By Joshua
Schneyer and Brian
Grow
TRAVERSE CITY, Michigan (Reuters) - Late in the summer of 2010, hundreds of
farmers in northern Michigan were fuming.
All had signed leases with local brokers permitting drillers to tap natural
gas and oil beneath their land. All were demanding thousands of dollars in
bonuses they had been promised in exchange. But none knew for certain whom to go
after.
That's because the company rejecting their leases hadn't signed them to begin
with. In fact, the company issuing the rejections wasn't much of a business at
all. It was a shell company - a paper-only firm with no real operations - called
Northern Michigan Exploration LLC.
One jilted land owner, Eric Boyer-Lashuay, called to complain to the broker
who had handled his lease. Northern, he recalls saying, is "a shell company ...
a blank door with no one behind it."
Today, he puts it this way: "It was all a fake, all a scam."
Northern has voided hundreds of land deals, and was indeed a facade - a shell
company created so that one of America's largest energy companies could conceal
its role in the leasing spree, a Reuters investigation has found. Oklahoma-based
Chesapeake Energy Corp., the nation's second-largest gas driller, was behind the
entire operation.
Chesapeake had created one shell company that set up another, Northern
Michigan Exploration. Next, Northern hired brokers who signed leases with
residents such as Boyer-Lashuay. And those brokers were under strict orders not
to divulge Chesapeake's role, records reviewed by Reuters show.
In fact, the effort in Michigan was directed from the very top - by
Chesapeake's CEO, Aubrey McClendon. In corporate filings that Chesapeake made
public earlier this year - nine months after McClendon's agents began signing
Michigan land leases - McClendon is named as the chief executive officer of
Northern, the shell company that voided hundreds of those leases.
Chesapeake's effort to hide its involvement isn't illegal. To the contrary,
the company's maneuvering exemplifies how U.S. corporations routinely can
conceal financial and corporate transactions through the use of shell
companies.
President Barack Obama has called on other nations to improve corporate
transparency, but under state laws governing corporate formation in America,
privately held businesses aren't required to disclose the individuals or
companies who really own them.
Chesapeake's own website advises land owners that their "main consideration"
before leasing should be "to discover who will ultimately be producing your
minerals." But Chesapeake's strategy made that extremely difficult for the
Michigan land owners.
Legal scholars say the operation serves as an intriguing test case of the use
of shell companies.
The tactics "raise moral and ethical questions about how entities can be
used," says Joshua Fershee, a contract law professor at the University of North
Dakota.
Others, including Chesapeake, defend the need to use shell companies and
front companies - contractors with local ties who do business on behalf of a
larger corporation. John Lowe, a professor of energy law at Southern Methodist
University, calls it "business as usual."
"Shells aren't just a device to pull the wool over land owners' eyes," Lowe
says. "You have to weigh some of the unfortunate cases against the fact that
these companies can facilitate doing business, making it easier and probably
cheaper to obtain leases. If I were a regulator, I'm not sure I'd change
anything or try to limit the use of shells."
At least one lawmaker, Rep. Raul Grijalva, a Democrat from Arizona, says he
will be "arguing for some intervention" to control the use of shell companies in
such deals.
"Private property owners who enter into these transactions with good faith
shouldn't be getting duped by a front company," says Grijalva, a member of the
House Committee for Natural Resources. "It's deception and you can't call it
anything else. It's a good example where the intervention of government to
require disclosure and binding contracts is needed."
INTENT TO RENEGE?
The effort to secure leasing rights in Michigan was part of Chesapeake's
national "land grab," a term the company has used in its filings with the U.S.
Securities and Exchange Commission.
But Chesapeake's Michigan land rush quickly ended. In court this month,
lawyers for land owners alleged that lease agreements were voided after
Chesapeake learned a well it drilled in the state had come up dry.
Bonuses promised to land owners went unpaid, according to court documents
submitted by lawyers for the land owners. Northern Michigan Exploration, the
Chesapeake-affiliated shell company, rejected more than 97 percent of the leases
its Michigan agents had signed with farmers and other land owners, the documents
allege.
More than 800 Michigan land owners - many of them elderly farmers - had their
leases terminated by Northern, Reuters found.
As a consequence, owners missed opportunities to lease their land to other
oil firms. At least 115 have sued, alleging that Chesapeake breached their
contracts and defrauded them. On average, they each had been expecting $95,000
in bonuses, those lawsuits show.
The near-blanket cancellation of the contracts raises the question of whether
Chesapeake ever intended to pay if it failed to find oil or gas immediately,
says Mark Gergen, a contract law professor at the University of
California-Berkeley law school.
"It suggests they might have had a strategy going in of not honoring their
agreements," he says. "The shells would have facilitated that" because
Chesapeake could blame the shells for the cancellations, suffering no damage to
its reputation.
Chesapeake says it acted properly. It says some land owners were paid
bonuses. It also disputes "canceling" any Michigan contracts; rather, some
contracts were "rejected" because property titles didn't pass muster, its
corporate counsel says.
In written responses, Chesapeake says it sometimes uses shell companies to
"keep a low profile" and avoid tipping off competitors and "speculators" about
its land-leasing and drilling efforts. Such tactics are common in real estate,
scholars say.
But now, Chesapeake also is using shells as a legal defense to shield itself
against land-owner lawsuits. The energy giant has said in court that it was
Northern Michigan Exploration, not Chesapeake, that canceled the
leases.
If land owners prove that they should have been paid, at issue is who will be
held accountable: Chesapeake, a corporation with $37 billion in assets, or
Northern, a shell company with no publicly documented assets.
"If Chesapeake knew from the start there was a good chance it would renege on
leases and used (Northern) to avoid liability, that is improper," says North
Dakota law professor Fershee.
The burden now rests with lawyers for the land owners to prove that - to not
only demonstrate that Chesapeake was directing the shell companies but also to
show that Chesapeake used the shells to commit fraud.
STAYING HIDDEN
To understand the role shell companies play in Chesapeake's business, Reuters
reviewed hundreds of pages of lease agreements, rejection letters and contracts,
and more than a thousand pages of court records.
Reporters also interviewed more than three dozen land owners, lawyers and
"landmen," those who scout for areas rich with oil and gas and strike deals with
land owners.
The northern part of Michigan has a long history of smalltime drilling. But
the three-month land-leasing frenzy here last year was driven by speculation
that the state's Collingwood Shale area might hold large amounts of oil and
natural gas.
In recent years, shale drilling has created the biggest grab for resources in
the U.S. since the California Gold Rush. Thousands of so-called "shaleonaires"
have grown rich by leasing their land and collecting royalties from
gushers.
Chesapeake is the single biggest player in that rush, employing about 4,500
landmen. Its CEO, McClendon, started his career as an oil landman, as did former
President George W. Bush.
Chesapeake says it has paid more than $9 billion for land leases. Its
holdings include about 15 million acres in at least 23 states - a drilling area
nearly the size of Ireland. Since 2008, Chesapeake has raised $13 billion by
selling off a portion of those leases to energy firms as far away as China and
Australia.
The business is risky. Chesapeake often slips into a shale play early,
committing hundreds of millions of dollars before it knows whether wells in the
area will be gushers or dry holes.
RISKY PROFILE
The company's filings show it spent $6.95 billion acquiring "unproved"
properties last year, more than double what it spent the previous year.
Such huge spending, coupled with U.S. natural-gas prices at 27-month lows,
underscores Chesapeake's aggressive financial risk profile, according to
Standard & Poor's. It rates Chesapeake's corporate debt BB+, a category
considered junk status.
Some analysts balk at the difficulty of following the company's land
transactions, including deals made through shell companies. The use of shells
can make the moves hard to trace in financial statements.
In October, Reuters asked Chesapeake about its land-leasing in Michigan. In a
written response, Chesapeake said then that it had spent about $400 million to
acquire leases there, a figure it has neither disclosed nor is required to
disclose in SEC filings. Company spokesman Michael Kehs declined to answer other
questions submitted this month.
Left unanswered: Whether shell companies affiliated with Chesapeake have any
assets.
"There are red flags when it comes to Chesapeake's transparency, convoluted
ownership of shell entities and transactions shareholders can't see," says Phil
Weiss, an equities analyst with Argus in New York, who downgraded the firm's
shares to 'sell' on November 16. "I'd never know what happened in Michigan by
looking at Chesapeake's filings."
SHELL OF A SHELL
Chesapeake's land strategy was pieced together in part from documents that
emerged in the Michigan lawsuits. Since early in the legal fight, Chesapeake has
denied it conducted business in Michigan. It also denied that Northern, the
shell company that voided leases en masse, was its "wholly owned
subsidiary."
For months, plaintiffs' lawyers couldn't figure out how Chesapeake could
seemingly deny direct control of Northern. The answer lies behind the corporate
veil of shell companies.
Chesapeake doesn't directly own Northern; rather, Northern was incorporated
by another shell company - one that Chesapeake owns and had created a year
earlier. That firm, LA Land Acquisition, is the beginning of a complicated chain
of shells and front companies - local contractors - operating on Chesapeake's
behalf:
* In April 2009, Chesapeake begat LA Land Acquisition Corp., a Delaware
entity with no discernible assets.
* A year later, in April 2010, LA Land formed Northern Michigan Exploration,
another shell company with no known assets.
* Northern subsequently hired a local land-lease company, O.I.L.
Niagaran.
* O.I.L. then hired another local company, Western Land. Both O.I.L. and
Western negotiated with land owners here.
The firms agreed not to disclose the energy giant's role to land owners,
according to a May 2010 contract between Chesapeake and O.I.L. and other records
reviewed by Reuters.
In incorporation papers filed in Michigan, Northern's address is listed as
the office of a law firm in Lansing. John Pirich, a Lansing lawyer listed in
state records as the representative of Northern, declined comment.
The connection between Chesapeake, LA Land and Northern appears in a February
8 SEC filing, made public five months after Michigan land owners first filed
suit. It shows that LA Land, which lists McClendon as a director, is the "sole
member" or owner of Northern, which lists McClendon as its CEO.
Chesapeake didn't say why it used multiple intermediaries in Michigan.
Lawyers say layers of shell and front companies can be used to cap liability
when the companies behind the shells face lawsuits.
"The shells can complicate and delay things," says Gergen, the Berkeley law
professor. "Chesapeake is probably betting that plaintiffs won't have sufficient
resources or staying power to collect."
DRILLING RACE
Last year, Chesapeake was competing for land in Michigan with the Canadian
driller EnCana. In May 2010, EnCana announced that it had already leased 250,000
acres in the state.
Sue Brown, who owns 370 acres near Cheboygan, Mich., was bombarded with
offers. "Landmen swooped in on this area like hornets out of hell," Brown says.
"They'd be waiting in my driveway, completely paranoid that I was going to sign
with somebody else."
That month, she and her husband were among the earliest farmers to sign a
lease with a local broker working on behalf of Chesapeake. They received a
$500-per-acre bonus.
Brown's contract featured a non-disclosure clause, forbidding her from
revealing her offer to neighbors. She had no idea Chesapeake was behind it. The
lease has been honored, she says.
