Some 2,000 landowners in Pennsylvania will receive a share of $1.75 million and could get as much as $20 million over the next few years as part of the settlement of a federal class-action suit against a Texas-based gas company drilling in the Marcellus Shale.

Lawyers for Range Resources and an attorney for plaintiffs who said their royalty payments were improperly calculated by the company reached the settlement last week in U.S. District Court.

It now awaits the approval of U.S. District Judge Sean McLaughlin, although no timetable has been set.

The proposed agreement would give landowners who leased property to Range Resources an immediate $1.75 million. The exact payout after that isn't known because it depends on variables such as gas prices and other costs, but the settlement sets the amount at $28 million, with about $7 million of that going to attorneys' fees.

The plaintiffs' lawyer, Joe Altomare of Titusville, said he couldn't comment on the case because the settlement is pending.

Matt Pitzarella, spokesman for Southpointe-based Range Resources Appalachia, said the company is pleased with the settlement proposal because it will clarify the impact of the post-production costs of processing gas on any royalty payments in the future.

"We're very supportive and happy with the settlement," he said. "It gives us certainty moving forward."

The suit, filed in 2008 in federal court in Erie, said Range Resources improperly calculated royalty payments, improperly withheld management fees from royalties and didn't account to landowners for money it collected from selling oil and other by-products from gas processing.

The company denied the allegations and does not acknowledge doing anything wrong as part of the deal with the plaintiffs, standard language in settlements.

The proposed settlement would cover some 1.3 million acres of land in Pennsylvania and pertain to property owners who reached royalty agreements with Range Resources after Sept. 15, 2004.

The case, and dozens of others like it in Pennsylvania, drives home the need for landowners to do some research before entering into a lease with a drilling company.

"Every company has a different form of lease. It's hard to give general advice other than go see a lawyer," said Mr. Altomare. "The best advice, no matter how poor you are, is go to a lawyer before you sign anything."

Mr. Pitzarella said his company agrees, although he characterized the gas and oil industry as a partner in the education process, not necessarily an adversary.

"We recommend that everyone do their homework, educate themselves and talk to their neighbors," he said. "You need to find the right attorney and one that has experience in this area. The single most important thing is understanding the dynamics of gas development."

Some companies, he said, may offer a higher royalty -- the average is 15 percent -- than another company but not be able to process the gas, transport it or sell it as effectively as another offering a lower royalty.

While landowners and their lawyers are quick to blame chicanery on the part of gas companies and "landmen" hired to negotiate lease terms, the gas industry counters that many landowners bringing suits have only themselves to blame because their greed drove them to sign leases at a time when there was little competition for them.

When the demand intensified, such payments as bonuses for drilling rights spiked. Landowners found themselves stuck with their old lease terms while their neighbors reaped more lucrative deals, and they sued.

But such "buyers' remorse," the gas industry says, is a product of economic forces and not evidence of improper conduct on the part of the industry.

One of the most watched cases in this legal minefield was decided in March by the state Supreme Court in favor of the oil and gas companies.

In a 6-0 decision, the high court upheld a Susquehanna County judge's ruling that validated lease agreements that subtract drilling costs from the calculation of gas royalties.

In Kilmer v. ElexCo Land Services, Herbert Kilmer and other landowners wanted to invalidate the leases they signed with ElexCo and Southwestern Energy Production Co. before the Marcellus rush drove up land values. Their contention was that state law guarantees landowners 12.5 percent royalty from oil and gas production on their property.

The local judge ruled in favor of the companies, saying the law does not specifically prohibit the subtraction of costs before paying that royalty.

Mr. Kilmer appealed to Superior Court, but lawyers for the gas industry asked the Supreme Court to step in and settle the issue.

In writing the high court's opinion, Justice Max Baer said that a royalty is paid from the net amount remaining after production costs and well development are deducted.

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