Sunday 19 Jan 2020

Cooper Halts Fracking Leases

FrackingAs North Carolina moves forward with fracking to extract oil and gas, landowners need to learn about their rights and protections under the law, says Attorney General Roy Cooper.

Cooper’s Consumer Protection Division is currently investigating one company that pushed potentially illegal fracking leases on landowners in Durham County. The company, Crimson Holdings of Pennsylvania, proposed paying landowners $5 per acre to explore for oil and gas on their land.

The Attorney General’s Office wrote to Crimson Holdings July 28 demanding that it cease offering or entering into oil and gas leases in North Carolina until it can prove that it is complying with state laws. The letter pointed out several problems that could potentially violate state law, including that the company isn’t registered to do business in North Carolina and that its leases appear to last for more than 10 years, fail to give consumers the right to cancel, don’t seek approval of the property owners’ mortgage lender, and lack educational information required by law.

Crimson Holdings responded that it will change its leases to comply with North Carolina law. According to the company, it sent leases to more than 1,500 North Carolina property holders, though it was unclear Monday if any had been signed and returned.

Cooper offered some tips for consumers considering leasing their land for oil or gas exploration:

• Contact an attorney. Before you sign an oil or gas lease, contact an attorney and ask them to review it, especially provisions about payment and damages

• Contact your mortgage lender. If have a mortgage loan, signing an oil or gas lease could violate the terms of your mortgage. It could also prevent you from being able to refinance your mortgage in the future.

• Check out the landman. Oil or gas leases are often offered by salesmen called landmen who are required to register with the NC Department of Environment and Natural Resources. Check out a landman with DENR online or by calling 919-707-8605.

• Research the company. If you lease your land to a company for oil and gas exploration, you’ll be dealing with that company for years to come. Before you sign a lease, check with the North Carolina Secretary of State’s office to find out if the company is registered to do business in North Carolina.

• Get all promises in writing, and get a copy of your lease. Make sure any promises or conditions you discuss are in writing and are part of the lease. Also, be sure to get a copy of your lease.

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