[This article is about urban gas drilling in the first large urban field in the nation, Fort Worth, Texas. But lest you think it doesn't apply to you, think again. It will be coming to a shale bed gas field near you soon. The author is not a lawyer and nothing in this article should be construed as legal advice.]
You've been taken for a fool. You've signed a fraudulent contract. You were deliberately not given certain material facts about the contract that would have influenced you to throw it in the trash where it really belongs. This contract is, under contract law, unenforceable because of its fraudulent nature.
Here's the truth about your mineral lease.
Now that a large number of your neighbors have joined you in signing, your lessee has powers you never were told about. The lessee can essentially do whatever he wishes on the surface to produce the gas under your property. He can hold your property hostage at his discretion for decades by performing inexpensive, non-productive tasks as provided by the contract. Much of his power depends on his stated reasons for his actions--reasons that you cannot challenge with any degree of hope for success and that will cost you dearly in legal fees if you do. He can, and from all historical evidence will, pollute any surface location where he installs mineral extraction equipment. He does not care what you think about it.
Perhaps more ominous is the fact that he is not limited to extraction of minerals from a specific formation (e.g., the Barnett Shale) but may explore for deeper minerals that are said to be known to exist under the Barnett Shale. In South Texas his brethren are still holding leases executed in the 1930s, 75 years ago, leases that have polluted the surface and made it unusable for its original purpose of cattle ranching. Although the original target minerals have largely been removed, these lessees are now exploring for and producing gas on these properties. Surface equipment that is no longer functional still leaks carcinogens into the ground, and leaky pipes produce liquid and gas that come to the surface. The surface rights owners have been denied access to areas on their property by the lessee, and the lessee is presently suing the surface rights owner in court for various violations of the lessee's rights. So, while you've been told verbally that there'll be no effects on your surface usage, that is not an enforceable contract provision, and the lessee knew it when he asked you to sign.
Your partner in the lease didn't tell you that in order to produce the gas he desires there will have to be a gas drilling pad with multiple wells on it and peripheral equipment that will require large truck service daily throughout the life of the wells, and that this drilling pad will be allowed to be located less than 300 feet from homes. They did not tell you that each drilling pad will require a 16 inch steel gas gathering line to carry away the gas to a processing facility, and that the right of way for this line will be taken by eminent domain if necessary, and the line will lie within perhaps 20 feet of home foundations without regard to the possible presence of enclosed spaces under the homes that can cause accumulation of unodorized gas and subsequent explosion.
They did not tell you that the gas in the gathering lines is the most corrosive form of natural gas there is and that it has corroded through such installations in 3.5 years with catastrophic fatal results. They did not tell you that their plan to install these pipelines by horizontal drilling through front yards at a depth of about 20 ft would not protect you from an explosion due to corrosion and leaks. In fact, the burying of the pipeline makes inspection more difficult and possible only with instruments too expensive to be affordable by secondary operators who will be buying out the original drillers within 5 years of installation. And these instruments do not detect all corrosion. Only those types of pipeline anomalies for which the instrument was specifically designed can be detected and identified as problems. Thus we had the Appomattox pipeline explosion of 2008.
Your lessee did not tell you that in the four years from 2004 through 2007 there were 9 reported gathering line incidents in the Barnett Shale that satisfied the federal criteria for "significant incidents". These criteria include any of the following--fire, explosion, human injury or death, $50,000 or more in damage, or mass evacuation. The fact that there were 9 such incidents reported in the Barnett Shale implies that when industry and the City of Fort Worth have enabled a full build-out of the gas field underlying Fort Worth there will be, statistically, on average, one significant incident inside the city limits of Fort Worth every six months.
They did not reveal any of this when they approached you and asked you to sign their Producer's 88 lease.
The City acted as a co-conspirator in this fraud by approving the industry's activities and helping the industry to promote a bandwagon atmosphere promising free riches to every mineral rights owner in the city. They continue to support and defend the industry's activities here and have entered into questionable leases of our parkland. They have ignored a provision prohibiting such installations in every zoning category except heavy industrial and have passed a new zoning ordinance that permits gas drilling and gas gathering processing and pipelines in every zoning category in the city. They have allowed Chesapeake to use city buses to promote their fraudulent activities and propagandize the public, and they have knowingly denied the dangers both of the pollution and the "significant incidents" that are sure to come.
Elected City officials have summarily ignored public safety and public health criteria, the backbone of the state zoning code, in favor of asserting the primacy of mineral rights over all other rights. While they pretend that their 600 ft set-back provision is a safety measure, it was included in the gas drilling ordinance with absolutely no scientific or engineering data as back-up for the distance specified, and on September 1, 2009 the City Council showed the ultimate contempt for that phony provision, abusing its stated intent by permitting Chesapeake to create a multiwell drilling pad within 600 feet of 48 "protected use" properties when Chesapeake was only able to secure 9 waivers from owners of protected use properties. Thus this permit was issued when 39 at risk owners refused to sign a waiver.
So you can see where this is all leading.Significant Incidents--Their significance to you
What do you think is going to happen when we have the next incident in Fort Worth like that in Forest Hill, a Fort worth suburb, in 2006? Well, let me give you some idea. First, there will be hand wringing at the Fort Worth City Council and dancing about to try to manage the public reaction. "Whoops! Oops! We didn't know! Everyone followed all the rules. This is just an act of God, an unfortunate rare occurrence that nobody could have foreseen!"
Next, the fire marshal will be questioned as to why he did not come before Council and state his concerns about these pipelines being placed so close to houses with pier and beam foundations. The New London School explosion of 1937 will be mentioned.
Next will come the insurance industry with eyes bugged out. "This was forecast. Now it has happened, and the math says it is likely to happen here with a regularity that we cannot afford. Therefore, homeowners in Fort Worth will have to buy an extra rider on their mortgage insurance, and we have calculated the cost of that to be"" (You don't want to know.)
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