The Empire State Strikes Back: The Challenges Facing Mineral Owners & Producers Seeking to Profit in New York State
25 Pages Posted: 12 Dec 2015
Date Written: July 1, 2015
An analysis of how the current depressed oil and gas markets will weigh heavily against the likelihood that lawsuits or challenges are marshaled against New York State. Governor Andrew Cuomo's blanket prohibition against any type of hydrofracturing (A/K/A "fracking") without sufficient and specific evidence has rankled those living downstate upon the Marcellus and Utica shales, who could be profiting from leasing and production. This paper discusses valuations of minerals that would come up in any potential takings litigation, though ultimately the author concludes that expiring leases and a diminution of the relevant commodity prices will both serve to kneecap litigation, given that significantly fewer companies will have standing to litigate given that their leases are no longer active, and that the subsequently reduced potential valuation of subsurface oil, gas and minerals that are no longer economic to produce without fracking would likely preclude owners to pursue costly litigation.
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