ROOTSTOWN TWP.:
William Sledzik, the group's president, said most members favor leasing their 193 acres for drilling — if they feel confident the environment will be protected and if they can get a good price.
Kenyon Energy LLC of Oklahoma initially offered Sledzik's group a five-year lease with a one-time payment of $150 per acre. In a separate agreement, the homeowners also would get the standard 121/2 percent royalty on any gas produced.
Ten days later, Kenyon, saying it was representing Chesapeake Energy of Oklahoma, came back with a new offer: $300 per acre, plus the royalty.
Longtime farmer Carl Rufener, 72, of Suffield Township, has received lease offers from three natural gas companies in the past few weeks.
''I'm willing to listen to them,'' Rufener said. His attorney is reviewing a possible lease that calls for a one-time bonus of $450 an acre, he said.
Most of his neighbors with large tracts are also getting similar lease pitches from drillers.
''They're out here working pretty hard,'' Rufener said of the lease crews.
Welcome to Ohio, where a natural gas boom is under way in counties east of Interstate 77.
A blackish, natural gas-holding rock called Marcellus shale that lies thousands of feet below the surface is fueling a land rush.
As many as eight natural gas companies have aggressively gone after mineral rights leases in Portage, Stark, Tuscarawas, Carroll and Mahoning counties this summer, officials said.
Akron has gotten three offers to drill on city-owned watershed land in northern Portage County. Residents of northern Stark County tell of offers to assemble acreage for drilling on the border of Lake and Plain townships.
5,000 feet below
The Marcellus shale boom began in Pennsylvania in 2008 and is spreading into Ohio.
Marcellus shale is found under 54,000 square miles in eastern Ohio, Pennsylvania, New York, West Virginia and western Maryland. It is 5,000 feet below the surface in Ohio and deeper in other states.
That five-state area conservatively contains 168 trillion cubic feet of natural gas in the shale, and the total could be as high as 516 trillion cubic feet, according to Penn State geology professor Terry Engelder and State University of New York-Fredonia professor Gary Lash.
The United States, Canada and Mexico together annually use about 30 trillion cubic feet of natural gas.
If 50 trillion cubic feet can be recovered from the Marcellus shale, it would be enough to fuel the United States for two years and would be worth $1 trillion, Engelder said.
Higher natural gas prices and improvements in drilling techniques made it possible to economically drill down to the Marcellus shale.
Natural gas provides 22 percent of America's energy and some tout it as a cleaner fuel than coal.
Ohio ranks No. 6 for natural gas wells with 34,000 and annually produces 88 billion cubic feet of natural gas, according to state records.
The state has even-deeper natural gas that could be more lucrative. That is the Utica shale at 8,000 feet that could match or surpass Marcellus shale, said Engelder and Rick Simmers of the Ohio Department of Natural Resources' Division of Mineral Resources Management.
That shale lies under the eastern half of Ohio and would be a bigger area to drill than the Marcellus shale — and could be a future energy asset, they said.
In fact, some of the drillers going after land in Northeast Ohio could be eyeing the deeper natural gas, Engelder said.
Controversy arises
However, tapping into the Marcellus shale has turned into a contentious environmental and political battle, particularly in Pennsylvania and New York, with many claiming the drilling technique is unsafe and threatens drinking water.
Companies start out drilling vertically, then shift to a horizontal cut when they reach a desired rock formation. The path can continue horizontally for a mile or more through the Marcellus shale.
Hardened steel bullets then are fired into the tight underground rock to create holes up to 1 foot deep at intervals along the horizontal section.
Extraction then requires injecting large volumes of fresh water and sand into the rocks, fracturing them and freeing the gas in a process called hydraulic fracturing (nicknamed fracking or fracing) and giving the entire process its name.
The pressurized water and sand keep the fractures open. Small amounts of toxic chemicals — from mineral spirits and even diesel fuel — have been added to the water and sand to make it easier to extract more gas.
Some of the water used in the process — from one-third to one-half — returns from the bottom of the well as a briny, chemical- and metal-laden brew. It usually is stored in open pits until it is trucked to treatment plants or underground injection wells.
The industry says hydraulic fracturing — developed in Texas and Louisiana — has been used safely since the late 1940s and 90 percent of today's wells require the technique.
Drilling experts say that because the fracing generally occurs 5,000 feet or deeper, it is very unlikely it contributes to cases of contaminated groundwater near the surface. The fracing area is separated from the groundwater by thousands of feet and numerous geologic formations of rocks and clay.
There have been cases of improperly constructed wells, sloppy operations and drilling through shallow layers of methane that have contaminated drinking water.
Drilling opponents cite 1,000 cases across the country of drinking water being contaminated. That includes a highly publicized case in 2008 in Geauga County's Bainbridge Township, where methane from a natural gas well got into a house and exploded.
The state traced the problem to an improperly constructed well, although the explosion remains under investigation by the U.S. Environmental Protection Agency.
Ohio has no record of hydraulic fracturing contaminating drinking water.
The federal EPA, however, is taking a closer look at fracing. It is holding public hearings on how it should conduct a $1.9 million study of hydraulic fracturing and its effects on groundwater.
Three such hearings have been held: in Canonsburg, Pa.; Denver; and Fort Worth; and a fourth in Syracuse, N.Y., is being rescheduled.
The EPA plans to complete the study's design by September, begin the study in January and have initial results by late 2012.
The Northeast Ohio Gas Accountability Project wants to see the fracing material tracked all the way through the process, something that doesn't happen now, said spokeswoman Vanessa Pesec of Concord Township in Lake County.
Her 1,000-member grass-roots group also wants drilling restricted in high-density urban areas and wants drillers to do more to test and clean up contaminated sludge pits at each site.
