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the most family-friendly and affordable entertainment experiences of the area’s summer season. Holmes County Fair Board, 8381 Ohio 39, Millersburg; www.holmescountyfair.com 13-15 – Lincoln Highway “Buy-Way” Yard Sales: Yard sales stretch all across the state including Wayne County; along the Lincoln Highway. www.historicbyway.com. 14-15 – Orrville Lions Rib & Music Fest: Craft and Car Show, entertainment and great food. Free shuttles from school parking lots. Fri, 5-10 p.m. & Sat, 10 a.m.-11 p.m.; Market Street _ Downtown Orrville; 330-466-0973; www.orrvillelionsclub.com.

12 – Herb Fair: Over 70 artists and craftsmen set up among the gardens of Quailcrest. Fine jewelry, furniture, antiques, clothes, stoneware, creative clay, ironwork, baskets, tole painting, bells, bronze, gourds, dried flowers, herbs, corn, pressed flowers and more; Quailcrest Farm, 2810 Armstrong Rd., Wooster; 10 a.m.-5 p.m.; 330-345-6722; www.quailcrest.com. 12 – Harvest Fest/Rib Cook-Off & Parade: Shopping and ribs, what more can you ask for? Enjoy special sales at participating stores and sample delicious BBQ ribs at various stops throughout downtown Berlin.Vote for your favorite and enjoy the Harvest Fest Parade at the end of the day. Downtown Berlin; 330-893-3192; www.heartofamishcountry.com. 12-17 – 166th Wayne County Fair: “Ohio’s Foremost Agricultural Fair,” the Wayne County Fair is home to favorites such as farm tractor pulls, a demolition derby, country concerts, livestock shows and baking and home economic projects. Wayne

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NOVEMBER: 6-7 – Season’s Splendor Arts & Crafts Show: Juried art and craft show with 115 booths on one floor. Lunch available. Sponsored by the Wayne County Arts and Crafts Guild. Fri, 5-9 p.m. & Sat, 9 a.m.-4 p.m.; Greenbriar Conference & Party Centre; 330345-5962; www.greenbriarwooster.com 7 – NatureFest Arts & Crafts Show: Arts and crafts show depicting nature. Join us for great holiday shopping. continued

4 – Cookbook Extravaganza and Tasting at Gospel Bookstore: Gospel Book Store; 4900 Oak St., Berlin; 330-8932523; www.mygospelbookstore.com 4 – Benefit Quilt Auction: Benefitting the Crippled Children’s Bureau. 9 a.m.; Kidron Auction, 4885 Kidron Rd., Kidron (on the square); 330-857-2641; www.kidronauction.com. 17-18 – Johnny Appleseed Festival: Parade Sat, 3:30 p.m.; vendors, games, entertainment and chicken BBQ. 3:30-11 p.m.; Apple Creek Village Park, 330-698-3571. 31-Aug. 1 – Ohio Mennonite Relief Sale: Huge Quilt and Wood Auction which raises money for world-wide relief through the Mennonite Central Committee. Great food! Celebrating 50 years! Fri, 4 p.m. & Sat, 7 a.m.; Buckeye Event Center, 624 Henry St., Dalton; 330-682-4843; www.ohiomccreliefsale.org.

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2-3 – 63rd Annual Ohio Swiss Festival: Friday & Saturday provide two full days of entertainment and events such as costume and yodeling contests, the Steinstonssen (throwing of the stone), the Swiss Cheese Chase 5K, and a kiddie and grand parade! to Know Sugarcreek; 888-609-7592, www.visitsugarcreek.com. Downtown 2-3 – Woosterfest: Traditional Octoberfest celebration featuring entertainment, food, talent show, arts and crafts, children’s activities, Biergarten, Winegarten, and more! Fri, noon-11 p.m. & Sat, 11 a.m.-11 p.m.; Downtown Wooster; 330-262-5735; www. woosterchamber.com. 9-10 – Enchanted Forest: Bring the entire family to the Enchanted Forest to learn about how creatures of the night survive in the forest.You will walk pumpkin-lit trails led by fireflies and have cider and pretzels after; 6:30 p.m. & 7:30 p.m. shows each evening; The Wilderness Center, 9877 Alabama Ave. Sw., Wilmot; 877-3595235; www.wildernesscenter.org. 9-10 – Charm Days: A two day event held in the Charm full of contests, food, auctions, a flea market, special merchant sales, music and more.Village of Charm; 330-893-2251, www.charmdays.com. 9-10 – Fabulous Fall Garage Sales: Follow the signs and pick up a map at one of the many garage sales going on throughout the community and visit the Swiss Village Corridor for bargains and buys from our friendly retailers. Maps are also available at most businesses. Downtown Sugarcreek, www.villageofsugarcreek.com. 10-11 – Wayne County Farm Foliage Tour: Spend the day in beautiful rural Wayne County on a self-drive tour of area farms and agricultural businesses while enjoying the fall colors. Sat, 11 a.m.-6 p.m. & Sun, 1-6 p.m.; Southwest Wayne County; 330-263-7456; www.wccvb.com or ofbf.org/wayne.