As the frenzy intensified in June 2010, some Michigan bonuses rose to $3,000
an acre, up 200-fold from before the boom. Chesapeake's decision to remain
hidden may have been a legitimate attempt to keep prices from going even higher,
some experts say.
"It's common to take leases through a shell corporation or through a landman
company," says Lowe, the professor of energy law at SMU's Dedman Law School in
Dallas. "If you're a farmer or a rancher and you see a big, deep-pocketed oil
company pull up in your driveway, then your price goes up."
'DRY HOLE,' ABRUPT SHIFT
After prices surged in Michigan, EnCana decided in July 2010 to pare back its
leasing effort, a company spokesman says. According to allegations in several
lawsuits against Chesapeake, CEO McClendon looked to take advantage of the
opening.
He began to aggressively renegotiate or delay the completion of his own
Michigan deals, the lawsuits allege.
The lawsuits by Michigan land owners also suggest a specific reason why
Chesapeake's interest cooled: Through an affiliate, Chesapeake drilled an
exploratory well in Michigan last July that came up dry. Chesapeake has not
publicly disclosed the drilling results and declined to comment on the matter.
But in the weeks after the exploratory well was drilled, Chesapeake's
shell-within-a-shell - Northern - began rejecting leases en masse, letters sent
to land owners show.
In some cases, Northern claimed that land owners missed a signing deadline,
even though landmen had told them when to sign. Leslie and Sarah Schrier, a
farming couple in their 80s who live near Brutus, Mich., had their lease voided
weeks after a landman and a notary public drove to their farm to watch them sign
ahead of the deadline, they say.
Also affected was John O'Hair, a former judge and chief county prosecutor in
Detroit. He leased his 140-acre family farm in Antrim County, Mich., to O.I.L.
in a contract that offered an $84,000 signing bonus. If successful wells were
drilled, the O'Hairs would receive 12.5 percent royalties.
O'Hair had leased the same land to O.I.L. a few years earlier without a
hitch. This time, months passed and no bonus check arrived.
O'Hair complained to O.I.L.'s president, Dwain Provins. The response: O.I.L.
was working for another firm, whose name and role were secret, O'Hair recalls.
That firm had voided the lease, he was told, because one of O'Hair's in-laws
appeared to own a stake in his property. Provins declined comment.
"It was a completely bogus claim," says O'Hair, 82. "I'd leased the land
previously to O.I.L. with no issues."
More months passed before O'Hair learned the truth from lawyers he had hired:
O.I.L. was doing the bidding of Northern and Chesapeake.
By August 10, 2010, transcripts from court hearings show, at least one of
Chesapeake's middlemen in Michigan seemed regretful that he had entered into
business with the company.
The broker, David W. McGuire of O.I.L. Niagaran, voiced concern about
Chesapeake's directives, court records indicate. He told McClendon that
Chesapeake was asking O.I.L. to default on contracts that Chesapeake never
intended to pay, according to the court records.
McGuire told McClendon that he had "never been put in a position like this,"
court records show. His comments were recounted in court this month by lawyers
representing land owners.
McGuire did not respond to requests for comment on the matter.
LETTERS CONNECT SHELL, CHESAPEAKE
By mid-August, Northern began sending out rejection letters to land owners.
Many were signed by the man listed as Northern's "senior landman," David W.
Bolton. He also was a landman for Chesapeake itself. In an email exchange with
local brokers, he used the address dave.bolton@chk.com - a Chesapeake address.
He's also on a 2010 list of Chesapeake employees.
Bolton did not respond to email or phone messages requesting
comment.
The lease-termination letters from Northern were a giant ruse, says Kevin
Koonce, a landman who worked for a Chesapeake contractor in Michigan.
Koonce says he worked in Michigan from September to November 2010. He wasn't
there to lease land. By the time he arrived, Koonce says, Chesapeake's strategy
was to abandon leases it had already signed.
"Our instructions were to flunk the title if there was a word misspelled,"
Koonce says. He says he decided to speak publicly about the situation because he
objected to the approach.
Emails reviewed by Reuters show Koonce's firm was fired in December 2010 for
not signing any land owners to drilling leases in another state. He has filed an
affidavit on behalf of Michigan land owners who are seeking to collect on their
leases.
Koonce says his instructions to flunk leases came from a supervisor at
another broker working for Chesapeake in Michigan. Koonce says he and eight
other brokers participated in a conference call on October 27, 2010, with the
supervisor. During the call, he says, they were ordered to speed up the rate of
lease cancellations.
Neither the supervisor nor the other brokers on the call responded to emails
requesting comment, and Chesapeake declined to comment on Koonce or his
allegations.
One land owner whose lease was rejected was Mildred Lutz, a 93-year-old widow
who lives near Alanson, Mich. She says she was told her $97,000 bonus wouldn't
be paid because her late husband didn't sign the lease and the family trust,
which owned the land, is in both her name and her husband's. Never mind that the
landman drafted the lease in July 2010 - a month after her husband's
death.
"He knew my husband had passed away and I would be the sole owner of my
property," Lutz says. Chesapeake's lawyers have said the Lutz lease had clear
formatting and title flaws.
In its letters to land owners, Northern offered several reasons for voiding
leases: disputes over property ownership; improper formatting of leases; and
claims that properties fall outside a geographic target area.
In some cases, Northern claimed that land owners had missed a signing
deadline, even though they signed leases at a time and place specified by the
company's leasing agents.
In scores of other letters, Northern says leases were void because of
"unsubordinated" mortgages on property. That means a property - like the
approximately 70 percent of U.S. real estate that is mortgaged - isn't owned
free-and-clear.
In a written statement, Chesapeake general counsel Henry Hood says a mortgage
is a valid title defect "if the mortgage pre-dates the lease and is not
expressly subject to and subordinate to the lease." In previous filings with the
SEC, Chesapeake said it generally scrutinized titles late in the process, before
drilling, and not before paying out bonuses.
Chesapeake's main competitor in Michigan, EnCana, told Reuters that it
honored the vast majority of leases it signed in the state and has faced no
lawsuits that allege it reneged on any leases there.
EnCana "very rarely" voids any lease it has signed, spokesman Alan Boras
says.
LOW PRICES, GOOD DEALS
As Northern continued to reject leases, another company emerged in late
October and went on a Michigan land-buying spree.
The hundreds of rejected leases had depressed land prices from the summertime
high, and a company called Crystal Lake Resources became one of the top buyers
of public land at a state auction on October 26, 2010.
The state land up for auction was also in the Collingwood Shale formation,
not far from the land that Northern no longer wanted to lease from private land
owners.
According to records from the Michigan Department of Natural Resources,
Crystal Lake bought drilling rights on 30,000 acres for $20.97 an acre. That's a
99 percent discount on the price promised to some land owners whose leases were
canceled by Northern.
Incorporation records show Crystal Lake was formed on October 25, 2010, a day
before the public auction. Its Lansing address is the same as Northern's, the
Chesapeake shell company that had been canceling private leases.
In a response to one Michigan lawsuit, Crystal Lake Resources is identified
as a lease buyer for Northern.
In the months since its Michigan buys, Crystal Lake has also been busy
signing land leases in at least one North Dakota county.
There, in Hettinger County, clerk Sylvia Gion says Crystal Lake's leases have
been assigned to one company: Chesapeake.
Thursday, March 29, 2012
Infrastructure protection sought
March 28, 2012
,
Tribune Chronicle |
TribToday.com
WARREN - Gas and oil well drilling companies say activity could begin in
Trumbull County as soon as sometime in the next six weeks, according to the
Trumbull County Engineer's Office.
And when it's time for the heavy machinery and trucks to begin rolling over roads, bridges and culverts, officials want to be prepared, which is why an agreement is being readied to protect the county's infrastructure.
Conversations between the engineer's office and two drilling companies so far indicate wells will be drilled on property near the intersection of Warner Road and Warren Sharon Road in Vienna; on property along Ridge Ridge, also in Vienna; and ground on Hayes Orangeville Road in Hartford.
The talks have been with Consol Energy, based in Canonsburg, Pa., for the Warren Sharon Road property and with Carrizo Oil and Gas, out of Houston, for the other property in Vienna and on the land in Hartford.
It doesn't appear that permits have been issued, according to the Ohio Department of Natural Resources website.
But it was talks with the engineer's office, where it's been indicated drilling activity could commence sometime in the next month to six weeks, said Don Barzak, engineer's office director of governmental affairs and grants and special projects coordinator.
So today, county commissioners are expected to approve a model roadway use and maintenance agreement that can be used by the county and cities, villages and townships in the county to provide for repair and maintenance of infrastructure hurt by drilling activity.
''It's important we have an approved document in place to protect the infrastructure of the county,'' Barzak said.
There will be a meeting today for local officials to learn about the agreement, for which work began in January.
In part, it calls for operators to post a bond to cover the costs of damage caused activity related to drilling. Bond amounts would be announced today, however, Barzak noted that it would cost about $516,000 conservatively to build, from scratch, one mile of road.
Bond amounts will vary. Companies who agree beforehand to address infrastructure improvements, based on approved engineering, to accommodate for damage caused by drilling-related activity will have a lower bond. Those who don't, their bonds will be higher, Barzak said.
Engineer Randy Smith called the contracts ''boiler plate agreements'' that can be used by all the communities, but they are flexible enough to make sure individual community concerns are addressed in an appendix.
Barzak said the office also plans to take pictures and video of the roads before drilling activity for a log. ''We expect our road system to be left in the same shape it was then they found it,'' Barzak said.
And when it's time for the heavy machinery and trucks to begin rolling over roads, bridges and culverts, officials want to be prepared, which is why an agreement is being readied to protect the county's infrastructure.
Conversations between the engineer's office and two drilling companies so far indicate wells will be drilled on property near the intersection of Warner Road and Warren Sharon Road in Vienna; on property along Ridge Ridge, also in Vienna; and ground on Hayes Orangeville Road in Hartford.
The talks have been with Consol Energy, based in Canonsburg, Pa., for the Warren Sharon Road property and with Carrizo Oil and Gas, out of Houston, for the other property in Vienna and on the land in Hartford.
It doesn't appear that permits have been issued, according to the Ohio Department of Natural Resources website.
But it was talks with the engineer's office, where it's been indicated drilling activity could commence sometime in the next month to six weeks, said Don Barzak, engineer's office director of governmental affairs and grants and special projects coordinator.
So today, county commissioners are expected to approve a model roadway use and maintenance agreement that can be used by the county and cities, villages and townships in the county to provide for repair and maintenance of infrastructure hurt by drilling activity.
''It's important we have an approved document in place to protect the infrastructure of the county,'' Barzak said.
There will be a meeting today for local officials to learn about the agreement, for which work began in January.
In part, it calls for operators to post a bond to cover the costs of damage caused activity related to drilling. Bond amounts would be announced today, however, Barzak noted that it would cost about $516,000 conservatively to build, from scratch, one mile of road.
Bond amounts will vary. Companies who agree beforehand to address infrastructure improvements, based on approved engineering, to accommodate for damage caused by drilling-related activity will have a lower bond. Those who don't, their bonds will be higher, Barzak said.
