The oil and gas industry in Louisiana has a long record of, shall we say, shorting the state on tax dollars (when the state bothers to collect the taxes at all — See November 2013 Legislative Auditor’s report on Severance Tax Collections). According to this Pro Publica story, they also short landowners of royalty payments. Just some good ole boys! Chesapeake’s conduct is part of a larger national pattern in which many giant energy companies have maneuvered to pay as little as possible to the owners of the land they drill. Last year, a ProPublica investigation found that Pennsylvania landowners were paying ever-higher fees to companies for transporting their gas to market, and that Chesapeake was charging more than other companies in the region. The question was “why”? ProPublica pieced together the story of how Chesapeake shifted borrowing costs to landowners from documents filed with the U.S. Securities and Exchange Commission, interviews with landowners, people who worked for the company and employees at other oil and gas concerns. The deals took advantage of a simple economic principle: Monopoly power.
Posted on: Wed, 07 Jan 2015 21:37:59 +0000
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