ORGANIC CERTIFICAT

1-2 – Customer Appreciation Sale: Friday, enjoy free cookies land.com andish-heart punch/coffee. Saturday, enjoy free pie and ice cream. 8 a.m.-5 Ohio Visit www.am Dinettes • Computer across Desks centers at AAASets Pick ••upBedroom p.m.; Mt. Eaton Greenhouse, 15172 Harrison Rd., Apple Creek, OH. • Entertainment Centers 9 – Vintage Garden Tractor Show: Vintage garden tractors, • Bookcases • Jewelry Boxes • Lots of Crafts • Rockers & Gliders parts vendors, a dead sled pull, hourly giveaways, a pedal tractor Andy • Curio Cabinets Hostetler We Build Furniture pull for children and more. Also features customized garden • Rolltop Desks Your Way, tractors, lawn equipment, walk behinds, chain saws and toy tractors. All Day! Downtown Sugarcreek, www.sugarcreekbusinessassociation.org. 6018 CR 77 • 330.698.3200 • Next Day Fax • Located across from Heini’s Cheese in Bunker Hill 22 – Sounds of Downtown: Spend a relaxing evening in Downtown Wooster listening to street musicians. 6-8 p.m.; Downtown Wooster; www.mainstreetwooster.com; Additional dates: 7/23, 8/28 & 10/23 23-24 – Great Lakes Fiber Show: Sales booths with fiberrelated supplies and fiber art. Workshop and demonstrations, kids’ activities, Skein Competition, Fleece Show and Sale, Fresh cooked A Unique Experience Every Visit. Offering Antiques, lamb and more! Sat, 10 a.m.-5 p.m. & Sun, 10 a.m.-4 p.m.; Wayne Primitives, and Country Home Decor. County Fairgrounds, 199 Vanover St., Wooster; 330-264-9665; www. greatlakesfibershow.com. 330-893-0150 • 4815 East Main Street, Berlin, OH 44610

1 – Ladies Night Out: Join us for a fun night of activities for women of all ages. 5-8 p.m.; Downtown Wooster; 330-262-6222; www.mainstreetwooster.org. 5-6 – Wooster Music & Rib Fest: Food and live entertainment 1 Sawyer Brown. from Michael Stanley and the Resonators and Wayne County Fairgrounds, 199 Vanover St., Wooster; www. Don’t have time to quilt those tops? We offer Long-Arm Quilting Services! waynecountyfairohio.com. 26 Ice Cream Flavors Daily! We also carry Miele & Riccar Vacuums! 12-13 –&3rd Annual COUNTIES Kidron Days: Check out your favorite SERVING WAYNE HOLMES Kidron businesses for special promotions and join in special 5454 Cleveland Rd. (Rt 3) • Wooster — SALES & SERVICE — 4897 West Main Street • Berlin, OH 44610 (330) 893-2864 holmessewandvac@yahoo.com community events! 330-345-8190 • www.hartzlerfamilydairy.com Hrs: Tue.- Fri. 9:00-5:00 • Sat. 9:00-2:00 • Closed Mon. 14-15 – Quailcrest Farm Spring Garden Fair: Over 40 garden related artists and craftsmen, food and music set in the beautiful Quailcrest Gardens. Quailcrest Farm, 2810 Armstrong Rd., Wooster; 10 a.m.-5 p.m.; 330-345-6722; www.quailcrest.com. 27 – Berlin Art Festival & Pet Day: Artisans display their creations and dog lovers unite. Enjoy a pet parade, pet contests and ON ICATI PUBL HLY much more; 4900 Oak St., Berlin; www.heartofamishcountry.com. www.furnitureheartland.com MBER 2015 • A FREE MONT NOVE 27 – Ales for Trails: Join The Wilderness Center with raising funds for trails and sampling beer and music; The Wilderness Center, 9877 Alabama Ave. Sw., Wilmot; 877-359-5235; www. wildernesscenter.org.

