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Private Contracts as Regulation: A Study of Private Lease Negotiations Using the Texas Natural Gas Industry

Published online by Cambridge University Press:  15 September 2016

Ashley Vissing
Ashley Vissing*
Affiliation:
Dept. of Economics at Duke University
*
Correspondence: Ashley Vissing ▪ Department of Economics ▪ Duke University ▪ 213 Social Sciences Building ▪ Box 90097 ▪ Durham, NC 27708-0097 ▪ Phone 919.660.1800 ▪ Email [email protected].
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Abstract

This study explores factors driving tract-level heterogeneity in the quality of leases executed by property owners who transfer their mineral rights to firms that drill for and extract natural gas. The data set consists of tract-level aggregates of lease terms, our measures of lease quality, and tract-level census data from the leases. We find that higher-quality leases are negatively correlated with higher concentration of minority households when controlling for census-tract-level characteristics. Based on the findings, we propose policies to reduce observed heterogeneity in the quality of leases and, subsequently, to reduce residents' exposure to negative effects of nearby well sites.

Keywords

hydraulic fracturinglease qualitynatural gas
Type
Selected Papers
Information
Agricultural and Resource Economics Review , Volume 44 , Issue 2: Special Issue: Unconventional Gas and Oil Development: Economic and Environmental Impacts , August 2015 , pp. 120 - 137
Copyright
Copyright © 2015 Northeastern Agricultural and Resource Economics Association 

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