Replies to This Discussion

Permalink Reply by Max on December 23, 2012 at 6:51

One has to admit, finding income for local governments has become an art.  It makes common sense for dollars produce in a give location to benefit that location's needs.  Receiving an greater percentage of the tax upfront instead of asking for those tax revenues back from the State, puts more control in the hands of local folks.

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Permalink Reply by Skip Peel - Mineral Consultant on December 23, 2012 at 15:06

IMO the energy industry should lobby for a temporary discount to the severence tax in exchange for direct assistance to local municipalites for the maintainence and upgrade of existing roads in areas of active development.  The citizens of the county or parish and the operating companies have a shared need for usable roads.   The state does not.  And trying to get money back from the State of Louisiana at this time is a waste of time.  The industry needs to improve its public perception and be seen as a responsible partner in the exploration and production of minerals.  A closer working relationship with the representatives of the residents/land owners most affected would be a postive move when the industry needs public goodwill and support for issues such as hydraulic fracturing.  The industry too often comes off as detached or, worse, arrogant.  PR has never been their strong suit.

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Permalink Reply by Hopeful About Natural Gas on December 23, 2012 at 16:45

I don't know the laws in Louisiana, but in my state landowners who did NOT have a well drilled would be p.o.'d about the damage to roads they have to drive on.

If the state does not fix the roads and the parish does not then who does that leave?  The company?  Homeowners?  Or, the landowners who have wells on their property?  After all, the trucks and work needed to work the wells could have really sped the destruction of the road. I don't know the laws in Louisiana but I could easily see that happening in most states in the West.

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Permalink Reply by Skip Peel - Mineral Consultant on December 27, 2012 at 7:45

Coordination between local municipalities and the industry is much more straight forward and cost effective for all the stake holders.  E&P companies have working relationships with subcontractors that build roads and pads and with material suppliers.  The industry builds very good roads both aggregate and asphalt.  Local municipalities have some monies for road maintenance and the ability to grant short term sales tax discounts.  I an unaware of any attempts by the industry to negotiate a working relationship with a municipality in regard to solving the challenges of rural roads woefully short of adequacy when it comes to heavy truck traffic but I consider it both possible and prudent.

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Permalink Reply by Jo Ann Carter on December 27, 2012 at 9:04

Now ya'll be careful because you will give CHK another idea about how to take more deductions  from our royalty checks.

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Permalink Reply by Skip Peel - Mineral Consultant on December 27, 2012 at 11:42

Jo Ann, IMO it is helpful to recognize that CHK is quite often a special, and separate, case from the rest of the industry.  A good bit of litigation involving CHK should make it to court in 2013 and those ruling will have significance for the company and its lessors.  The wider industry will hopefully begin to appreciate the value of PR and the goodwill of the public and move to make exploration and production less intrusive and costly for locals.  That is one of my New Year wishes.

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