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Ohio Utica Shale

Judge backs Chesapeake Energy in lease-breaking lawsuit

By Bob Downing Published: December 14, 2012

From the Marcellus Drilling News:

A lawsuit filed by 95 landowners in Carroll and Columbiana counties (Ohio) has been decided in favor of Chesapeake Energy and against the landowners.

Last month, Judge Richard Markus (Common Pleas Court) issued his decision that the landowners in the case could not break their lease if they received a better offer—something they thought they could do according to a provision in the lease.

Here’s the details of the case and the decision:

 

The Carroll County Common Pleas Court opinion was delivered in November by Visiting Judge Richard M. Markus who was assigned to the cases. The lawsuits were filed in February by Chesapeake Exploration against the landowners and the landowners filed their own lawsuits that same month.

The leases were originally signed with Anschutz Exploration in 2008 and sold to Chesapeake in 2010.

The landowners contended they could terminate the leases with Chesapeake if they received a better offer and Chesapeake did not match the offer. The claim comes from one paragraph in the lease agreements that they claim says they can break the lease if another deal is offered.

According to the original lawsuit, the landowners felt deprived of the “fair value right” of their land. This means that within one year from the expiration or cancellation of the lease, the landowners should have been able to obtain a third-party offer to lease the land.

The landowners contend that this “fair value right” means that they should be able to obtain the signing bonus payments and royalty percentages that other landowners are getting in Columbiana County.

However, Judge Markus did not agree with the landowners’ interpretation of the language, and denied the motion for a summary judgment.*

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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.

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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.