Before Signing that Gas Lease, Ask About the Propane

A gas rig in West Virginia. (image: erjkprunczyk via flickr.com)

There is a list of questions being raised about the thousands of new gas wells that now dot the American landscape. (And The New York Times recently asked a lot of them in their Pulitzer-bound package on the national gas boom titled “Drilling Down.”)

But here’s a practical question for property owners who may be leasing their lands to an energy company these days: Can I get paid for the propane?

At the moment, natural gas is less valuable than its byproduct liquids (including propane, butane, and ethane). However, the agreement may not provide payment for these valuable natural gas liquids. “If you do not have a clause that says you get paid for the ‘wet’ gas, you may not get paid for it,” Tim Greene, owner of Land & Mineral Management of Appalachia, tells the Wheeling Intelligencer of West Virginia.

For property owners along the gas-rich Marcellus Shale in the state’s Northern Panhandle, leases range from $5 up to $4,000 an acre, says the Intelligencer.

To help local folks navigate some of the trickier parts of these land deals, Greene is leading a speaking series in West Virginia this month. Discussion points on the agenda include: the area of the lease, whether the company can install drilling infrastructure, and minimizing property damage.

Mountain State residents can check the schedule here.

(Visited 33 times, 1 visits today)