Natural Gas Driller Gulfport Sues Barnesville To Use Water

Company says it has right to purchase from reservoir

March 19, 2015
By CASEY JUNKINS Staff Writer , The Intelligencer / Wheeling News-Register

BARNESVILLE - Citing a potential loss of "millions of dollars," Marcellus and Utica shale driller Gulfport Energy is suing the village of Barnesville for the right to draw water from the Slope Creek Reservoir for its nearby fracking operations.

Filed earlier this month in U.S. District Court for the Southern District of Ohio, Gulfport's lawsuit claims the Oklahoma City-based firm should be allowed to take water from the reservoir, located about five miles south of the village, unless the "health and safety of area residents and businesses are impaired."

"Barnesville has frustrated Gulfport's right to develop minerals under the mineral rights agreement by refusing to provide Gulfport with water in violation of Gulfport's water rights," company attorney O. Judson Scheaf states in his complaint. "Barnesville has wrongfully maintained that Gulfport's water rights are limited by the 2014 water use agreement between Barnesville and Antero" Resources.

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Gulfport Energy is suing the village of Barnesville because the company believes it has the right to draw fracking water from a local reservoir.

Court documents show that on Aug. 17, 2012, Barnesville officials signed an agreement permitting Gulfport to buy water from the Slope Creek Reservoir at a price of one cent per gallon. The contract shows the firm would be able to draw the water until a point when the village would determine such action would endanger public health.

Less than one month later, on Sept. 10, 2012, village leaders signed an oil and natural gas lease with Denver-based Antero, another significant driller in the western Belmont County area. Antero agreed to pay the village $5,700 per acre along with production royalties of 20 percent once gas starts flowing. Antero later signed the Barnesville Exempted Village School District, as well as many individual mineral owners in and around the corporation limit, to similar deals.

Scheaf said Gulfport and Antero reached a mutual development agreement in June. Now, Gulfport believes it should have "assurances of performance" to ensure that it can attain enough water to support fracking operations.

Barnesville officials have not yet filed a response to Gulfport's complaint. Village Administrator Roger Deal Wednesday referred questions to Village Solicitor Marlin Harper, who could not be reached for comment.

David Castle, a spokesman for a group known as the Concerned Barnesville Area Residents, said frackers had been drawing water from the reservoir until officials told them to stop last fall because the water level dropped so low.

"It's been a tremendous source of concern for the community. We sent a petition signed by 2,500 people to Gulfport asking them to move their drilling pads farther away from the reservoir," Castle said.

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"David Castle, a spokesman for a group known as the Concerned Barnesville Area Residents..."

Any time a group has the word concerned in their name you can bet they are wannabe socialist busybodies.

And if they were concerned citizens against windmills in their back yard?

One could say you can bet one that would make such a blanket statement is an elitist.

Concerned = enviromental cases!

http://www.timesleaderonline.com/page/content.detail/id/574305.html

Barnesville lawsuit to prove costly

April 6, 2015
By CASEY JUNKINS - For The Times Leader Times Leader

BARNESVILLE -- Even if village officials successfully debunk Gulfport Energy's claim of holding specific rights for drawing water from the Slope Creek Reservoir for nearby fracking, the litigation will likely soak Barnesville taxpayers.

Barnesville Village Solicitor Marlin Harper said officials will need to hire outside counsel to defend themselves against Gulfport in U.S. District Court for the Southern District of Ohio. The Oklahoma City-based fracker filed the suit last month, citing a potential loss of "millions of dollars" if it does not receive assurances that it can draw water from the reservoir, which is about 5 miles outside the village.

"It could be a substantial expense. The bigger city law firms charge hundreds of dollars per hour," Harper said, noting he believes the village of 4,100 residents needs a law firm accustomed to handling federal litigation.

"We never thought we would be sued in federal court by a large corporation," he added.

Columbus-based Gulfport attorney O. Judson Scheaf cites an Aug. 17, 2012, agreement Barnesville officials signed that allows the fracker to buy water from the reservoir for $10 per 1,000 gallons. The contract shows the firm would be able to draw the water until a point when the village would determine such action would endanger "health and safety of area residents and businesses."

"Barnesville has frustrated Gulfport's right to develop minerals under the mineral rights agreement by refusing to provide Gulfport with water in violation of Gulfport's water rights," Scheaf states in his complaint.

Harper said the contract to sell Gulfport water made no supply agreements with the company to provide a certain amount of water at any specific time, adding, "We made it clear to everyone we were selling to multiple companies."

In September 2012, just one month after village leaders signed the Gulfport water deal, they entered a drilling contract with Denver-based Antero Resources to pay $5,700 per acre along with production royalties of 20 percent once gas starts flowing. Then, in May 2013, Barnesville officials signed an agreement to sell a non-specific amount of fracking water to Antero from the same reservoir for $3.75 per 1,000 gallons.

As the lawsuit proceeds, the western Belmont County town and its surrounding areas are flush with fracking-related activity.

"You hear about the price of oil going down and people getting laid off. They are going full bore here," Jim Bygrave, owner of The Raven Pickers antique shop, said. "Water trucks, brine trucks and sand trucks are going past my house 24/7."

Bygrave enjoys fishing for bluegill and bass in the reservoir, while he said other residents often go there to simply "chill out" in the summer.

"If it is the drinking water, they should stop at a certain point," he said of the reservoir that provides water to thousands of Barnesville area residents. "Still, a contract is a contract."

Brian Mayhugh, co-owner of the Barnesville Antique Mall, said he didn't know enough about the lawsuit to comment on it, but he believes the industry has been good for the community.

"It's made a positive impact, financially, for a lot of people, for sure," he said.

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