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Gas companies battle over lease agreements

Deanne Johnson

October 21, 2011
Staff Writer , Morning Journal News

LISBON - Three civil lawsuits, which were either filed or transferred to Columbiana County Common Pleas Court this week, deal with gas drilling leases.

With companies lining up to become involved in deep-level gas drilling and fracking projects and obtaining gas leases for properties, questions about older signed leases have led to an increase in lawsuits at the county Court House.

In one case, Summitcrest Inc. of Acker Road, Summitville, is suing Eric Petroleum Corp., Ohio Buckeye Energy and Chesapeake Exploration LLC. Summitcrest has requested the judge order termination of the defendants' rights to a gas drilling lease.

According to the court documents, Eric Petroleum, which leased the property several years ago, subleased it to Ohio Buckeye Energy, which drilled one well at a level which was shallower than the Marcellus Shale level. Ohio Buckeye Energy then stopped drilling for a period of time long enough to nullified any further rights to drill, the plaintiff contends.

In another lawsuit, Ohio Buckeye Energy, Oklahoma City, Okla., is attempting to force another company, Beck Energy Corp., Ravenna, to follow what it claims is the the original agreement between the two.

Court documents list that Beck Energy obtained the lease rights of 27 property owners with a combined 2,600 acres in Hanover and Butler townships. Originally, Beck Energy had asked for a certain amount in payment for the rights to do deep gas drilling per acre and a certain royalty amount for the natural gas. Later, the documents alleged, Beck Energy tripled the asking price per acre.

Ohio Buckeye Energy has asked the judge to rule Beck Energy be held to previous terms of agreement or pay in excess of $25,000 in damages.

In a third lawsuit transferred from Lake County, Chowder Gas Storage Facility LLC in Mentor is suing Ohio Buckeye Energy LLC, along with William E. Blair Jr., Fountain Hills, Ariz.; Ball Resources Inc., Lisbon; Five Star LLC, Honeybrook, Pa.; Richard W. Petticrew, Oklahoma City, Okla.; Jeffrey B. Petticrew, Virginia Beach, Va.; C. Richard Petticrew Oil, Oklahoma City, Okla.; and Bass Energy Inc. of Fairlawn, Ohio.

Chowder Gas Storage Facility claims the defendants agreed to allow the Mentor company to purchase 60 percent of deep-well gas lease rights in two seperate deals, but did not own the rights before selling them. The company now claims the royalties due from deep drilling are being withheld from them.

The company is seeking in excess of $25,000 in damages and for the rights of the companies involved to be specified.

According to the Columbiana County Health Department, there have already been 12 permits sought for gas drilling this year, and six are in various stages of operation. Many more are expected next year.

The health department is also starting to get requests from those in areas near potential drilling sites asking for water quality and flow rate tests. Environmental Director Lori Barnes said there are several levels of testing and different fees for the various tests. A basic test costs $210, while the complete testing for various metals and volatile organic chemicals costs $755.

djohnson@mojonews.com

 
 

 

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