Her group strongly urges landowners to confer with an attorney before signing a Marcellus shale lease.
Pesec said two helpful Web sites for landowners are: http://www.neogap.org and http://www.landmanreportcard.com.
Thinner shale
Whatever happens in Ohio with Marcellus shale is unlikely to match what's happening in Pennsylvania, said Thomas Stewart of the 1,500-member Ohio Oil & Gas Association. That's because the shale is thicker and more productive there, he said.
In Pennsylvania, 2,500 drilling permits were issued in 2008-09, and another 5,000 permits are expected this year. To date, about 1,600 wells have been drilled into the Marcellus shale.
What is likely to happen in Ohio ''will be less interesting [than in Pennsylvania] but not uninteresting,'' Engelder said in a telephone interview.
He suggested that drillers might be interested in Ohio's Marcellus shale for its natural gas, plus what is called ''wet gas,'' or highly desirable propane, butane and ethanes.
Those substances are more likely to be found in Ohio than in other Marcellus shale states, he said.
Drillers' interest in Ohio also came after New York state proposed a one-year moratorium on drilling there until environmental effects are assessed. That moratorium is not final, but no horizontal wells have been drilled into the Marcellus shale in New York.
The mood in Pennsylvania also is changing for drillers. The state is talking about imposing a tax on natural gas extraction and toughening drilling rules.
Nonetheless, the debate has not stopped the land rush into eastern Ohio, where companies are working hard to negotiate leases for mineral rights.
Teams of what are called ''landmen'' are searching local land records in county recorders' offices to determine what land they want and who owns the mineral rights.
Few leases have been finalized and filed, officials in the local counties said, but the landmen are making contacts and starting negotiations.
Columbiana County, where the boom began a little earlier, had 208 mineral rights leases filed between May 1 and July 31, compared with 18 in the previous three months. Recorder Craig Brown said prices ranged from $300 to $1,500 an acre.
According to reports, landowners in Belmont and Jefferson counties are getting even higher offers: up to $1,600 an acre.
Chesapeake Energy, the No. 1 Marcellus shale producer, refused to confirm or deny its involvement in seeking out Ohio leases.
''Given Chesapeake's market-moving leadership, we are not prepared to confirm any engagement in Ohio or in any other potential new prospect area at this time,'' said Tom Price, senior vice president of corporate development and government relations.
The Beacon Journal contacted other lease-seeking companies, including Kenyon Energy, but none returned phone calls.
To date, 68 Ohio wells to go into the Marcellus shale have been approved, mostly along the Ohio River.
Under state rules, the drilling companies need at least 40 acres for each well. They prefer larger tracts to keep competitors away from potentially high-producing wells.
Water is needed
Water could become ''a big issue'' if shale drilling takes off in Ohio, said Simmers, of the state's Division of Mineral Resource Management.
The typical horizontal Marcellus shale well requires about 3.5 million gallons of fresh water.
That water might come from aquifers plus rivers and lakes. Some of the water withdrawn from the well is reused.
Anyone using more than 100,000 gallons of water a day must register with the Ohio Department of Natural Resources. Withdrawing water from an Ohio lake or stream would also require approval of landowners adjacent to the water source..
Unlike Pennsylvania, Ohio requires that the salty brine material extracted from the well go to injection wells. It is then pumped into rock formations thousands of feet below ground, where it cannot pollute drinking water.
Ohio brine cannot be discharged into streams.
Pennsylvania allows the brine to go into its streams with a federal permit. That has caused high salt levels and environmental problems in some cases.
In fact, Pennsylvania brine could be coming to Ohio in large volumes.
A number of cities, including Warren, Youngstown, Ashtabula, Steubenville and East Liverpool, have expressed interest to the Ohio EPA about taking such waste. The move would provide income for their sewage plants.
The biggest problems with the waste are that it is high in total dissolved solids and contains such toxic heavy metals as sodium chloride, calcium and magnesium, plus naturally occurring radioactive materials from the underground rock.
The Ohio EPA is requiring the sewage plant operators to modify discharge permits, to take only lower-salinity brine and to monitor discharges into streams, spokeswoman Donna Kniss said.
Sewage plants can remove only a small amount of total dissolved solids, but those solids will be diluted by the larger volume in the sewage plants, she said.
Warren, along with Patriot Energy Partners of Lisbon, is proceeding with plans in Trumbull County.
Shipping Pennsylvania's drilling wastes to Ohio raises some concern for Stewart of the Ohio Oil & Gas Association.
If Pennsylvania drillers send their wastes to Ohio's 159 injection wells and sewage plants, will there still be an economical home for Ohio's drilling waste?
Financial windfall
In Portage County, the proposed lease could provide a financial windfall for Sledzik's homeowners' group.
Each member pays an $800 annual assessment that funds operations.
Sledzik said his members want assurances that the association's 100-acre lake will be unharmed. It drains into nearby Lake Hodgson, which is Ravenna's drinking-water supply.
Sledzik, who teaches public relations at Kent State University, has been researching the pros and cons of drilling.
''You don't want to make a mistake on something like this,'' he said. ''It's important to get it right.''
He said he is comfortable with the technology and the safeguards, but not sure if his group is getting the best price.
Rufener said the leasing companies are interested only in about 250 acres of his land that have no existing gas or oil leases.
That excludes about 1,700 acres of Rufener land with leases in Suffield, Randolph and Atwater townships, he said.
He said he has no reservations about the drilling methods being safe.
''The Marcellus shale is big, and everyone wants it,'' he said. ''We're just sitting on top of it. . . . We hope it's a gold mine.''
Bob Downing can be reached at 330-996-3745 or bdowning@thebeaconjournal.com.