Engineer Randy Smith called the contracts ''boiler plate agreements'' that can be used by all the communities, but they are flexible enough to make sure individual community concerns are addressed in an appendix.
Barzak said the office also plans to take pictures and video of the roads before drilling activity for a log. ''We expect our road system to be left in the same shape it was then they found it,'' Barzak said.
Has anyone ever received compensaton from...
Wishqard LLC.
One of our neighbors in LeRoy has asked if anyone out there has ever received compensation from Wishgard LLC.
Although this comment was listed as a comment, I thought it important to make it a main post. Please comment on your experience with this company.
I am including a link to the company here: http://wishgard.com/home.html
One of our neighbors in LeRoy has asked if anyone out there has ever received compensation from Wishgard LLC.
Although this comment was listed as a comment, I thought it important to make it a main post. Please comment on your experience with this company.
I am including a link to the company here: http://wishgard.com/home.html
Fracking waste is no longer fresh water
Please note that millions of gallons of fresh water will be extracted from our streams, lakes and rivers to meet the millions of gallons of water demanded by the gas and drilling industry. This water will not be returned to our streams and lakes and rivers as it is too contaminated.
At a meeting in Jefferson sponsored by a Landowner's group, one of the attorneys present said "1 million gallons of water are being taken out of the Grand River now." Where will all this water come from as more wells are drilled?
Gail Larson, Trumbull Township
Forwarded message:
Tony and Jackie Evangelista
Subject: Fwd: Help Make Fracking Waste Regulated as Hazardous
Hello All, Having seen the film, Gasland, last evening, I am in a state of shock about how much damage fracking has already done in the US and about how this has all gone pretty much under the radar. I had no idea how far the practice has extended in the west, and now Ohio is threatened. There was an article on the front page of the PD today about an agreement that landowners in Trumbull County have made with BP to frack there. This has all gone under the radar because Dick Cheney got an exemption to the Clean Air Act put in a big energy bill passed in 2005. So these companies do not have to report all the many toxic chemicals which are in their fracking process. It appears that the regulatory function of the EPA has been compromised making this a vital Action Alert to respond to. Here's a link to an article just out about the situation in PA: http://truth-out.org/news/item/8021-about-that-dimock-fracking-study-results-did-show-methane-and-hazardous-chemicals. Please forward to like-minded friends.
Jackie
Dear Jacqueline,
As we saw with the New Year's Eve earthquake in Youngstown, Ohio, disposing of millions of gallons of out-of-town "fracking” waste is risky business.
Not only is the practice of fracking - horizontal hydraulic fracturing to reach deep-shale reserves of gas – risky, we must also worry about how the waste produced by this technique is handled.
With your help, the US EPA can have authority to regulate toxic oil and gas waste for what it is - hazardous waste.
The water pumped into the shale rock during fracking is full of chemicals – many of them toxic – and when that fluid comes back up, it still contains harmful chemicals and other nasty elements.
Please take action now. We must protect our health and our environment.
Recently, the Ohio Department of Natural Resources concluded that the series of 12 earthquakes in Youngstown last year were a result of a fracking waste-fluid injection well. As a result, Ohio regulators have announced a series of new controls on these high-pressure waste wells.
But the Ohio Environmental Council believes that the waste from oil and gas drilling should be disposed of using more protective methods. One important way to do that is for the EPA to regulate this waste as hazardous waste.
Sign our petition now urging Lisa Jackson, EPA Administrator, to end oil and gas exemptions from federal hazardous waste law.
Our health and communities can’t afford to wait. Please take action now using our easy form!
Sincerely,
http://www.theoec.org/
Keith Dimoff
Executive Director
P.S. Please make a $25 donation today to help the OEC continue our work to secure healthy air, land, and water for all who call Ohio home.
At a meeting in Jefferson sponsored by a Landowner's group, one of the attorneys present said "1 million gallons of water are being taken out of the Grand River now." Where will all this water come from as more wells are drilled?
Gail Larson, Trumbull Township
Forwarded message:
Tony and Jackie Evangelista
Subject: Fwd: Help Make Fracking Waste Regulated as Hazardous
Hello All, Having seen the film, Gasland, last evening, I am in a state of shock about how much damage fracking has already done in the US and about how this has all gone pretty much under the radar. I had no idea how far the practice has extended in the west, and now Ohio is threatened. There was an article on the front page of the PD today about an agreement that landowners in Trumbull County have made with BP to frack there. This has all gone under the radar because Dick Cheney got an exemption to the Clean Air Act put in a big energy bill passed in 2005. So these companies do not have to report all the many toxic chemicals which are in their fracking process. It appears that the regulatory function of the EPA has been compromised making this a vital Action Alert to respond to. Here's a link to an article just out about the situation in PA: http://truth-out.org/news/item/8021-about-that-dimock-fracking-study-results-did-show-methane-and-hazardous-chemicals. Please forward to like-minded friends.
Jackie
Dear Jacqueline,
As we saw with the New Year's Eve earthquake in Youngstown, Ohio, disposing of millions of gallons of out-of-town "fracking” waste is risky business.
Not only is the practice of fracking - horizontal hydraulic fracturing to reach deep-shale reserves of gas – risky, we must also worry about how the waste produced by this technique is handled.
With your help, the US EPA can have authority to regulate toxic oil and gas waste for what it is - hazardous waste.
The water pumped into the shale rock during fracking is full of chemicals – many of them toxic – and when that fluid comes back up, it still contains harmful chemicals and other nasty elements.
Please take action now. We must protect our health and our environment.
Recently, the Ohio Department of Natural Resources concluded that the series of 12 earthquakes in Youngstown last year were a result of a fracking waste-fluid injection well. As a result, Ohio regulators have announced a series of new controls on these high-pressure waste wells.
But the Ohio Environmental Council believes that the waste from oil and gas drilling should be disposed of using more protective methods. One important way to do that is for the EPA to regulate this waste as hazardous waste.
Sign our petition now urging Lisa Jackson, EPA Administrator, to end oil and gas exemptions from federal hazardous waste law.
Our health and communities can’t afford to wait. Please take action now using our easy form!
Sincerely,
http://www.theoec.org/
Keith Dimoff
Executive Director
P.S. Please make a $25 donation today to help the OEC continue our work to secure healthy air, land, and water for all who call Ohio home.
Wednesday, March 28, 2012
State issues more horizontal well permits for Youngstown region
Wednesday, March 28, 2012
Print
YOUNGSTOWN, Ohio – Seventeen new horizontal well permits were issued by the
Ohio Department of Natural Resources the week of March 18 to drill natural gas
wells in the Utica/Point Pleasant shale plays throughout the state including
four wells in Columbiana County and two in Carroll County.
ODNR issued the four permits in Columbiana to Chesapeake Exploration LLC, a subsidiary of Chesapeake Energy, to drill two wells in Hanover Township on the Hanover Farms property, one well on the Morris property in Elkrun Township, and another in Madison Township on the Kernich property.
These are the first horizontal wells permitted on each of the three properties. However, ODNR records show Chesapeake applied to drill a new well on the Kernich property on Jan. 23 and has yet to apply for a complementary horizontal well permit. Chesapeake applied March 13 for approved new well and horizontal permits on the Kernich property.
Horizontal well permits in Columbiana County number 26: seven in Hanover Township, two in Elkrun and two in Madison.
In Carroll County, Chesapeake’s approved permits reached 60 with a new horizontal well permit on the Mangun property in Augusta Township and a new horizontal well permit on the P. Brown property in Lee Township.
Chesapeake holds nine horizontal drilling permits in Augusta, three of them on the Mangun property, and 16 horizontal drilling permits in Lee, two on the P. Brown property. ODNR records show no pending permits on either of the Mangun or Brown properties.
The ODNR also issued horizontal drilling permits for Chesapeake in Harrison County (two), Stark County (two) and Jefferson County.
The ODNR issued HG Energy three horizontal drilling permits on the Whitacre Enterprises property in Washington Township of Monroe County.
Enervest Operating LLC was issued two horizontal drilling permits by the ODNR, one in Stark County and another to drill in Muskingum County.
Another permit was also issued in Belmont County to Hess Ohio Resources.
A review of ODNR records show no new horizontal drilling permits were issued in Mahoning or Trumbull counties nor are there any permits pending.
Copyright 2012 The Business Journal, Youngstown, Ohio.
ODNR issued the four permits in Columbiana to Chesapeake Exploration LLC, a subsidiary of Chesapeake Energy, to drill two wells in Hanover Township on the Hanover Farms property, one well on the Morris property in Elkrun Township, and another in Madison Township on the Kernich property.
These are the first horizontal wells permitted on each of the three properties. However, ODNR records show Chesapeake applied to drill a new well on the Kernich property on Jan. 23 and has yet to apply for a complementary horizontal well permit. Chesapeake applied March 13 for approved new well and horizontal permits on the Kernich property.
Horizontal well permits in Columbiana County number 26: seven in Hanover Township, two in Elkrun and two in Madison.
In Carroll County, Chesapeake’s approved permits reached 60 with a new horizontal well permit on the Mangun property in Augusta Township and a new horizontal well permit on the P. Brown property in Lee Township.
Chesapeake holds nine horizontal drilling permits in Augusta, three of them on the Mangun property, and 16 horizontal drilling permits in Lee, two on the P. Brown property. ODNR records show no pending permits on either of the Mangun or Brown properties.
The ODNR also issued horizontal drilling permits for Chesapeake in Harrison County (two), Stark County (two) and Jefferson County.
The ODNR issued HG Energy three horizontal drilling permits on the Whitacre Enterprises property in Washington Township of Monroe County.
Enervest Operating LLC was issued two horizontal drilling permits by the ODNR, one in Stark County and another to drill in Muskingum County.
Another permit was also issued in Belmont County to Hess Ohio Resources.
A review of ODNR records show no new horizontal drilling permits were issued in Mahoning or Trumbull counties nor are there any permits pending.
Copyright 2012 The Business Journal, Youngstown, Ohio.
Influx of cash could boost area economy
March 28, 2012
,
Tribune Chronicle |
TribToday.com
WARREN - From paying off childrens' college costs to boosting the area's
attractiveness to retailers and creating a market for natural gas-powered
vehicles, the potential signing of gas drilling leases is raising spirits across
Trumbull County.
"It's a once-in-a-lifetime event to get this kind of money. It'll be tremendous for truck and car sales, furniture, electronics," said a county business owner who asked not to be identified because he also owns some of the 85,000 acres in Trumbull County being leased by BP North America Natural Gas if final papers are signed.
The owner said the bonus money, plus expected increase in business sales, will come in handy for something not as glamorous as a new vehicle or big-screen TV.
"I'll use it to pay the college school bills for the kids," the owner said.
Members of the Associated Landowners of the Ohio Valley Monday night overwhelmingly approved terms with BP that call for an upfront bonus payment of $3,900 per acre, plus royalties of 17.5 percent on the gas and oil from wells.
The deal, which awaits the signing of final papers, perhaps by the end of April, would produce $331 million-plus for landowners, although a variety of taxes are expected to take 40 percent or more of any lump-sum payments. The money is expected to be paid in October.
"Most prudent people aren't pulling the trigger until they have the money. They're waiting to see if the deal is done," the owner said.
