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Utica Shale Development Experience: Landowner and Producer Share Their Story

Posted By Mike Chadsey, Director of Public Relations, Monday, December 12, 2016
Updated: Tuesday, December 13, 2016

A few weeks back, I traveled down to White Sulphur Springs, West Virginia to attend the National Association of Royalty Owners (NARO) Appalachian Chapter, 6th annual member conference. In attendance were people from Ohio, West Virginia, Kentucky and North Carolina. During the social functions between speakers, I was able to meet many great landowners and heard some wonderful stories on what shale development has done for their families and small businesses.

One such story was presented at the conference jointly by mineral owner Alan Walter, and producer Manny Johnson. Together they presented a story on how a landowner and operator work together to produce shale gas from eastern Ohio.

Walter purchased a 150-acre tree farm in Harrison County in 1990. He bought it from a family who had owned it since the 1940s. He shared that the property had lots of issues with overgrowth of both vines and weeds. The problem took him 20 years and over $20,000 to control and finally resolve. To say that Walter was invested in his property is an understatement. During his weekly travels around the farm he found a used cable system, a few tanks, a damaged pump jack, and even 21 oils wells from the 1900s. There was such history with all of this equipment that it took him a while to dig into the records to get a proper account of the activity on his land. Jumping forward into the shale revolution, he watched as the processing plant in Scio was constructed. He recalled wondering if all of the activity would mean a new well on the farm. The answer to that question came in 2014. He was approached with a lease in April of 2011 with not much follow up action. He was contacted again in January 2014 and negotiated details through July 2014. Construction began in August 2014 and oil and gas production began in August 2015.

As Walter described the process from start-to-finish, one of the most important themes he expressed was, “stay in communication with your producer.” As he begin to lay out the details of the well pad on the property, he showed photos of a 20-foot wide, 3,000-foot long lease road where many trees were removed, and even to this day that was a hard decision for Walter to make. Now, he shared, “it’s a great road to use for my next tree harvest.” In addition over 66,000 yards of dirt was moved. The other thing he did not expect was 20 people working daily on his land (on average). After a few days he got to know the people doing work and admits he asked them questions almost every day. In total 19 acres of trees were cleared. Mr. Walter said through the entire process he had a very good experience. He was impressed by what he called an “incredible” environmental protection feel, and that the operator was going above and beyond for drainage. He said that everyone was nice and great to deal with. He concluded his remarks by suggesting that mineral/landowners have a consistent message to the operator, keep good notes, and give written questions when available. He also said don’t be surprised at the size of the equipment or the speed of the operation.

Next up was Manny Johnson:

Manny Johnson has worked in the oil patch for the last decade. First he was a production superintendent at Chesapeake and is currently an operations manager for Huntley and Huntley Energy. This story is from his time at Chesapeake. He started off his comments by saying he really enjoys working with landowners and that, “they are our partners and we truly see them as that.” He sees a harmony of an eight well pad in the middle of a tree farm—and living in St. Clairsville, it is all about maintaining relationships and the landowners are a big part. One of the key reasons his employer liked the Walter farm is that it is located in the wet gas area of the Utica play and his farm is so very close to the Scio plant. He shared that a lot of mineral owners in Ohio have wells and pipelines, but few are so close to a processing plant. One of the key points that he and his crews talk to landowners about is the building of the pad. He stopped there for just a moment to pay special attention and note that every pad has to be engineered and designed, and that he takes lot of environmental considerations into the pad location.

One story he told was when he talked with Walter about how they are using a closed loop system to limit emissions, which is something that was very important to Walter and his farm. He went on to explain that he instructs his crew and mineral owners to get to know each other and stay involved from start to finish of the entire project.

He also emphasized the importance to take spacing on the well pad into consideration, and having the ability to shut down the well remotely if needed. Johnson described how the company has a, “’stop work’ program in place. It is about getting everyone home safe at the end of the day, we spend a lot of time on preventative maintenance. That means we have to keep this well in compliance. To do so, we have weekly, monthly, quarterly, and yearly reports in Ohio to regulatory agencies.”

He ended his public comments by addressing the landowners in the room by saying, “as landowners you are encouraged to ask questions—ask to take a tour and communicate as you need to, don’t let something fester.” Lastly, he closed by saying, “as your partners we want to get out front of issues.” The company has a vested interest in the family on the land the lease, and they hope the landowners take a vested interest in the well, so that everyone will benefit.

This is just one of the many great shared success stories from the Utica. Our special thanks for NARO for the invite to attend its event and to Manny Johnson and Alan Walter for sharing their story.  

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