Force pooled

Article in the Steubenville Herald Star today. Several landowners in the Lisbon Ohio area were force pooled into a unit . No signing  bonus and 12/12% royalties.  Chesapeake  was the gas company.

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Permalink Reply by Lane Mitchell on February 10, 2014 at 11:28am

AEP in Noble County trying same thing. Sign up or no well.

Permalink Reply by Philip Brutz on February 10, 2014 at 11:43am
Permalink Reply by Frank Walker on February 10, 2014 at 1:11pm

It is shocking, is it not, that so landowner-friendly a company as Chesapeake would do such a thing as this!!  Also, hogs can fly.

And I had to laugh at the mention, in the article, of a 12.5% royalty fraction.  AFTER deductions, those landowners force pooled will be fortunate not to be paying Chesapeake for the privilege of having their NG stolen right out from under their land . . . er . . . I mean their former land!

Permalink Reply by Ragnars Repo on February 10, 2014 at 3:12pm
I agree it is an underhanded move by a company like Chesapeake to force pool.
What's more disturbing is we have government that allows it. Republican and democrat. If we continue to vote for those who believe the constitution is a charter of negative liberties we will lose liberties. Life, liberty, and property was the original.
Permalink Reply by BIG on February 11, 2014 at 2:10am

This isn't something new.  The oil and gas companies try to work with the landowner as much as possible, but if no deal is struck they will file the papers to pool in the landowners. 

Remember, people that are holding out for whatever reasons they have, are holding up the drilling process and hurting the landowners around them that are ready for the area to be developed.  I would be upset if all my neighbours had signed and then two or three were holding out and my unit couldn't be developed.  The pooling process is normally the last resort a company would take to clear things up.  There is probably a long process to get a pooling done because you would be dealing with the courts/government regulations.

Permalink Reply by old trapper on February 11, 2014 at 2:22am

Most hold out's are people with 2 acres or less !

Permalink Reply by Dave C on February 11, 2014 at 2:32am

This was the case on our drilling unit with Rice at the Bigfoot well pad.  According to their permit, one owner of .9 acres would not sign.  The permit application had copies of emails and letters sent to the owner offering more than the rest of us had received.  According to the paperwork, the owners refused all offers.  Rice requested a variance and it was granted. 

I will say that the Rice specifies that they won't use perforated pipe within 500 feet of that unsigned property.  I am unfamiliar with the process, so I don't know if that is the SOP in those cases or not.  I am also not judging Rice's truthfulness in their application only what it stated.  

I do not like that a homeowner can be forced into a pool, but don't think one homeowner should hold up an entire unit.  The Bigfoot drilling unit is 562 acres and it was held up by one owner over .9 acre for several weeks.  In cases like that, I don't know what else can be done. 

Permalink Reply by Ragnars Repo on February 11, 2014 at 5:29am
I hope you are all as cooperative when someone decides a freeway must be placed through the middle of your farm. You know, because your pesky property rights are making my commute to work longer. Or because the NIMBY crowd thinks your land is less valuable and therefore it's better for the collective to use it.
Permalink Reply by Renee E. Dorsey on February 11, 2014 at 10:57am

Hmm - I can see both sides of this issue.  One one hand, I 100% agree with Ragnar (btw, one of my favorite characters!) in the inherent right of personal property and I am opposed to the concept of eminent domain or the confiscation of one's property for the "common good" - loose term, that one - by any Govt. entity, be it local, etc.    Just remember - if you want to go down rabbit hole, that unless you pay your property taxes you really never truly own your property.   

However, I have seen - in my own area - that it is often one sour apple that has a stick up in a place where the sun doesn't shine that has to ruin it for everyone around them.    Even with a tight lease, and the landman promising to give the hold out the same exact terms, the person wants nothing to do with this business.    So, yes - the law exists for that purpose. If your lease specifically states that NOTHING will be placed on or near your property, EVER, why not sign?  Other than it being an environmental quack reason?    Take the deal if you have had the lease vetted by a competent attorney!      This energy opportunity is the last hope for the Ohio Valley for sure;  nothing is happening here other than mill after mill (RD Steel, Ormet, etc.) shutting doors and laying off a few thousand employees.    Not everyone in the valley wants to move to Columbus for a job.  Been there - Cleveland area too, years ago - and came back.   Try to find a way to capitalize on this boom.   Open a niche business to cater to them.   Strike while the iron is hot; quit complaining about the "old days" - for some reason, we have been given a new opportunity and I for one, am not going to squander it.    "

"I swear by my life, and my love of it, that I will never live for the sake of another man, nor ask another man to live for mine." 
Permalink Reply by INVICTUS on February 11, 2014 at 3:48pm

Hmmmm. I guess I should ask: Who is John Galt?

Permalink Reply by Mark McGrail on February 11, 2014 at 3:21am

Big,

It is a last resort because it is a drawn out process. The ODNR recentlly wrote new rules governing the procedure along with a $10,000 fee. The rules can be found on the ODNR web site under unitization.

Permalink Reply by Frank Walker on February 11, 2014 at 3:33am

BIG

Your respect for traditional American property rights is underwhelming.  Russia and China need you!!

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