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County Fair Board, 199 Vanover St., Wooster; 330-262-800; www. waynecountyfairohio.com. 19 – Wooster Arts Jazz Fest: Jazz bands play while artisans offer their work at a fine art show. Gourmet food and kids’ activities too! 11 a.m.-7 p.m.; Downtown Wooster; 330-262-6222; www.woosterartsjazzfest.org 19 – World Crafts 25th Anniversary: Sales, giveaways and refreshments; 13110 Emerson Road, Kidron, OH; 330-857-0590; www.worldcraftsfairtrade.com 20-21 – Woodcarving Show: Thousands of woodcarvings and woodcarving demonstrations and raffles. Free. Sat, 9 a.m.-4 p.m. & Sun, 1-4 p.m.; The Wilderness Center, 9877 Alabama Ave. Sw., Wilmot; 877-359-5235; www.wildernesscenter.org.

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18 – Earth Day Celebration: A full day of celebrating the great outdoors! Trail clean-up, workshops, bird walk, and Fotofest. 9 a.m.-4 p.m.; The Wilderness Center, 9877 Alabama Ave. Sw., Wilmot; 877-359-5235; www.wildernesscenter.org. 18-19 – Fotofest: Look at beautiful nature photos and choose your favorites. Sat, 9 a.m.-4 p.m. & Sun, 1-4 p.m.; The Wilderness Center, 9877 Alabama Ave. Sw., Wilmot; 877-359-5235; www. wildernesscenter.org. 25 – Berlin Barnstorming: Participating merchants will hide a small wooden barn somewhere in their store. Most stores will offer discounts on your purchase if you find the barn. Each store will have a drawing along with a huge combined grand prize drawing. Dowtown Berlin; www.heartofamishcountry.com. 25-26 – Native Plant Sale & Gardening Seminars: Join us INSID E... to learn about native plants in your garden. Purchase hard-to-find native plants. Sat, 9 a.m.-4 p.m. & Sun, 1-4 p.m.; The Wilderness Center, 9877 Alabama Ave. Sw., Wilmot; 877-359-5235; www. wildernesscenter.org. What

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9 a.m.-4 p.m.; The Wilderness Center, 9877 Alabama Ave. Sw., Wilmot; 877-359-5235; www.wildernesscenter.org. 7-8 – Quailcrest Christmas Open House with artists in the Greenhouse: Wonderful holiday treats, guest artists, music and a special visit from the Christmas Alpaca’s! Reservations starting in October; Sat, 9a.m.-5 p.m. & Sun, 12-5 p.m.; Quailcrest Farm, 2810 Armstrong Rd., Wooster; 330-345-6722; www.quailcrest.com. 12 – World Crafts Christmas Open House: The only night open late all year! Enjoy giveaways, refreshments and special sales. 9:30-8 p.m.; 13110 Emerson Road, Kidron, OH; 330-857-0590; www. worldcraftsfairtrade.com 13-14 – Berlin Christmas Open House: Celebrate the season early as many shops offer special sales, refreshments, and will be festively decorated; Berlin Main Street Merchants, Downtown Berlin; hours vary; www.heartofamishcoutry.com. 13-15 – Birdseed Sale: All bird feeders and accessories on sale in The Wilderness Center’s Nature Store. Free Backyard Bird Feeding program and more; Fri-Sat, 9 a.m.-4 p.m. & Sun, 1-4 p.m.; The Wilderness Center, 9877 Alabama Ave. Sw., Wilmot; 877-359-5235; www.wildernesscenter.org. 20 – Window Wonderland: Santa comes to Downtown Wooster with activities, live music and holiday fun for all! 7-9:30 p.m.;

Downtown Wooster, 330-262-6222, www.mainstreetwooster.org 27-28 – Christmas in the Village of Downtown Sugarcreek: Sugarcreek comes to life with beautiful tree and light displays and strolling carolers. Enjoy free songbooks, hot chocolate, pastries and gifts, and start your Christmas shopping\our stores will keep the doors open for you. Downtown Sugarcreek, www. villageofsugarcreek.com. 28 – Christmas In Berlin and Nativity Parade: Celebrate the season in Berlin. Candle-lighting ceremony, nativity parade, luminaries and refreshments. Nativity Parade begins at 5:45 p.m.; Main St., Downtown Berlin; 330-893-3192; www.heartofamishcountry.com.