Area business officials said the deal may open the door to more investment in Trumbull County.
"We know Chesapeake (Energy) is putting an inline processing plant in Columbiana. One might suspect another might ne needed in Trumbull County or southern Ashtabula County," Regional Chamber President Thomas Humphries said.
Chesapeake has announced it will invest $900 million for a gas separation plant near Hanoverton and another in Harrison County, along with a pipeline to carry the gas.
Significant investments by Chesapeake and BP also may encourage other energy giants to follow suit.
"There are others sitting on the sideline. Is Shell going to be in that play?" Humphries said.
The area's largest retail business developer, The Cafaro Co., can use BP's investment to attract other retailers, restaurants and other businesses, a spokesman said.
"One thing our real estate development team does when trying to attract retailers is highlight the area's economic vitality and disposable income. The continuing good news absolutely is the kind of news that's welcomed," Joe Bell said.
Cafaro is moving ahead with an extended-stay hotel and banquet center attached to its Eastwood Mall in Niles. Bell said the project was considered before the shale gas boom began, but he said the new economic activity helps.
"We've seen it happen in other parts of Ohio and western Pennsylvania, where rental properties, residential housing and hotels are finding their rooms full. We believe the same pattern will repeat in the Mahoning Valley," he said.
The mushrooming supply of natural gas is causing energy companies to seek new customers. The auto industry looms as a major user of natural gas, a local auto dealer spokesman said.
Steve Bott, sales manager for Mark Thomas Ford in Cortland, said he attended a meeting of Ford Motor Co. and Chesapeake officials March 21 in Pittsburgh, where making natural gas-powered vehicles as a topic.
"Ford has the ability to convert certain vehicles for $6,000 to run on compressed natural gas," Bott said, adding the gas costs about $1.69 compared to $3.90 for a gallon of regular gasoline. "Over a four-year time frame, it pays for itself.
"They say this could go on for 50 years," Bott continued. "Kids could learn to be machinists, whatever is needed. It's something to keep our kids in our community."
"It's a once-in-a-lifetime event to get this kind of money. It'll be tremendous for truck and car sales, furniture, electronics," said a county business owner who asked not to be identified because he also owns some of the 85,000 acres in Trumbull County being leased by BP North America Natural Gas if final papers are signed.
The owner said the bonus money, plus expected increase in business sales, will come in handy for something not as glamorous as a new vehicle or big-screen TV.
"I'll use it to pay the college school bills for the kids," the owner said.
Members of the Associated Landowners of the Ohio Valley Monday night overwhelmingly approved terms with BP that call for an upfront bonus payment of $3,900 per acre, plus royalties of 17.5 percent on the gas and oil from wells.
The deal, which awaits the signing of final papers, perhaps by the end of April, would produce $331 million-plus for landowners, although a variety of taxes are expected to take 40 percent or more of any lump-sum payments. The money is expected to be paid in October.
"Most prudent people aren't pulling the trigger until they have the money. They're waiting to see if the deal is done," the owner said.
Area business officials said the deal may open the door to more investment in Trumbull County.
"We know Chesapeake (Energy) is putting an inline processing plant in Columbiana. One might suspect another might ne needed in Trumbull County or southern Ashtabula County," Regional Chamber President Thomas Humphries said.
Chesapeake has announced it will invest $900 million for a gas separation plant near Hanoverton and another in Harrison County, along with a pipeline to carry the gas.
Significant investments by Chesapeake and BP also may encourage other energy giants to follow suit.
"There are others sitting on the sideline. Is Shell going to be in that play?" Humphries said.
The area's largest retail business developer, The Cafaro Co., can use BP's investment to attract other retailers, restaurants and other businesses, a spokesman said.
"One thing our real estate development team does when trying to attract retailers is highlight the area's economic vitality and disposable income. The continuing good news absolutely is the kind of news that's welcomed," Joe Bell said.
Cafaro is moving ahead with an extended-stay hotel and banquet center attached to its Eastwood Mall in Niles. Bell said the project was considered before the shale gas boom began, but he said the new economic activity helps.
"We've seen it happen in other parts of Ohio and western Pennsylvania, where rental properties, residential housing and hotels are finding their rooms full. We believe the same pattern will repeat in the Mahoning Valley," he said.
The mushrooming supply of natural gas is causing energy companies to seek new customers. The auto industry looms as a major user of natural gas, a local auto dealer spokesman said.
Steve Bott, sales manager for Mark Thomas Ford in Cortland, said he attended a meeting of Ford Motor Co. and Chesapeake officials March 21 in Pittsburgh, where making natural gas-powered vehicles as a topic.
"Ford has the ability to convert certain vehicles for $6,000 to run on compressed natural gas," Bott said, adding the gas costs about $1.69 compared to $3.90 for a gallon of regular gasoline. "Over a four-year time frame, it pays for itself.
"They say this could go on for 50 years," Bott continued. "Kids could learn to be machinists, whatever is needed. It's something to keep our kids in our community."
Tuesday, March 27, 2012
BP Trumbull leases may total $331M
By Karl Henkel
khenkel@vindy.com
YOUNGSTOWN
More than 1,000 Trumbull County landowners voted in favor of the state’s largest single-county oil and gas lease Monday night, which, if executed, will pump more than $331 million into the local economy.
The deal is not with Oklahoma City-based Chesapeake Energy Corp., but rather London-based BP, according to landowners who attended the meeting.
BP is expected to announce the deal today.
A bonus payment figure, which was not available to landowners before Monday’s meeting, totaled $3,900 per acre, according to those who attended the meeting.
Landowners, under terms of the lease, are slated to receive royalties of 17.5 percent of mineral values.
Some landowners approached by The Vindicator requested anonymity when discussing the lease because of confidentiality concerns.
The meeting was by invitation only.
One landowner, however, who voted in favor of the lease and who owns 80 acres in Kinsman, said he was glad the Associated Landowners of the Ohio Valley, a nonprofit landowner-advocacy group that negotiated on behalf of the landowners, chose a “legitimate outfit” and negotiated “reasonable pay.”
Landowners were previously told they would receive at least $2,250 per acre.
ALOV would not identify of the “major international company,” citing the fact landowners had voted on the lease, but had not yet signed.
ALOV also declined to verify terms of the lease, citing a confidentiality agreement.
The lease signing will take place next month.
The landowners pooled about 85,000 acres, the largest single-county pool of leased land in state history — “monumentally sized” — said Bob Rea, president of ALOV.
At the session, each acre was worth one vote.
There were 67,103 represented acres at the meeting; 63,723 voted in favor and 345 represented acres voted against the lease proposal. The remaining represented acreage abstained from voting. Abstentions from voting on lease deals can occur when there is potential disagreement regarding previous mineral-rights leases.
Though 95 percent of those represented acres voted in favor of the lease, coming to an agreement was not an easy task.
ALOV and energy companies have negotiated for about six months, Rea said.
“We could have settled in September,” he told The Vindicator. “We had lookers, and we had people that were interested in certain levels, but it was not with the language of our lease that we wanted to continue to honor.”
Rea said previous proposals were “priced below market value.”
Though the group approved the lease terms, Rea said, the lease will not be signed until next month.
Once the lease is signed, landowners could receive their bonus checks within about six months, thanks in part because they pooled together funds to digitize Trumbull County records, thus expediting the process.
“It cost more than $250,000, but our people are going to be paid quicker,” said Rea, who did not say exactly how quickly landowners will receive bonus checks.
ALOV has now helped Ohio landowners lease more than 250,000 acres to oil and gas companies.
khenkel@vindy.com
YOUNGSTOWN
More than 1,000 Trumbull County landowners voted in favor of the state’s largest single-county oil and gas lease Monday night, which, if executed, will pump more than $331 million into the local economy.
The deal is not with Oklahoma City-based Chesapeake Energy Corp., but rather London-based BP, according to landowners who attended the meeting.
BP is expected to announce the deal today.
A bonus payment figure, which was not available to landowners before Monday’s meeting, totaled $3,900 per acre, according to those who attended the meeting.
Landowners, under terms of the lease, are slated to receive royalties of 17.5 percent of mineral values.
Some landowners approached by The Vindicator requested anonymity when discussing the lease because of confidentiality concerns.
The meeting was by invitation only.
One landowner, however, who voted in favor of the lease and who owns 80 acres in Kinsman, said he was glad the Associated Landowners of the Ohio Valley, a nonprofit landowner-advocacy group that negotiated on behalf of the landowners, chose a “legitimate outfit” and negotiated “reasonable pay.”
Landowners were previously told they would receive at least $2,250 per acre.
ALOV would not identify of the “major international company,” citing the fact landowners had voted on the lease, but had not yet signed.
ALOV also declined to verify terms of the lease, citing a confidentiality agreement.
The lease signing will take place next month.
The landowners pooled about 85,000 acres, the largest single-county pool of leased land in state history — “monumentally sized” — said Bob Rea, president of ALOV.
At the session, each acre was worth one vote.
There were 67,103 represented acres at the meeting; 63,723 voted in favor and 345 represented acres voted against the lease proposal. The remaining represented acreage abstained from voting. Abstentions from voting on lease deals can occur when there is potential disagreement regarding previous mineral-rights leases.
Though 95 percent of those represented acres voted in favor of the lease, coming to an agreement was not an easy task.
ALOV and energy companies have negotiated for about six months, Rea said.
“We could have settled in September,” he told The Vindicator. “We had lookers, and we had people that were interested in certain levels, but it was not with the language of our lease that we wanted to continue to honor.”
Rea said previous proposals were “priced below market value.”
Though the group approved the lease terms, Rea said, the lease will not be signed until next month.
Once the lease is signed, landowners could receive their bonus checks within about six months, thanks in part because they pooled together funds to digitize Trumbull County records, thus expediting the process.
“It cost more than $250,000, but our people are going to be paid quicker,” said Rea, who did not say exactly how quickly landowners will receive bonus checks.
ALOV has now helped Ohio landowners lease more than 250,000 acres to oil and gas companies.
Even with higher taxes, drillers still will drill
Leases will expire unless production begins
By DAN SHINGLER
4:30 am, March 27, 2012
4:30 am, March 27, 2012
The leases that thousands of Ohio landowners have signed with oil and gas companies will drive the development of thousands of shale gas wells in the eastern half of the state during the next five years, even if the state proceeds with raising its taxes on the energy industry, according to experts on minerals rights.
There's no escape clause for an energy company to say that it needs more time to develop a property because of a change in Ohio's tax code. And a change appears likely, as a 10-point energy policy Gov. John Kasich unveiled two weeks ago calls for raising the state's tax on oil and gas producers in order to pay for a reduction in personal income tax rates.
The governor, and others, say Ohio taxes the oil and gas business less than other states and should adjust its rates upward. The energy industry has complained that any increase in taxes would raise the risk that drilling would slow in Ohio. But industry observers are not convinced.
“For better or worse, the companies have created a contractual obligation to drill,” said Andrew Thomas, a geologist and former oil and gas attorney in New Orleans who now serves as executive in residence at Cleveland State University.
