into contact? The archaic regulatory structure for the oil and gas industry in America is not appropriate for today's industry. Stronger rules, better enforcement, and meaningful penalties are all long overdue.