Lawyers for EQT Production Co. have asked the West Virginia Supreme Court to reconsider a recent ruling affecting the payment of gas royalties within the state.
In response to a request by the U.S. District Court for the Northern District of West Virginia, in November the Supreme Court issued a ruling that gas companies could not take deductions out of royalty payments to mineral rights owners for production costs or other costs. Patrick Leggett and several other mineral rights owners had sued EQT, arguing the company was improperly deducting fees from their royalty payments.
Leggett, who owns a farm in Doddridge County on which EQT tends about 20 wells, said EQT had been deducting 25 to 30 percent of his royalty payments for years.
The ruling could have a significant impact on the oil and natural gas industries, because companies likely will have to pay more in royalties as a result of the decision. On Monday, Dec. 19, 2016, lawyers for EQT filed a petition for a rehearing in the matter.
In their petition, EQT's lawyers argue the Supreme Court erred in how justices interpreted the state laws regarding royalties in the case, misapplied an earlier Supreme Court ruling that found a gas company improperly took deductions and went beyond the scope of the question the U.S. District Court had asked justices to consider.
EQT wants the Supreme Court to withdraw their November ruling and completely rehear the case.
Justice Brent Benjamin, who penned the November ruling, is leaving office in January. By the time the Supreme Court considers whether to rehear the case, he will have been replaced by Beth Walker, who was elected in November.
Although judicial elections in West Virginia are now non-partisan, Walker campaigned as a conservative whom many expect to be friendly to business.
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