Dr. Thomas was one of the lead authors of a Feb. 28 study done on behalf of the Ohio Shale Coalition by researchers at CSU's Levin College of Urban Affairs, Marietta College and Ohio State University. The study outlined the status and likely future development of Ohio's shale gas industry, including the economic benefits it will provide to the state. Dr. Thomas predicts that Ohio will see a total of about 2,000 wells drilled between now and the end of 2014. By then, well development should be on pace to create 1,000 more new wells per year.
“I think, after that, it will sustain that level of activity for 20 years,” said Dr. Thomas, who based his prediction on estimates of how much gas and oil lies trapped in Ohio's deep Utica shale deposits, about 8,000 feet below ground.
Doling out big dollars
Since each well costs as much as $6 million to drill, Dr. Thomas and his fellow researchers are predicting an annual investment in Ohio by energy companies of as much as $6 billion a year by 2014. That figure is just for the drilling work itself and does not include investments in pipelines, processing facilities, water treatment installations and many other tangential aspects of what is becoming Ohio's most famous industry.
It's a big number, but it isn't as big as those the drillers themselves have thrown around.
Last August, Chesapeake Energy Corp. CEO Aubrey McLendon, whose company has spent about $2.2 billon on shale gas leases in Ohio, predicted his company and others like it will invest an estimated $20 billion a year in Ohio's shale gas and oil industry for the next decade.
The ultimate driver of all this activity is the money to be made by extracting valuable natural gas and oil once believed to be trapped underground forever. The natural resources drillers seek are simply too valuable to be left alone, say both drillers and industry observers such as Dr. Thomas.
But the lease clauses are going to add significantly to the urgency drillers feel to produce, Dr. Thomas said, because if they don't, it will cost them plenty.
"A difficult dilemma'
Brad Hillyer, a lawyer in Uhrichs-ville at the law firm Connolly, Hill-yer, Lindsay & Ong, estimates he's worked on 2,500 shale gas leases in the last three years. Some leases require drillers to start production three years after the lease is signed, but five years is pretty much the industry standard in most Ohio leases, Mr. Hillyer said.
The leases also have automatic renewal clauses, Mr. Hillyer said, which means an energy company can keep a lease but must pay for it all over again once it expires.
Attorney Matt Warnock, who works on oil and gas leases for the law firm Bricker & Eckler in Columbus, said lease renewal payments can be as little as 60% of the initial bonus paid to secure a lease, or can be more than original amount.
“We try to get as much as we can, so we usually push for the 115%,” Mr. Warnock said of his work on behalf of landowners.
As a result of those potential costs, lawyers say, even if the state raises the taxes it collects on the production of Ohio's gas and oil, the energy companies still will need to drill if they want to keep their leases and avoid paying for them all over again.
“It does put them in a difficult dilemma,” said David Hudson, a minerals rights attorney in the Toledo office of the Reminger Co. law firm. He now spends much of his time in the eastern half of the state's shale gas territory.
“These oil companies have spent billions of dollars on bonuses for these leases,” Dr. Thomas said. “If they want to maximize that, they need to get moving. ... They've got three years to develop a lot of acreage.”
Too big a bite?
Energy companies have not addressed publicly whether they'll pay bonuses all over again to keep their rights in place if the state increases taxes on their production. The Ohio Oil and Gas Association did not respond to requests for comment by phone and email to discuss the matter.
Mr. Hudson predicted that drillers might respond to the situation by performing a sort of hydrocarbon triage, where they select what they think will be the most profitable drilling sites for exploration while leaving others to sit so their leases either can be renewed or abandoned later.
They even might try to hold acreage by putting tiny, shallow wells in place, which would yield just a fraction of what a deep horizontal fracking well would produce. However, it isn't known how the courts would view such a “tricky” act, Mr. Hudson said.
Mr. Hillyer, the attorney in Uhrichsville, said he supports an increase in Ohio's oil and gas tax — known as the severance tax — because he believes it won't slow down development and could provide needed funds for Ohio's small towns. Many of those towns have seen deep cuts in the money they receive from the state, he said, and now they are worried about added infrastructure expenses due to oil and gas activity.
“They want (the governor) to increase the severance tax, but not reduce the income tax” and instead restore some of their lost state support, Mr. Hillyer said.
Regardless of what happens with taxes or how much drillers hurry, they probably won't be able to meet the requirements of all their leases, said Cleveland State's Dr. Thomas. There simply won't be enough time for them to drill wells on each of the thousands of properties they hold before the leases for those lands are more than five years old.
Others agree.
“They may have bitten off more than they can chew,” Mr. Hudson said.
Added Mr. Hillyer: “There probably aren't enough drilling rigs on the planet to drill all the wells they need to drill.”
Valuable Information on the Windsor meeting
Good afternoon neighbors,
I attended the Windsor meeting last night that Mardy Townsend organized. There were at least 150 people in attendance, mostly from the Windsor area. They have 4 injection wells in their township, just north of Windsor on 86. There is grave concern by the neighbors about the pollutants being injected into these wells. Many close by to the wells are farmers. The Windsor Trustees were there as well as a County Prosecutor Sartini, County Commissioner Carlo and John Patterson, candidate for State Representative.
The Farmer's Union was a sponsor last night. They will work with us if we want to get Joe Logan, member of the Ohio EPA Council and a landowner, to put on his presentation. He had a power point presentation that was very informative and he is very knowledgeable about what the fracking entails (water use, chemicals that can pollute our aquifers and air, etc). He is also very involved in Columbus trying to get stricter regulations on these processes.
Anyway, I would be happy to make contact with the Farmer's Union if we want to pursue a similar meeting in Trumbull Township.
I am going to the NE Landowner's meeting in Jefferson tonight to see if there is anything Jim and I can do to protect our property when/if we are swallowed up in a mandatory pool. It would also be a plus if, somehow, we can start collecting information about any leases our neighbors have signed---not to attack or demean or be negative---but to know what leases are already out there that may affect our property.
See you soon,
Gail
I attended the Windsor meeting last night that Mardy Townsend organized. There were at least 150 people in attendance, mostly from the Windsor area. They have 4 injection wells in their township, just north of Windsor on 86. There is grave concern by the neighbors about the pollutants being injected into these wells. Many close by to the wells are farmers. The Windsor Trustees were there as well as a County Prosecutor Sartini, County Commissioner Carlo and John Patterson, candidate for State Representative.
The Farmer's Union was a sponsor last night. They will work with us if we want to get Joe Logan, member of the Ohio EPA Council and a landowner, to put on his presentation. He had a power point presentation that was very informative and he is very knowledgeable about what the fracking entails (water use, chemicals that can pollute our aquifers and air, etc). He is also very involved in Columbus trying to get stricter regulations on these processes.
Anyway, I would be happy to make contact with the Farmer's Union if we want to pursue a similar meeting in Trumbull Township.
I am going to the NE Landowner's meeting in Jefferson tonight to see if there is anything Jim and I can do to protect our property when/if we are swallowed up in a mandatory pool. It would also be a plus if, somehow, we can start collecting information about any leases our neighbors have signed---not to attack or demean or be negative---but to know what leases are already out there that may affect our property.
See you soon,
Gail
Our Chardon neighbors rally to protect us all on Saturday
Dear Ashtabula neighbors:
After the meeting at Windsor last night and the wonderful presentation on the dangers of fracking that Joe Logan, Ohio EPA gave a large group, it is even more important now that we show our support for our Geauga neighbors who are fighting to be heard by their local public officials. Please plan on attending on Saturday if you can.
Thank you, Gail Larson
CHARDON RALLY ANTI-FRACKING
Saturday, March 31st from 12:30 - 2:30
at ChardonSquare
Help protect our water, air, roadsand property values! Help us get theattention of our public officials.
Please join us as we march toprotect Geauga County which is slated for 300 fracking wells .
Meet at the Fire Station parking lot( 110 Hambden St ) for the march , followed by speakers by the gazebo ..
After the meeting at Windsor last night and the wonderful presentation on the dangers of fracking that Joe Logan, Ohio EPA gave a large group, it is even more important now that we show our support for our Geauga neighbors who are fighting to be heard by their local public officials. Please plan on attending on Saturday if you can.
Thank you, Gail Larson
CHARDON RALLY ANTI-FRACKING
Saturday, March 31st from 12:30 - 2:30
at ChardonSquare
Help protect our water, air, roadsand property values! Help us get theattention of our public officials.
Please join us as we march toprotect Geauga County which is slated for 300 fracking wells .
Meet at the Fire Station parking lot( 110 Hambden St ) for the march , followed by speakers by the gazebo ..
Monday, March 19, 2012
March 31, 2012 No Frack Rally in Geauga County Information
Hello, Ashtabula County Neighbors:
Here is a flyer for you to download that will give you information about the upcoming "No Frack" Rally in Geauga on March 31st. If you can make it, our Geauga County neighbors will have increased numbers to show public officials we are concerned about protecting our property for our families and our neighbors. Even if you have accepted the gas drilling arrival in our communities, if you go to a rally of this type, it does show our support.
Per Jessica Schaner, one of the event organizers, "We just need to get as many people there as possible to help make our statement!
Thats where you come in--if everyone can print out a few flyers and post them where you go everyday (most banks, stores, taverns, ect. have a bulletin board or will gladly tape it in their window) or email to that friend who cares about fracking but isn't on this list--this event will make our elected officials take notice!"
Thank you for being interested,
Gail Larson, Trumbull Township
Here is a flyer for you to download that will give you information about the upcoming "No Frack" Rally in Geauga on March 31st. If you can make it, our Geauga County neighbors will have increased numbers to show public officials we are concerned about protecting our property for our families and our neighbors. Even if you have accepted the gas drilling arrival in our communities, if you go to a rally of this type, it does show our support.
Per Jessica Schaner, one of the event organizers, "We just need to get as many people there as possible to help make our statement!
Thats where you come in--if everyone can print out a few flyers and post them where you go everyday (most banks, stores, taverns, ect. have a bulletin board or will gladly tape it in their window) or email to that friend who cares about fracking but isn't on this list--this event will make our elected officials take notice!"
Thank you for being interested,
Gail Larson, Trumbull Township
Thursday, March 15, 2012
Boom inches north
Company might drill first Trumbull County well
March 15, 2012
,
Tribune Chronicle |
TribToday.com
VIENNA - A Houston energy company is poised to bring the Warren area into the
shale natural gas boom by drilling its first well around mid-summer.
Carrizo Oil and Gas Inc.'s first horizontal well could be in Trumbull County, or across the Pennsylvania border in Mercer County, company Vice President of Investor Relations Richard Hunter said Wednesday.
Along with its financial partner, Avista Capital Partners, the company holds leases on about 16,600 acres in southeastern Trumbull County and southwestern Mercer County, according to the company's investor presentation to the Independent Petroleum Association of America in Palm Beach, Fla.
Hunter said he couldn't break out the Trumbull County acreage, but the presentation suggests the county has a slight edge over Mercer.
"We have enough to get started. If the well is encouraging, we'd be interested in adding to the acreage," he said.
Carrizo is applying for permits with state regulators to begin drilling, Hunter said.
"We'd like to start drilling, or have the well site selection completed, by the middle of the year," he said.
The exact locations of the permits are unknown, although Hunter said the company considers access to water, the lay of the land, access to roads and proximity to population.