DECEMBER

4 – Downtown Churches Walking Tour: Free walking tour of downtown churches highlighting their history, architecture and music. 6-8 p.m.; Downtown Wooster; 330-262-6222; www. mainstreetwooster.org 11 – Shopping Under the Stars: Enjoy holiday shopping at its best, come to Berlin and enjoy extended hours in many of Berlin’s shops. Many stores will offer sales, refreshments, raffles, and hours from 5-9 p.m.; www.heartofamishcountry.com. 12-13 – Christmas Cookie Tour of Inns: Tour the Inns of Amish country while sampling featured cookies at each location; 330-6743975; www.christmascookietour.com

2/24/14 11:12 AM

Gas & Oil • Amish Heartland Map • Now & Then • Hidden Treasures Want to expand your marketing portfolio? Call 330-264-1125 Spectrum is a division of Dix Communications and The Daily Record


Ohio Supreme Court

To Hear Arguments Over Leases

T

he Ohio Supreme Court is ready to hear arguments in a long-running legal battle over disputed oil-andgas leases held by 700 landowners in southern and eastern Ohio.

A pair of cases involving Beck Energy Corp. leases has been consolidated. Arguments are scheduled for Tuesday. A trial court voided leases for five Monroe County landowners who argued Beck wrote contract language that allowed the company to sit on the land indefinitely without drilling. Landowners were also allowed to declare class action status to void leases for additional landowners. A second lawsuit was filed challenging a freeze the court put on the leases, which landowners argued kept them from signing subsequent lucrative deals. Beck’s side says they need more time, because the class action has made drilling since 2012 too risky.

See related story on Page 28

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Table of Contents JANUARY 2016

1

Ohio Supreme Court To Hear Arguments Over Leases

5

Gulfport Donates $500,000 To Foundation For Appalachian Ohio

6

Multiple Pipelines Present Multiple Considerations

8

Presidential Contenders Differ Sharply On Climate, Energy

10

2

Latta Votes To Protect Affordable, Reliable American Energy

11

Columbia Gas Of Ohio Donates To Foundation For Appalachian Ohio’s Legacy Fund

12

H.R. 8, The North American Energy Security & Infrastructure Act

13

The Future Of Shale

14

Kent State Students Visit Oilfield Sites

16

AP Fact Check: Candidates & Climate Change

18

Firefighters Trained To Respond To Oilfield Incidents

20

Nexus Gas Transmission Project Moves Forward

OhioGas&Oil

PUBLISHERS Andrew S. Dix ASDix@dixcom.com G.C. Dix II GCDixII@dixcom.com David Dix DEDix@dixcom.com

EXECUTIVE EDITORS Ray Booth RBooth@dixcom.com Roger DiPaolo RDipaolo@dixcom.com Rob Todor RTodor@dixcom.com Lance White LWhite@dixcom.com

RE G IO NAL E DIT O RS Judie Perkowski JPerkowski@dixcom.com Erica Peterson EPeterson@dixcom.com Cathryn Stanley CStanley@dixcom.com Niki Wolfe NWolfe@dixcom.com

GasandOilMag.com


Table of Contents JANUARY 2016

22

Energy Industry Forms Alliance To Fight Utility Ballots

23

Oil, Natural Gas Wells Reach New Highs In 3rd Quarter

24

Opportunities For Asset Protection Oil & Gas Interests You May Be Missing: The Ohio Legacy Trust Act

26

Reader Polls: Biggest Stories About The Gas & Oil Industry In 2015

Jeff Pezzano VP Advertising Sales & Marketing Kent, Ohio Office JPezzano@dixcom.com 330-541-9455

27

Financial Woes Confront Firm Behind New England Gas Pipeline

28

Supreme Court Hears Cases Involving Leases In Monroe County

Diane K Ringer Kent, Ohio Office DRinger@recordpub.com 330-298-2002

30

Average Gas Price Soon Under $2, Lowest Since Recession

ADVER TISING Kim Brenning Cambridge, Ohio Office KBrenning@dixcom.com 740-439-3531 Kelly Gearhart Wooster & Holmes, Ohio Offices KGearhart@the-daily-record.com 330-287-1653 Jeff Kaplan Alliance & Minerva, Ohio Offices JKaplan@the-review.com 330-821-1200 Mark Kraker Ashland, Ohio Office MKraker@times-gazette.com 419-281-0581

Janice Wyatt National Major Accounts Sales Manager JWyatt@dixcom.com 330-541-9450

