Monday, February 16, 2009

House committee caps citizen rights not gas wells

Eminent-domain Bill Dies in Committee
By Arkansas Business Staff - 2/11/2009 3:15:01 PM


A bill restricting private oil and gas companies from claiming eminent domain failed to make it out of a House committee on Wednesday.

HB1178 by Rep. Jonathan Dismang, R-Beebe, went before the House Committee on Agriculture, Forestry and Economic Development but was killed on a 9-6 vote.

The bill clarified that a pipeline company does not have the authority to exercise the power of eminent domain for the purpose of the construction or operation of a gathering line. Dismang said the purpose of the bill was to provide landowners the ability to effectively negotiate with oil companies over the location of gathering lines and well sites.

The bill is a response to the activity in the Fayetteville Shale play.

More analysis from Capsearch.com Here: http://www.capsearch.com

February 11, 2009
Rep. Dismang’s Eminent Domain bill fails in committee
Filed under: Uncategorized — Matt Price @ 3:11 pm
HB1178 from Rep. Jonathan Dismang went before the House Committee on Agriculture, Forestry and Economic Development today. The bill clarified that a pipeline company does not have the authority to exercise the power of eminent domain for the purpose of the construction or operation of a gathering line. Rep. Dismang stated that the purpose of his bill was to grant landowners the ability to effectively negotiate with oil companies over the location gathering lines and well sites. Mr. Don Rainey, an attorney in Searcy, Arkansas testified that he has represented landowners in White County for over 30 years and that he did not believe oil and gas companies should have the power of eminent domain for gathering lines and well sites. Mr. Rainey stated that prior to enacting A.C.A. §23-15-101 the power of eminent domain had never been granted by the Arkansas Legislature to unregulated private corporations.

Mr. Jerry Canfield, Esq., an attorney for Chesapeake Energy, spoke against the bill. Mr. Canfield stated that Article 12, Section 9 of the Arkansas Constitution allowed the power of eminent domain to be given to privately held corporations. Within Chesapeake’s business, the process of “Unitizing” pipelines was essential to the effective transport and production of natural gas. Mr. Canfield further stated that private condemners pay full value of the property easement even if the condemner takes only the easement and not the full fee.

Representatives of groups including the Fayetteville Shale Citizens Association, White County Farm Bureau, Arkansas Conservation Alliance and Arkansas Farm Bureau spoke in favor of the bill while several royalty owners spoke against the bill. Of particular note were statements made by Kenneth May, President of the White County Farm Bureau and Rodney Baker with Arkansas Farm Bureau. Mr. May stated that his 6,300 member group took up the issue of oil and gas companies eminent domain power and at a December meeting unanimously voted to support HB1178. Mr. May said that the complete unanimity with which his group supported this bill and the fact that the bill was being addressed today demonstrates that a real problem exists. Though conservative, Mr. Baker said that Arkansans recognize that there is a need for eminent domain. However, in this instance, Mr. Baker stated that the Arkansas Farm Bureau saw the use of eminent domain as Chesapeake taking advantage of the Arkansas Code to avoid regulation while simultaneously obtaining the power of eminent domain.

The final vote was 9 votes against and 6 votes for HB1178.

FOR: Sample, King, Rice, Dale, Betts, Nickels.

AGAINST: Everett, Reep, Davenport, Wills, Lowery, Cash, Reynolds, House and Patterson.

1 comment:

MikeB said...

Interesting that many states (including Texas, Virginia, Delaware, Missouri, among others) have joined the property rights movement to challenge the status quo of eminent domain. As this posting indicates, it is still an uphill battle.

Speaking as someone actually fighting eminent domain in federal court with Houston-based Spectra Energy, I can confirm that, nowadays, eminent domain has less to do with projects for the "public good," and everything to do with the financial good of publicly held companies.

In Bedford County, Pennsylvania (2 hours from Washington), property owners are being hauled into federal court by Spectra Energy, backed by the power of the Federal Energy Regulatory Commission.

The landowners' property is sitting on top of the gas-rich Marcellus Shale; but they can't develop that because Spectra Energy wants to use the Oriskany sands layer for an underground gas storage facility.

Here is the great puzzle of eminent domain: property owners possess the key asset that companies and government covet – the land. But they are treated as a waste product in this process rather than as key stakeholders.

For info: http://www.spectraenergywatch.com/blog/