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PUBLIC NOTICE

DEPARTMENT OF ENVIRONMENTAL CONSERVATION

Proposed Acquisition of Conservation Easement from The Nature Conservancy, Inc. over certain lands located in the Towns of Long Lake, Webb and Piercefield in the Counties of Hamilton, Herkimer and St. Lawrence, New York.

Pursuant to Title 3, Article 49 of the Environmental Conservation Law, the Department of Environmental Conservation hereby gives public notice of the following:

Notice is hereby given, pursuant to Section 49-0305(9) of the Environmental Conservation Law, of the Department's intent to acquire a Conservation Easement from The Nature Conservancy, Inc. over certain lands located in the Towns of Long Lake, Webb and Piercefield in the Counties of Hamilton, Herkimer and St. Lawrence, New York.

For further information contact:
James Jensen, Superintendent
Bureau of Real Property
NYS Dept. of Environmental Conservation
625 Broadway, 5th Floor
Albany, NY 12233-4256
(518) 402-9442


Availability for Comments

Proposed Declaratory Ruling

"Non-Operator Lessees’ Entitlement to Working Interest Share of Production in a Drilling Unit Subject to a Compulsory Integration Order"

Pursuant to the provisions of the State Administrative Procedure Act (SAPA) §204, Notice is hereby given of the following action: in response to a Petition, the Department’s General Counsel is proposing to issue a declaratory ruling with respect to the extent of a non-operator lessee’s entitlement to a working interest share of production in a drilling unit subject to a compulsory integration order. Insofar as the Petition seeks a ruling specific to Langdon Hill Field, the General Counsel denied that portion of the Petition. Issues specific to Langdon Hill Field are more appropriately resolved in an administrative hearing.

Environmental Conservation Law (ECL) §23-0901(3) provides, in pertinent part, that the portion of the production attributable to each tract in a unit shall be deemed to have been produced from such tract by a well drilled thereon and that if one of the owners pays the expenses for the benefit of another owner, then such owner shall be entitled to the share of production accruing to such other owner, until the market value of such other owner’s share of production equals twice such other owner’s share of the cost.

The Petition requests a ruling that, irrespective of the size or location of the leased tract within a unit, where the lessee has been afforded the opportunity to share in well costs but has declined, the designated operator be entitled to receive the share of production attributable to such tract until the market value of the lessee’s share of production equals twice the lessee’s share of the cost of the well and, thereafter, the lessee shall be entitled to receive the entire working interest attributable to such tract.

The Petition also requests a ruling that, irrespective of the size or location of the leased tract within a unit, where lessee has not been afforded the opportunity to share in well costs, that the designated operator of the unit be entitled to the share of production attributable to such tract until the market value of the lessee’s share of production equals the lessee’s share of the cost of the well, and thereafter the lessee shall be entitled to receive the entire working interest attributable to such tract.

The General Counsel has determined that it is in the public interest to solicit public comments on the Petition pursuant to 6 NYCRR §619.1(e) with respect to the issues presented above. In addition to comments on the Petition described above, comments that specifically relate to the provisions under ECL §23-0901(3) will be considered, including the following:

1. When should the opportunity and decision to participate in well costs take place relative to commencement of actual drilling operations;

2. By what means should the non-operating interests receive any production to which they are entitled after the operator has recovered a designated percentage of costs attributable to their parcels; and

3. Should the ruling consider the applicability of the petition to an owner who has not entered into an oil and gas lease? If so, what other factors or issues should be considered?

Comments may include discussion of actual historical and current industry practice and implementation of similar statutes in other states.

Comment Period: Any interested persons and/or agencies desiring to express their views concerning the proposed declaratory ruling may do so by submitting their written comments. All submissions must be received no later than December 26, 2002. Submissions by mail, courier, and telecopier transmission will be accepted.

To obtain a copy of the Petition and to submit comments, please contact: Arlene J. Lotters, Esq., Division of Legal Affairs, NYS Department of Environmental Conservation, 625 Broadway, 14th Floor, Albany, NY 12233-1500; (518) 402-9222; fax (518) 402-9018; or visit http://www.dec.state.ny.us/website/dmn/BlackRiver/petition.htm