Famous Buell well (Buell 8H) about to be shut down!!! Chesapeake doesn't own horizontal drilling rights!

Looks like Chesapeake's "best shale well ever" is actually owned by Kenneth Buell.

You can find all the relevant court documents (very hard to get your hands on - rural public records...) and analysis here:

And the Buell well will soon look like this.

p.s. the well is in Harrison County, Ohio.

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Permalink Reply by Buell Well on July 11, 2012 at 9:01am

I take that back Marcus. I am sure you are very good at what you do. Heat of the moment.

Permalink Reply by Buell Well on July 11, 2012 at 6:56am

Marcus:

And you're wrong about ODNR not issuing permits without a lease being signed. All ODNR requires is a written statement from the applicant saying "we have drilling rights" to all the parcels in the unit. ODNR does not ask drillers to produce leases, let alone READ any leases to ensure they confer the rights claimed and are valid and current.

So...when Chesapeake or anyone else drills on a permit they obtained in bad faith or simply mistake/misinterpretation of an old oil and gas lease, what is your recourse? The courts and judges like Nunner who won't get bullied or impressed by high priced lawyers from the big city who don't know a bore hole from their backside.

0i7okn54zwbdoPermalink Reply by 0i7okn54zwbdo on July 11, 2012 at 7:49am

You're talking about a mineral trespass which is an entirely different issue from the one we're discussing.

Permalink Reply by Buell Well on July 11, 2012 at 8:12am

Huh? I'm just using your example, Marcus. You said:

"there's no way to drill a well without having a lease in place. ONDR will not issue a permit unless there is proof of a lease or a forced pooling agreement."

That's NOT TRUE. All CHK or Shell or anyone else has to do is send ODNR a written statement saying they have the drilling rights. They don't have to submit proof (no leases) so CHK can say whatever they want. The only way they will get caught and have to pay is if people find attorneys who are willing to stand up for rights rather than play "go along to get along" with huge companies and if you have courts sworn to uphold property rights.

And if they won't uphold landowner rights, why are you so sure they would uphold mineral owner rights? Or CHK's rights for that matter? Disgarding property rights and free contracting makes us no better than Hugo Chavez.

Permalink Reply by Frank Nesmith on July 11, 2012 at 8:51am

Buell Well is correct. ODNR or DEP in PA could care less if the driller has obtained the mineral rights. That is strictly between the driller and the owner of said rights. Here in PA, Chesapeake has gone onto the McRoberts property when they did not own the mineral rights (because the leases were invalid (most of them were invalid). They cut down trees, built a pad and drilled a pilot hole on these peoples property that owned the invalid leases. 17 landowners are still in a lawsuit over that. Heck, CHK didn't even have a valid permit from the Township and now the Township is taking them to court over CHK ignoring a Cease and Desist Order. Neither the state or the Twp. has any right to get involved in the valid lease issues. 

It's drillers like them that give all the drillers a bad name. It started out that the owners just wanted a fair and legal contract, but it's left such a bad taste in their mouths that now they don't want any drilling at all. The "invalid" leases expired in April while CHK was putting up the pad. I guess the moral of the story is exactly what Buell Well is saying. 1. Chesapeake doesn't care about anyone's rights. 2. They threw away chances to make things right and let situations get entirely out of control and now it will cost them even more. 

You would think they would learn a lesson, but that just doesn't seem so. I know 3 year olds that learn lessons faster.

Here are more questions.

1. Will the coal company have to pay back the signing bonus if it's found that they never truly owned the rights?

2. Will the coal company have to pay back any royalties they received to date?

3. Will the adjoining landowners in the production unit lose what they have already received in royalties to date?

One final thought is that if I were Mr. Buell, sure I'd like to see a big payout, but I'd be red hot mad by now and want nothing more than to see that well shut down. In my eyes, HE should get all the royalties that have been paid on the whole unit to date because nobody would have gotten anything if they didn't use his land in the first place.

Shut'er down!

Permalink Reply by Buell Well on July 11, 2012 at 9:10am

The North American Coal Royalty Company "owns" most of the mineral rights in that area. So they would be the ones losing the royalties, if back royalties have to be paid to Buell.

Permalink Reply by Frank Nesmith on July 11, 2012 at 9:34am

Yes, but logically thinking. If a judge would rule that all prior royalties were due to Mr. Buell, the judge wouldn't give a rats ass if they were already paid out. They would simply be calculated and included in the judgement and marked "Due to Mr. Buell by CHK"

CHK would then have to pay and it would be up to them to go after the royalties already paid out if they so choose. They would probably lose that battle as the parties that received them, did so in good faith, thinking they were due them. It would also be CHK's fault for not paying the proper person, so I don't see them getting anything back off the people that got them in the first place.

Permalink Reply by Buell Well on July 12, 2012 at 1:43am

Shut her down indeed. That's what happened at Jewett Sportsman Club when CHK bulldozed acres of leisure land and that's what going to happen with the Buell 8H. It's amazing - shocking actually - that some suggest you need a vendetta against this company or that to be favor or property rights, landowners rights specifically. What else could you be in favor of??

Permalink Reply by Buell Well on July 12, 2012 at 1:46am

You could just as easily argue you need a vendetta against a 70 year old farmer and all Harrison County/Ohio Valley landowners to argue against millions in actual damages, and many millions more in punitive damages on top of that. If its a $20 million profit well then I say give at least half of that to Buell. I bet that's what a jury would do.

Permalink Reply by Dan on July 12, 2012 at 2:13am

Why do you say half?  No one gets half!  Mineral owners are getting 12.5% to 20% royalties, and surface-only owners are getting $10,000 to $30,000 in damages for putting a well pad in.  So even if you want to give Buell the whole enchilada by making him the rightful mineral owner, then why would he get more than anyone else is getting?

Permalink Reply by joe pierson on July 12, 2012 at 4:43am

You must be a big Karl Marx fan if you believe mineral rights should be automatically taken from it's evil "corporate owner" and given to someone else.

Permalink Reply by Buell Well on July 12, 2012 at 8:22am

Joe:

Wow, that was Orwellian, 1984 double speak if I ever heard it. I am in favor of property rights and good faith negotiations over power-plays and schoolyard bullying tactics. It's not clear at all from your off-the-handle statement what you are in favor of. FYI, Jewett Sportsmen Club is technically a corporation. Yet I am defending them because their PROPERTY RIGHTS were flagrantly violated. I realize not everybody is as familiar with this litigation as they would like to be, but lets keep things grounded in fact and move from there.

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