I am thinking about buying land in PA that could be drilled on for natural gas. I like the idea of the royalties, but I am also concerned about the environment. I need to know how long the contracts are for and what is involved? How is the environment affected over a long period? Any information would be helpful since I know nothing about what is involved. Thanks.
Yvette;
The natural gas play in PA is known as the Marcellus Shale. This has been and continues to a very active area in regards to drilling. First, if you are thinking about purchasing land in PA, make sure that the mineral rights are included and not just the surface. It is hard to purchase the mineral rights in most cases as the owner will normally sell just the surface rights and keep the minerals. Sometimes, the current owner does not own the minerals as at times, these are passed down through generations. In some instances, the owner will sell a small % of the minerals as an incentive for the sale of the surface. In regards to the environmental impact of drilling, safety standards are in place and enforcement of these standards are on both the State and Federal levels. This should not be a major concern as a land owner but make sure the proper agreements are in place with the oil company. In conclusion, unless you have found a great deal on both the surface and mineral rights, be aware of the monetary risks involved as the property might never see a well. I would advise to do some intense research into the matter and educate yourself on what all is involved in this investment.
Thank you so much for your advice, Charles. I am going to do some heavy research. I am planning another trip back there in 2013 and I am going to try to get some more information while I am there.