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Couple Wants Pennsylvania Property Rights Case Dismissed

A couple from Susquehanna County, PA, at the center of a controversial mineral rights case wants the state's Supreme Court to throw out a lower court's ruling and end the anxiety shared by energy companies and landowners alike over uncertain ownership rights in the Marcellus Shale.

But an attorney representing John and Mary Butler in the case Butler v. Charles Powers Estate cautioned that it could be months before those anxieties are laid to rest.

"It could take several months," Gregory Krock, an attorney with the Pittsburgh law firm of Buchanan Ingersoll & Rooney PC, told NGI's Shale Daily on Tuesday. "There's no ironclad rule of when the Supreme Court has to make up its mind on whether it wants to allow the appeal."

Krock confirmed that the Butlers filed a petition for allowance of appeal to the Supreme Court on Friday, the latest step in their effort to overturn a Sept. 7 ruling by the state's Superior Court (see Shale Daily, Sept. 19).

At issue is who owns the rights to the natural gas locked in the Marcellus Shale formation under the Butlers' 244 acres in Apolacon Township. The land was last sold in 1881 and has a deed that specifies ownership of minerals and petroleum oils, but not natural gas. A Court of Common Pleas of Susquehanna County judge agreed with the Butlers' assertion that they owned the natural gas rights, citing the Dunham v. Kirkpatrick state Supreme Court decision from 1882.

"This case is about going back and deciding what was the parties' intent was back in 1881 when they used the term 'minerals,'" Krock said. "[Dunham] has been a long-standing law in Pennsylvania and presumes ordinary lay people, when they used the term 'minerals' in a conveyance of real property, considered that term to mean only metallic substances."

But the Superior Court disagreed and remanded the case back to Common Pleas Court, arguing that the appellants in the case should be given the chance to prove that the Marcellus Shale is a "mineral" and the treatment of shale gas should be the same as coal and coalbed gas, rather than the treatment afforded conventional oil and natural gas reservoirs. If this were proven, it would mean any Pennsylvania deed conveying "mineral" rights would include the shale and its gas, just as conveyance of the coal mineral includes the coalbed gas.

"The Superior Court, unfortunately, said they were not convinced at this early stage of the game that they could really rule, or that the case is over," Krock said. "We believe that the very evidence the Superior Court said should be considered is also the very evidence it has said is irrelevant in deciding what lay people intended."

Krock said the appellants in the case -- William and Craig Pritchard and the heirs to the Charles Powers estate -- had 14 days to file an objection to the appeal or any type of response.

Energy companies active in the Marcellus have been scrambling to determine whether their leaseholds are affected by the legal mess (see Shale Daily, Sept. 28). Two companies, Cabot Oil & Gas Corp. and Range Resources Corp., announced last month that their leaseholds -- and their companies -- should not be adversely impacted by the case.

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