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Drilling for Truth

In 1933 and 1934, Congress passed legislation to prevent fraudulent stock sales.

For decades, these laws have required publicly held companies, including drilling companies, to disclose any “material fact” to shareholders that could affect the purchase or sale of the companies’ stocks. (Securities Exchange Act of 1934, 13 Fed. Reg. 8,183, 8,184)

Since 1998, the agency has directed companies to make disclosures to stockholders “in plain English.”(68 Fed.Reg. 6383-Feb. 6, 1998).

When it comes to discussing risks, drilling companies clearly have a double standard–shareholders are warned, by law.  But no such legislation exits for landowners. This means that thousands of landowners may be signing legally binding contracts without understanding that their property, their health, their finances, and their communities could suffer serious harm, as stated to stockholders. The risks of gas drilling aren’t hypothetical. State officials in Colorado, Ohio, Pennsylvania and Wyoming have documented water pollution from natural gas drilling in recent years.  As far back as 1987, in a report to Congress, the U.S. Environmental Protection Agency detailed dozens of cases of gas and oil drilling-related contamination.

As Vito Mastrangelo, a Southern Illinois attorney states, ‘The oil and gas industry is engaging in a concerted public relations effort to convince the public that fracking is safe.  However, the evidence is overwhelmingly to the contrary.  The industry’s PR ignores the risks associated with fracking–risks to residents’ health and safety from air, water, and soil contamination. Landowners should be aware of these risks before signing a lease.’

If shareholders are warned of risks shouldn’t landowners have the same warnings?

Annette McMichael SAFE Media Relations Coordinator

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