It's unclear if the company will seek more land leases until after the first well can be evaluated.
"The studies are all encouraging, but we won't know until we drill a well and watch it produce," he said.
With a roughly $1 billion market capitalization on the Nasdaq stock exchange under symbol CRZO, Hunter called the company "peanuts" compared to Chesapeake Energy and Shell Oil, two giants who are working in the Utica and Marcellus shale fields of eastern Ohio, western Pennsylvania and neighboring states.
"What we have an abundance of is experience in drilling these kinds of wells. For our size, we're well above and beyond any similar-sized company in drilling (horizontal) wells. That's all we've done since 2005," he said.
Carrizo Oil and Gas Inc.'s first horizontal well could be in Trumbull County, or across the Pennsylvania border in Mercer County, company Vice President of Investor Relations Richard Hunter said Wednesday.
Along with its financial partner, Avista Capital Partners, the company holds leases on about 16,600 acres in southeastern Trumbull County and southwestern Mercer County, according to the company's investor presentation to the Independent Petroleum Association of America in Palm Beach, Fla.
Hunter said he couldn't break out the Trumbull County acreage, but the presentation suggests the county has a slight edge over Mercer.
"We have enough to get started. If the well is encouraging, we'd be interested in adding to the acreage," he said.
Carrizo is applying for permits with state regulators to begin drilling, Hunter said.
"We'd like to start drilling, or have the well site selection completed, by the middle of the year," he said.
The exact locations of the permits are unknown, although Hunter said the company considers access to water, the lay of the land, access to roads and proximity to population.
It's unclear if the company will seek more land leases until after the first well can be evaluated.
"The studies are all encouraging, but we won't know until we drill a well and watch it produce," he said.
With a roughly $1 billion market capitalization on the Nasdaq stock exchange under symbol CRZO, Hunter called the company "peanuts" compared to Chesapeake Energy and Shell Oil, two giants who are working in the Utica and Marcellus shale fields of eastern Ohio, western Pennsylvania and neighboring states.
"What we have an abundance of is experience in drilling these kinds of wells. For our size, we're well above and beyond any similar-sized company in drilling (horizontal) wells. That's all we've done since 2005," he said.
Gas Processing Plants Position Mahoning Valley for Industry Supply Chain
Thursday, March 15, 2012
YOUNGSTOWN, Ohio -- When Exterran Energy Solutions begins operations next
year at the Salt Springs Road Industrial Park, the Houston-based company will
build machines for the $900 million two-plant gas processing complex to be built
in Columbiana and Harrison counties by Chesapeake Energy Corp. and its
partners.
“One of the companies constructing a large factory in Ohio is Exterran, which will build compressors and some processing equipment for us,” says George Passela, executive vice president and chief financial officer for M3 Midstream LLC, also based in Houston. M3, which does business as Momentum, is one of the partners in Chesapeake’s project touted as the largest midstream service complex in Eastern Ohio.
The link between Exterran’s expansion here and the $900 million dollar project is more affirmation (think of the thousands of miles of pipe V&M Star produces) of what Eric Planey of the Youngstown/Warren Regional Chamber promotes as the Mahoning Valley’s ideal location to become “the hub of the Utica shale supply chain.”
A spokesman for Weatherford International, a Swiss oilfield services company that operates in 50 countries, confirmed Tuesday to The Business Journal that company executives are scouting “several sites” in the Youngstown area to locate a facility. Weatherford provides services to drillers at well sites.
“You are fortunate to have an extremely valuable natural resource in your state,” says Passela. “It has enormous potential to affect the entire economy of Ohio.”
Numerous subcontractors will be involved in Chesapeake's project, he begins. “There will be a construction company that does the actual installation of the pipelines. There are several pipelines to make this project work, carrying both gas and natural gas liquids [to and from the Columbiana and Harrison County plants], and then there will be fabricators who build the very vessels that comprise a natural gas processing and fractionation plant.”
As many as 2,000 construction jobs could result, along with 200 permanent, top-paying jobs once the processing plants are operating, according to Passela.
Exterran broke ground Feb. 28 for its $13.2 million, 65,000-square-foot plant where it will employ 103 workers to manufacture separators, dehydrators and other equipment used to treat and process natural gas and oil. The plant, expected to be turning out product during the first quarter of 2013, will employ 103 workers. That timetable coincides with the second-quarter 2013 start-up of the gas processing plant in Kensington -- a tiny town just a stone’s throw from the Columbiana/Carroll County border -- and the fractionation plant in Harrison County.
A graphic on the M3 website depicts where the two plants will be located and the pipelines that will connect them.
Passela says negotiations are under way with landowners in Hanover Township and some purchase options have been secured. But given his company’s role in the massive project – designing and building the plants – he’s careful not to “get ahead of ourselves and presume anything. We have a process to go through with the various regulatory agencies, and we’ll do that step-by-step,” he says.
Chesapeake Energy announced Tuesday that its wholly owned subsidiary, Chesapeake Midstream Development LP, it is joining with M3 Midstream and EV Energy Partners LP, also based in Houston, to build, operate and supply the processing plants.
Five hours earlier, a press event in the village of Cadiz hailed the $1 billion investment that MarkWest Energy Partners of Denver will make to build two gas processing plants and one fractionation plant in Harrison and Noble counties. Like the Chesapeake project, the MarkWest plants will be linked by an extensive network of pipelines, connecting what’s taken out of the ground in eastern Ohio’s Utica shale with the processors who enable the dry gas and wet gas -- butane, propane and ethane -- to go to market.
“The first step in processing gas rich in liquids is the reverse of refining,” Passela explains. “In refineries, you heat up crude oil and as it boils off, you get different products. In natural gas, in order to extract liquids, you reduce the temperature to varying degrees below zero, and as you do that, the liquids condense and they drop out of the gas stream.”
Thus the wet gas is separated from the dry gas at a cryogenic processing plant, the industry term for the facility to be built in Kensington.
The next step is fractionation, which will occur at the Harrison County plant. The term is derived from the fractions of different liquid gases that need to be further separated. “You have to pass that raw mix through a fractionator,” Passela continues.
The eastern Ohio processing facilities to be built by Chesapeake and its partners will compete with the processing facilities to be built by MarkWest in eastern Ohio, although in other shale plays where MarkWest already operates such plants, Chesapeake is one of its customers.
"Companies like Chesapeake, Range Resources, Anadarko, Gulfport, Conoco, BP -- these are our customers," says the CEO of MarkWest, Frank Semple. "These are the ones that do the drilling. We take it from there."
MarkWest has a deal with Gulfport Energy to process its gas at the Harrison County plant, which also is expected to begin operations in the second quarter of 2013.
“We have gas and acreage dedicated to our system from three companies, who also happen to be joint venture partners,” Passela notes. “MarkWest has acreage and gas dedicated from one company.”
The Chesapeake and MarkWest processing plants each will have the capacity to process 200 million cubic feet of gas per day; Chesapeake’s fractionator will separate 600 million cubic feet of wet gas per day. MarkWest has not said where it will build its eastern Ohio fractionator.
During the first phase of Chesapeake's midstream services project, most of the $900 million investment will be made. But there could be substantial second phase, when more capacity is added to both plants, Passela says. “That’s to be determined. It depends on how the drilling progresses and how much additional volume has to be gathered and processed.”
“One of the companies constructing a large factory in Ohio is Exterran, which will build compressors and some processing equipment for us,” says George Passela, executive vice president and chief financial officer for M3 Midstream LLC, also based in Houston. M3, which does business as Momentum, is one of the partners in Chesapeake’s project touted as the largest midstream service complex in Eastern Ohio.
The link between Exterran’s expansion here and the $900 million dollar project is more affirmation (think of the thousands of miles of pipe V&M Star produces) of what Eric Planey of the Youngstown/Warren Regional Chamber promotes as the Mahoning Valley’s ideal location to become “the hub of the Utica shale supply chain.”
A spokesman for Weatherford International, a Swiss oilfield services company that operates in 50 countries, confirmed Tuesday to The Business Journal that company executives are scouting “several sites” in the Youngstown area to locate a facility. Weatherford provides services to drillers at well sites.
“You are fortunate to have an extremely valuable natural resource in your state,” says Passela. “It has enormous potential to affect the entire economy of Ohio.”
Numerous subcontractors will be involved in Chesapeake's project, he begins. “There will be a construction company that does the actual installation of the pipelines. There are several pipelines to make this project work, carrying both gas and natural gas liquids [to and from the Columbiana and Harrison County plants], and then there will be fabricators who build the very vessels that comprise a natural gas processing and fractionation plant.”
As many as 2,000 construction jobs could result, along with 200 permanent, top-paying jobs once the processing plants are operating, according to Passela.
Exterran broke ground Feb. 28 for its $13.2 million, 65,000-square-foot plant where it will employ 103 workers to manufacture separators, dehydrators and other equipment used to treat and process natural gas and oil. The plant, expected to be turning out product during the first quarter of 2013, will employ 103 workers. That timetable coincides with the second-quarter 2013 start-up of the gas processing plant in Kensington -- a tiny town just a stone’s throw from the Columbiana/Carroll County border -- and the fractionation plant in Harrison County.
A graphic on the M3 website depicts where the two plants will be located and the pipelines that will connect them.
Passela says negotiations are under way with landowners in Hanover Township and some purchase options have been secured. But given his company’s role in the massive project – designing and building the plants – he’s careful not to “get ahead of ourselves and presume anything. We have a process to go through with the various regulatory agencies, and we’ll do that step-by-step,” he says.
Chesapeake Energy announced Tuesday that its wholly owned subsidiary, Chesapeake Midstream Development LP, it is joining with M3 Midstream and EV Energy Partners LP, also based in Houston, to build, operate and supply the processing plants.
Five hours earlier, a press event in the village of Cadiz hailed the $1 billion investment that MarkWest Energy Partners of Denver will make to build two gas processing plants and one fractionation plant in Harrison and Noble counties. Like the Chesapeake project, the MarkWest plants will be linked by an extensive network of pipelines, connecting what’s taken out of the ground in eastern Ohio’s Utica shale with the processors who enable the dry gas and wet gas -- butane, propane and ethane -- to go to market.
“The first step in processing gas rich in liquids is the reverse of refining,” Passela explains. “In refineries, you heat up crude oil and as it boils off, you get different products. In natural gas, in order to extract liquids, you reduce the temperature to varying degrees below zero, and as you do that, the liquids condense and they drop out of the gas stream.”
Thus the wet gas is separated from the dry gas at a cryogenic processing plant, the industry term for the facility to be built in Kensington.
The next step is fractionation, which will occur at the Harrison County plant. The term is derived from the fractions of different liquid gases that need to be further separated. “You have to pass that raw mix through a fractionator,” Passela continues.
The eastern Ohio processing facilities to be built by Chesapeake and its partners will compete with the processing facilities to be built by MarkWest in eastern Ohio, although in other shale plays where MarkWest already operates such plants, Chesapeake is one of its customers.
"Companies like Chesapeake, Range Resources, Anadarko, Gulfport, Conoco, BP -- these are our customers," says the CEO of MarkWest, Frank Semple. "These are the ones that do the drilling. We take it from there."
