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Ohio Utica Shale

Chesapeake under fire for deducting Pa. impact fee from royalties

By Bob Downing Published: October 17, 2013

From the Associated Press:

But a Chesapeake spokesman said the company hasn't deducted the fees from Pennsylvania royalty owners.

Some landowners have unknowingly agreed to such language in recent contracts, the Pittsburgh Post-Gazette ( ) reported.

Lorraine Seiber, a church elder of First United Presbyterian Church of Darlington, said she didn't know the impact fee deduction was part of a recent Chesapeake lease that bears her signature. The church is about 40 miles north of Pittsburgh.

The newspaper said it was unclear if Chesapeake has actually deducted the fees from any royalty payments. Chesapeake spokesman Gordon Pennoyer said the company hadn't done so and believes it is in full compliance with state law.

Patrick Creighton, a spokesman for the industry group the Marcellus Shale Coalition, wrote in an email that "while some leases may contain this language, we are not aware of a single instance whereby a landowner has had these fees deducted from their royalty payments." Creighton said state law takes precedence over lease terms.

Other landowners have agreed to the language, according to a sample of contracts accessed at, a warehouse of scanned oil and gas leases in Pennsylvania and Ohio.

Jackie Root, president of the Pennsylvania chapter of the National Royalty Owners Association, said there's "no question" that royalty owners shouldn't be paying a portion of the impact fee, which was part of the major update to state oil and gas laws passed last year.

The law says that if such a provision is included in a lease that part of the document "shall be null and void." That's true for leases signed before and after the law took effect.

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Ohio Department of Natural Resources' Division of Oil and Gas Resources Management State agency Web site.

ODNR Division of Oil and Gas Resources Management. State drilling permits. List is updated weekly.

ODNR Division of Geological Survey.

Ohio Environmental Protection Agency.

Ohio State University Extension.

Ohio Farm Bureau.

Ohio Oil and Gas Association, a Granville-based group that represents 1,500 Ohio energy-related companies.

Ohio Oil & Gas Energy Education Program.

Energy In Depth, a trade group.

Marcellus and Utica Shale Resource Center by Ohio law firm Bricker & Eckler.

Utica Shale, a compilation of Utica shale activities.

Landman Report Card, a site that looks at companies involved in gas and oil leases.FracFocus, a compilation of chemicals used in fracking individual wells as reported voluntarily by some drillers.

Chesapeake Energy Corp,the Oklahoma-based firm is the No. 1 driller in Ohio.

Rig Count Interactive Map by Baker Hughes, an energy services company.

Shale Sheet Fracking, a Youngstown Vindicator blog.

National Geographic's The Great Shale Rush.

The Ohio Environmental Council, a statewide eco-group based in Columbus.

Buckeye Forest Council.

Earthjustice, a national eco-group.

Stop Fracking Ohio.

People's Oil and Gas Collaborative-Ohio, a grass-roots group in Northeast Ohio.

Concerned Citizens of Medina County, a grass-roots group.

No Frack Ohio, a Columbus-based grass-roots group.

Fracking: Gas Drilling's Environmental Threat by ProPublica, an online journalism site.

Penn State Marcellus Center.

Pipeline, blog from Pittsburgh Post-Gazette on Marcellus shale drilling.

Allegheny Front, environmental public radio for Western Pennsylvania.