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Legislative Outlook 2011: West Virginia
December 31, 2010

by Michael J. Basile

The 2011 Session of the West Virginia Legislature promises to be one of the most interesting in the state's history. The passing of U.S. Senator Robert C. Byrd in 2010 has led to a series of corresponding leadership changes in West Virginia's state and federal delegations. Further, perceived incongruities between state succession laws and West Virginia's Constitution have led interested parties to seek input and clarification from the West Virginia Supreme Court of Appeals. The Court, in turn, has mandated a general election to be held no later than November 15, 2011.

With the above as backdrop, the oil and gas industry in West Virginia can expect increased near-term scrutiny from both the legislative and executive branches. The legislative interim committee process has produced an omnibus regulatory bill. The West Virginia Department of Environmental Protection has likewise produced - with input from a diverse stakeholders group originally empowered by then Governor (now Senator) Joe Manchin - an omnibus bill that it intends to introduce early in the session. Among the issues percolating in the above bills, as well as generally at the legislature, are: fee increases to fund permitting and inspection; water management; impoundment design and approval; surface owner notice and comment requirements; pooling, unitization and co-tenancy; and reclamation requirements.

Also, consensus is building among elected and industry officials toward some form of Marcellus Development Act aimed at stimulating economic opportunity atop production in the region. Current visions include focus on ethane cracking site locations to support the chemical and polymer industries in West Virginia and beyond, inducing natural gas vehicle infrastructure and usage, and extraction technology research and development incentive portfolios.

In short, these are exciting times in West Virginia - both as to politics and policy. And the above mentioned "Produce + Use + Here" shared vision has many - including me - excited about our future.

Bankruptcy & Creditors' Rights Michael J. Basile