MarkWest has a deal with Gulfport Energy to process its gas at the Harrison County plant, which also is expected to begin operations in the second quarter of 2013.
“We have gas and acreage dedicated to our system from three companies, who also happen to be joint venture partners,” Passela notes. “MarkWest has acreage and gas dedicated from one company.”
The Chesapeake and MarkWest processing plants each will have the capacity to process 200 million cubic feet of gas per day; Chesapeake’s fractionator will separate 600 million cubic feet of wet gas per day. MarkWest has not said where it will build its eastern Ohio fractionator.
During the first phase of Chesapeake's midstream services project, most of the $900 million investment will be made. But there could be substantial second phase, when more capacity is added to both plants, Passela says. “That’s to be determined. It depends on how the drilling progresses and how much additional volume has to be gathered and processed.”
Wednesday, March 14, 2012
From Gung-Ho to Uh-Oh: Charting the Government’s Moves on Fracking
by Lena Groeger
ProPublica, Feb. 7, 3:03 p.m.
ProPublica, Feb. 7, 3:03 p.m.
Feb. 27: This timeline has been corrected.
Fracking has only recently become a household word, but government involvement with the drilling technique goes back decades. President Obama has championed the potential of natural gas drilling combined with more regulation. While there has been mounting evidence of water contamination, few regulations have been implemented. The graphic below traces officials' moves -- and levels of caution -- over time.
Sources: Environmental Protection Agency, Department of Energy, Bureau of Land Management, Department of the Interior, The Sierra Club
Correction: We originally placed the AltaRock entry in 2009. We've moved it to 2008 because that's when the DOE initially funded the project. We also made a few clarifications: Readers have pointed out that the name used to refer to the project, AltaRock, is also the name of the company running it. While there was much concern about the project causing an earthquake, the Department of Energy says drilling difficulties forced a project shutdown first
Fracking has only recently become a household word, but government involvement with the drilling technique goes back decades. President Obama has championed the potential of natural gas drilling combined with more regulation. While there has been mounting evidence of water contamination, few regulations have been implemented. The graphic below traces officials' moves -- and levels of caution -- over time.
Gung-ho Uh-oh 
| Before 2000 | 2000-2008 | 2009 | 2010 | 2011 |
1969 The government detonates a 43-kiloton nuclear bomb deep underground in an effort to get at natural gas deposits in Colorado. The gas unlocked by "Project Rulison" is deemed too radioactive to use.
|
June 2004 An EPA report concludes that fracking is safe for drinking water. The report, which didn't include a scientific study, has since been criticized as politically motivated.
|
June Congress introduces the FRAC Act, a law that would allow the EPA to regulate fracking and require companies to disclose the chemicals they pump into the ground. The bill never came to a vote.
|
February The House Committee on Energy and Commerce launches an investigation into the potential environmental and health impacts of fracking.
| |
1976 In response to energy shortages, the DOE launches the Eastern Gas Shales Project, a joint research project between state, federal, and private industrial organizations to research "unconventional" natural gas resources.
|
August 2005 Congress passes a law prohibiting the EPA from regulating fracking under the Safe Drinking Water Act. In most other cases the law dictates what chemicals can be injected underground.
|
August In response to complaints of drinking water contamination, the EPA begins investigating wells in drilling areas of Pavillion, Wyoming. Initial testing finds at least three water wells that contain a chemical used for fracking.
|
March The EPA launches a study looking at the impacts of fracking on drinking water nationwide. The final report is due out in 2014.
|
April Congressional Democrats release a report stating that over the past few years gas drillers have injected millions of gallons of fluids containing potentially toxic chemicals into the ground.
|
1986 As part of an early federal effort to investigate new methods of extracting natural gas, the Department of Energy sponsors the drilling of a 2,000-foot horizontal well in the Devonian shales of Wayne County, WV.
|
August 2005 The Ultra-Deepwater and Unconventional Natural Gas and Other Petroleum Resources Research Program is established to develop technologies to increase national oil and gas production and reduce dependency on imports.
|
October The Obama administration rescinds the 2007 memo that loosened restrictions on air pollution caused by drilling.
|
December The Department of the Interior holds a forum to discuss the impact of current drilling practices and to consider a policy requiring companies to disclose the chemicals they use for fracking. President Obama has spoken in support of such a policy, but no official rules have been implemented.
|
May A federal panel releases a report concluding that current fracking regulations may not be enough to protect the environment and public health. That same month, Congress introduces the BREATHE act, which would give the EPA power to regulate air pollution from fracking. It has yet to pass.
|
1994 The Legal Environmental Assistance Foundation uses the Safe Water Drinking Act to challenge the EPA's decision not to regulate fracking in Alabama. The EPA maintains that it is under no such legal requirement. Two years later, the case reaches a federal appeals court which rules against the EPA, saying the agency is in fact required to regulate fracking (at least in Alabama). The decision prompts an effort to exempt fracking from regulation, and in 2005, an exemption is passed by Congress.
|
January 2007 A Bush administration memo effectively loosens the limits on air pollution from many natural gas wells.
|
DecemberIn a controversial decision, the Bureau of Land Management approves gas drilling within a three mile buffer zone of a radioactive Colorado site, the home of the 1960's nuclear test Project Rulison.
|
July 2011 The EPA proposes a set of regulations to reduce harmful air pollution from oil and natural gas production, specifically targeting compounds released by fracking. The regulations have not yet been adopted.
| |
October 2008 The Department of Energy funds AltaRock, a project to extract renewable energy from hot bedrock by fracking more than two miles deep. The test, which a year later the Obama administration makes its first major geothermal venture, is cancelled quickly due to, among other things, concerns about causing an earthquake.
|
October The EPA announces a plan to issue new national rules for fracking wastewater. The process is still in its early stages, and the EPA is currently simply soliciting input.
| |||
November In response to a petition by environmental groups, the EPA agrees to develop rules requiring companies to test and submit data on the chemicals they use for fracking. Again the rules are not yet set.
| ||||
December An EPA draft report concludes that contaminants in Pavillion, Wyoming most likely seeped up from gas wells, scientifically linking water contamination to fracking for the first time.
|
Correction: We originally placed the AltaRock entry in 2009. We've moved it to 2008 because that's when the DOE initially funded the project. We also made a few clarifications: Readers have pointed out that the name used to refer to the project, AltaRock, is also the name of the company running it. While there was much concern about the project causing an earthquake, the Department of Energy says drilling difficulties forced a project shutdown first
Columbiana County project expected to employ hundreds
By Karl Henkel
HANOVERTON
A trio of energy companies plan to build a $900 million natural-gas processing plant in eastern Ohio.
The project includes a gas-separating facility near Hanoverton in Columbiana County and a centralized complex in nearby Harrison County.
The project, which will be rolled out during the next five years, is expected to employ hundreds of Ohioans, Oklahoma-City based Chesapeake Energy Corp. said Tuesday.
Chesapeake, through affiliates of its subsidiary, Chesapeake Midstream Development L.P., entered into a partnership with M3 Midstream LLC and EV Energy Partners, L.P. to develop the project.
Columbiana County Commissioner Jim Hoppel confirmed knowledge of the project, but said he was unaware of its exact location.
He said the county provided no economic incentives.
“We knew about it, but we didn’t have to say anything other than ‘Go, guys, go,’” said Tracy Drake, executive director of the Columbiana County Port Authority.
Chesapeake said significant engineering has begun for the project. Some operations are expected to begin by the second quarter of 2013.
The Columbiana County facility, which will process natural gas and natural-gas liquids from the liquids-rich Utica Shale, will have an initial capacity of 600 million cubic feet per day.
At a gas-separating facility, also known as a cryogenic processing plant or stripping plant, natural gas from wells is cooled to subzero temperatures to condense natural-gas liquids such as butane, ethane and propane. Those liquids are then used in refineries and plants which create plastics.
Shell Oil last June announced the plan for a cracker, or petrochemical plant, which has been rumored to go somewhere in southeast Ohio.
An official announcement from Shell is expected this month.
The cryogenic plant would make gas appropriate for every-day use.
Natural-gas liquids will be delivered to a centralized complex in Harrison County, part of the same project, that will have an initial liquid-gas storage capacity of 870,000 barrels.
Can a driller go under my property with no lease?
Does anyone on this blog know: Can the driller next door to me go under my property with the horizontal shaft, even if I have not signed a lease agreement with them?
Tuesday, March 13, 2012
Ashtabula Country Commissioners Meeting 3/14/2012 6:00pm
One of our neighbors has forwarded this meeting notice on for us. Perhaps some of you can attend to ask our County Commissioners to begin the discussion with Ashtabula County residents who have concerns about the drilling and the brine disposal that is coming our way. It may be another chance to let our elected officials know that we have questions about the drilling coming our way.
Thanks for being interested,
Gail Larson
Thanks for being interested,
Gail Larson
Additional Comments for the Windsor Meeting on 3/26/2012
I hope that someone can talk about things that the local cities and townships CAN do:
· Educate landowners: hold info meetings, send residents info, put a link to helpful info on their website, etc.
· Not spread brine on roads (our website has a list of counties / cities / townships that can spread brine on roads)
· In Mansfield, the Law Director has suggested significantly increasing the property tax for land with injection wells. This may be something to pursue in Windsor, etc.
· Townships can work with the County Engineer and Commissioners to enact the protective road agreement (10 pages) not the one the industry is shopping around (2 pages with vague language) (10-page lease is on our website)
· Ban fracking and injection wells on township or city property
· Ban fracking throughout the city / township (www.celdf.org the citizens-rights-based ban)
What citizens can do:
· Work within their community to educate their neighbors: pass out flyers hold meetings, show Gasland, etc.
· Become part of the county group and yet work locally
· Educate their local elected officials (it’s amazing how little some of these people know)
· Push their local elected officials to take the above-mentioned actions
Vanessa Pesec
EDUCATIONAL MEETING ON FRACKING - Windsor, OH
OFU is sending out meeting notices to members in the NE Ohio region. Ashtabula Farmers Union is sponsoring the meeting. The OFU state director and state president. We are fortunate to have Joe Logan as a resource here. He has credibility with farmers because he was a dairy farmer until recently in Kinsman, still milks sometimes on the weekends, and his brothers are still on the family farm. And Joe is president of Trumbull Co Farmers Union and on the OFU exec board.
Mardy
•EDUCATIONAL MEETING on FRACKING•
LEARN ABOUT THE TWO FRACKING WASTE WATER INJECTION WELLS IN WINDSOR
EDUCATIONAL PRESENTATION BY JOE LOGAN OF THE OHIO ENVIRONMENTAL COUNCIL
LEARN ABOUT TESTING YOUR WELL WATER.
COME AND LEARN ABOUT THIS IMPORTANT COMMUNITY ISSUE
Monday March 26 6:30 PM at Windsor Community Center
5430 Mayfield Road, Windsor, Ohio 44099
For further information call 440-272-5154 or 440-272-5174
SPONSORED BY ASHTABULA GEAUGA LAKE FARMERS UNION
Mardy
•EDUCATIONAL MEETING on FRACKING•
LEARN ABOUT THE TWO FRACKING WASTE WATER INJECTION WELLS IN WINDSOR
EDUCATIONAL PRESENTATION BY JOE LOGAN OF THE OHIO ENVIRONMENTAL COUNCIL
LEARN ABOUT TESTING YOUR WELL WATER.
