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Pennsylvania DEP Readies Long-Delayed Forced Pooling Case

The Pennsylvania Department of Environmental Protection (DEP) has made a long-awaited decision to hold a special two-day hearing in Lawrence County later this month to gather input from stakeholders about whether Hilcorp Energy Co. should be allowed to create a forced pool drilling unit that would require landowners to share royalties.

In July 2013, Hilcorp filed a request with the DEP claiming it had a right to establish a drilling unit by pooling property on a 3,267-acre stretch of land straddling Lawrence and Mercer counties in Western Pennsylvania.

Hilcorp called on a decades-old law to justify its request, but the DEP said it did not have the authority to approve the request. Instead, the agency passed the case to the Pennsylvania Environmental Hearing Board, which ruled in November that the DEP had to make a final ruling on the issue before it could consider it (see Shale Daily, Nov. 21, 2013).

The state's move to assign attorney Michael Bangs as a kind of arbitrator in the matter is its first action since the hearing board ruling. Bangs is to hear testimony from area landowners, Hilcorp and state officials on March 25 and 26. He then would submit his findings to DEP Secretary Chris Abruzzo, who would make a final decision.

Hilcorp officials have not spoken publicly about the case. The producer wants to target a shallow portion of the Utica Shale in Pennsylvania.

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