COME AND LEARN ABOUT THIS IMPORTANT COMMUNITY ISSUE
Monday March 26 6:30 PM at Windsor Community Center
5430 Mayfield Road, Windsor, Ohio 44099
For further information call 440-272-5154 or 440-272-5174
SPONSORED BY ASHTABULA GEAUGA LAKE FARMERS UNION
Fracking’ payoffs luring local officials - Let's keep this out of our area
Fracking’ payoffs luring local officials
The lure of big money created by Ohio’s growing shale energy boom has enticed
thousands of landowners to sign leases with oil and gas companies. With offers
surpassing $5,000 an acre, many government and school officials are considering
doing the same.
“It doesn’t take a whole lot of acres to come up with $1 million pretty quickly,” said Thomas Gentile, a Jefferson County commissioner. The engineer’s office there is poring over records to compile a list of county-owned properties that might fit the bill.
“We want to see where the lands are, how big they are and what the interest might be,” Gentile said.
Similar what-if exercises are going on across eastern Ohio. On one side is an opportunity to bring revenue to a school, town or village. On the other are questions about the environmental impact of the method used to remove gas and oil from shale — hydraulic fracturing, or “ fracking."
The mineral-rights leases typically pay landowners upfront bonuses as well as a percentage of the value of any oil and gas that come out of the ground. Yet environmental advocates argue that the drilling process threatens property owners’ water, soil and air.
In fracking, millions of gallons of water, sand and chemicals are injected into wells to shatter shale and free trapped oil and gas. “This industrial process has contaminated drinking water and produced highly polluted air in the states where it has been used,” said Heather Cantino, a member of the Athens County Fracking Network.
Industry officials say the process is safe. Tom Stewart, vice president of the Ohio Oil and Gas Association, said it’s common for cities and schools to sign leases.
“It often involves recreation facilities, like golf courses,” he said.
But not all officials are willing. Paula Horan Moseley, the Athens city service director, said drilling poses a contamination threat to wells that provide residents with drinking water. The city opposes proposals that would open lands in the nearby Wayne National Forest to drilling.
At nearby Hocking College, however, officials have created a committee to study a proposed $3 million deal with West Virginia-based Cunningham Energy to lease 1,200 acres west of campus near Nelsonville.
“We are being somewhat cautious about jumping on the bandwagon,” said college President Ron Erickson. “We have to weigh the potential environmental impact.”
Officials at Denison University in Granville have considered similar issues. The university received some “preliminary interest” in leasing about 45 acres of farmland just north of campus, said Seth Patton, Denison’s vice president for finance and management.
Patton said the school allowed the company, Newark-based Flint Ridge Energy, to run seismic tests on the property last year.
“We’re reasonably convinced that it can be done in a safe manner,” Patton said. “We’d like to know what the impact on the land itself is.”
Back in Jefferson County, Steubenville council members have approved a deal with Hess Oil that opens a 110-acre site west of town for drilling. At $5,400 an acre, the city will receive more than $590,000 in a one-time bonus, said city manager Cathy Davison. The city will receive a 19 percent royalty on the value of gas or oil that comes up at the site.
Davison called the agreement an opportunity to start cleaning up an old city landfill on the property. She said an Ohio Environmental Protection Agency order to eliminate groundwater pollution and cap the old dump, which closed in 1983, would cost about $10 million.
“Steubenville has had one of the highest unemployment rates in the country. Our residents can’t afford $10 million,” Davison said. “This is a down payment toward starting this project.”
“It doesn’t take a whole lot of acres to come up with $1 million pretty quickly,” said Thomas Gentile, a Jefferson County commissioner. The engineer’s office there is poring over records to compile a list of county-owned properties that might fit the bill.
“We want to see where the lands are, how big they are and what the interest might be,” Gentile said.
Similar what-if exercises are going on across eastern Ohio. On one side is an opportunity to bring revenue to a school, town or village. On the other are questions about the environmental impact of the method used to remove gas and oil from shale — hydraulic fracturing, or “ fracking."
The mineral-rights leases typically pay landowners upfront bonuses as well as a percentage of the value of any oil and gas that come out of the ground. Yet environmental advocates argue that the drilling process threatens property owners’ water, soil and air.
In fracking, millions of gallons of water, sand and chemicals are injected into wells to shatter shale and free trapped oil and gas. “This industrial process has contaminated drinking water and produced highly polluted air in the states where it has been used,” said Heather Cantino, a member of the Athens County Fracking Network.
Industry officials say the process is safe. Tom Stewart, vice president of the Ohio Oil and Gas Association, said it’s common for cities and schools to sign leases.
“It often involves recreation facilities, like golf courses,” he said.
But not all officials are willing. Paula Horan Moseley, the Athens city service director, said drilling poses a contamination threat to wells that provide residents with drinking water. The city opposes proposals that would open lands in the nearby Wayne National Forest to drilling.
At nearby Hocking College, however, officials have created a committee to study a proposed $3 million deal with West Virginia-based Cunningham Energy to lease 1,200 acres west of campus near Nelsonville.
“We are being somewhat cautious about jumping on the bandwagon,” said college President Ron Erickson. “We have to weigh the potential environmental impact.”
Officials at Denison University in Granville have considered similar issues. The university received some “preliminary interest” in leasing about 45 acres of farmland just north of campus, said Seth Patton, Denison’s vice president for finance and management.
Patton said the school allowed the company, Newark-based Flint Ridge Energy, to run seismic tests on the property last year.
“We’re reasonably convinced that it can be done in a safe manner,” Patton said. “We’d like to know what the impact on the land itself is.”
Back in Jefferson County, Steubenville council members have approved a deal with Hess Oil that opens a 110-acre site west of town for drilling. At $5,400 an acre, the city will receive more than $590,000 in a one-time bonus, said city manager Cathy Davison. The city will receive a 19 percent royalty on the value of gas or oil that comes up at the site.
Davison called the agreement an opportunity to start cleaning up an old city landfill on the property. She said an Ohio Environmental Protection Agency order to eliminate groundwater pollution and cap the old dump, which closed in 1983, would cost about $10 million.
“Steubenville has had one of the highest unemployment rates in the country. Our residents can’t afford $10 million,” Davison said. “This is a down payment toward starting this project.”
Plain Dealer Article - Judge's Ruling and it's affect.
Chesapeake Exploration poured this
12-acre concrete pad for drilling for shale oil and gas at a Harrison County
hunting club before a judge's ruling halted its operations.The county was a hotbed of abolitionist activity in the years leading up the Civil War. It's where General George Armstrong Custer and Edwin Stanton, President Lincoln's secretary of war, were born. And on Charleston Street, in the county seat of Cadiz, is a two-story, white frame house that is the birthplace of actor Clark Gable.
In recent years though, Harrison County has been out of the spotlight, but a judge's ruling could change that.
Harrison County Common Pleas Judge Michael Nunner has sharply limited Chesapeake Exploration's ability to drill for shale gas and oil from a property where the company has leased the mineral rights. The ruling is rattling an industry that Cleveland State University economists predict could pump $5 billion a year into the state's economy by 2014.
"It could affect Chesapeake and other drill companies across Ohio," said David Hudson, who represents the Jewett Sportsmen and Farmers Club, the landowner that sued Chesapeake.
Nunner said while Chesapeake can vertically extract gas and oil from underneath the hunt club's 187 acres of woods and fields, the energy company can't use the land to drill sideways to get at reserves from adjacent land.
He ordered Chesapeake, a dominant player in Ohio's shale production, to stop horizontal drilling that extends beyond Jewett's property line unless it gets the club's permission to go ahead.
Extracting natural gas and oil from shale formations depends on lateral drilling to carry millions of gallons of water under intense pressure to fracture surrounding rock. Horizontal bores can extend up to 10,000 feet, or almost two miles, from the drill hole. Chesapeake already had poured a 12-acre concrete pad for rigs but has sunk no wells.
"They don't have a right to come in and destroy our surface without fair compensation," said Jewett club president John Harris.
A spokesman for the Oklahoma-based Chesapeake declined comment. So did North American Coal Co., which owns the mineral rights and leased them to Chesapeake.
The coal company, in a motion earlier this month, asked Nunner to reconsider his order that effectively halted Chesapeake's ability to profitably plumb the shale rock some 8,000 feet below ground.
North American Coal, in its motion, said that the order directly conflicts with Ohio public policy to encourage development of natural resources "by halting any oil and gas production through the use of contemporary horizontal drilling methods on this property."
By creating an "erroneous new law, it would impede or prevent the development of oil and gas elsewhere in Ohio, with significant adverse effects for the state's economy," the company said.
Harris said the club's 190 members are about evenly divided between those looking for a good settlement from Chesapeake in exchange for their approval on drilling and those wanting the company to go away.
The club, in the center of Harrison County, about seven miles north of Cadiz, dates back to 1959 when its 12 founders took out a bank loan to buy a chunk of land they were leasing to hunt white-tailed deer, jackrabbits and wild turkey.
"It makes us a unique piece of property because there's no houses around," Harris said. "We're sitting right there in the middle of nowhere."
Members today raise money by renting out a lodge for wedding and graduation parties, throwing annual corn roasts and raffling off all-terrain four-wheelers. They spend about $1,000 a year stocking three lakes at the club with bass, blue gills and crappies.
After Nunner blocked horizontal drilling, Chesapeake approached Harris about starting from square one and working out a deal.
"We sent our (monetary) demands and have not heard another word since," Harris said. He would not elaborate on the proposed settlement.
North American Coal deeded the land to the club in 1959, said Gregory Brunton, a lawyer for the Cleveland-based Reminger law firm that represents the club.
Coal companies across eastern Ohio often sold off surface real estate when they were done mining. But those companies held on to the underground mineral rights in case they wanted to go back in and take out more coal, or oil and gas.
Ohio law says owners of such "severed" mineral interests have a right to "reasonable" use of the surface to get at the minerals.
Brunton said the club's deed didn't anticipate shale gas extraction -- which requires not only long horizontal wells, but also large well pads with multiple wellheads on each, storage tanks on site, and convoys of trucks hauling in millions of gallons of water.
The Jewett lawsuit is one of the latest legal fights shaping up over shale gas drilling in Ohio.
In a separate lawsuit filed this month, 33 landowners in Columbiana County contend that land men concealed or actively misled them about how much surface and below-ground disruption was involved in shale gas extraction. And in Akron, Chesapeake sued 95 landowners in January for attempting to get out of their leases and sell them to another bidder.
In this latest case, Reminger attorneys representing the sportsmen's club have been fielding calls from other lawyers who wonder about the impact of the Harrison County case on the landowners they represent.
If Jewett Sportsmen and Farmers Club and Chesapeake can't settle their dispute, the case is expected to go to trial on the club's claim that Chesapeake trespassed on its property.
"It may have potentially wide ramifications," said Brunton, who considers the case precedent-setting in Ohio.
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