31

County Preparing Now For Planned Cracker Plant

DIGITAL MEDIA MANAGER

32

Study Predicts Considerable Industry Growth In Ohio

Brad Tansey BTansey@dixcom.com

L AYOUT D E SIG NE R Luke West

lwest@the-daily-record.com

GasandOilMag.com

Getting The Lowdown Down Low

Jan 2016 • A Free Monthly Publication

New 2016 Design

Local College Students Tour a Drill Site

Study Shows Still Plenty of Potential

“Gas & Oil” is a monthly publication jointly produced by Dix Communications. Copyright 2016. GasandOilMag.com

IN THIS ISSUE: A LOOK AT THE HR 8 ENERGY

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On The Cover: Kent State Students Visit Drilling Sites OhioGas&Oil

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Gulfport Donates $500,000 to

Foundation for Appalachian Ohio

I

Judie Perkowski • Dix Communications t is not unusual for Mike Moore, president and CEO of Gulfport Energy Corporation, to be in Ohio, even though his company’s headquarters is in Oklahoma City. Gulfport migrated to Guernsey County in 2010 and drilled its first well in the state in 2012. And it’s not unusual for Moore to be in Guernsey County, one of four Ohio counties — in addition to Belmont, Harrison and Monroe — that have benefited from the Gulfport Energy Fund, the company’s humanitarian arm, which serves Ohio counties where Gulfport operates. What is unusual is Moore’s announcement of a $500,000 gift from Gulfport Energy to the Foundation for Appalachian Ohio. Moore stated the generous contribution will build on the company’s partnership with the FAO. And because of the additional investment in the Fund, Gulfport is expanding its service area to include Noble and Jefferson counties, where nonprofits are also invited to apply for Gulfport Energy Fund grants throughout the year.

Gulfport Energy Corporation President and CEO Mike Moore, presents a check for $500,000 to Foundation for Appalachian Ohio President and CEO Cara Dingus Brook Monday evening at the Salt Fork Lodge and Conference Center. The halfmillion dollar gift was the second Gulfport has made to the Foundation since 2014. As a result of Gulfport’s generosity, Moore has presented a total of $400,000 in grants to schools and tax exempt organizations in the past two years.

“We established the Gulfport Energy Fund at the Foundation for Appalachian Ohio to support our strong commitment to the communities where we operate,” said Moore. “We have witnessed the passion and hard-working spirit of the people making a difference in each community. We are pleased to increase our investment in Appalachian Ohio with this gift to further encourage and support the region.

The event was at the picturesque Salt Fork Lodge and Conference “This is only the beginning, there is so much more to do. We are Center Monday evening. Moore was joined by FAO President here to stay, and thank you for making Ohio our home.” and CEO Cara Dingus Brook, as well as Gulfport employees and Though the Gulfport Energy Fund is specifically designed to elected and community officials. serve the communities where it operates, Gulfport has also made Brook said the gift was “unparalleled,” and the first gas and oil a significant investment in the broader Appalachian region. Of its half-million dollar gift, $192,000 of it will be invested in the company to invest in the Foundation. FAO. The $500,000 brings the total to nearly $1 million Gulfport “We are so grateful for Gulfport’s unwavering commitment to Energy has contributed to the FAO. the local communities where Gulfport operates,” said Brook. “Gulfport’s gift is especially significant given the current Moore’s plan materialized initially in May of 2014, when it was economic conditions in the energy sector. It is transformative, announced at Gulfport’s regional office in St. Clairsville that the and will make a huge difference, not only today but for company was partnering with the Foundation for Appalachia generations to come. We could not be more excited or Ohio to create the Gulfport Energy Fund, to support local leaders in schools, nonprofits and other tax-exempt community appreciative.” organizations. Its first philanthropic effort in Ohio was a $400,000 The announcement was followed by dinner and presentations gift to the FAO. by four of the Fund’s grant recipients: Bob Burdge of the Cadiz Lions Club, Michelle Johnston, teacher at Cambridge Middle The Gulfport Energy Fund is part of the Guernsey County School, Janie Downerd and Kylee Quinn of the Guernsey County Foundation’s Family of Funds, created in collaboration with the Senior Citizens Center, and Elizabeth Turner, teacher at River Foundation for Appalachian Ohio. Elementary School in the Switzerland of Ohio School District. For more information about the Gulfport Energy Fund, visit the Foundation’s webiste at www.AppalachianOhio.org/Gulfport.

GasandOilMag.com

OhioGas&Oil

5


Multiple Pipelines Present

Multiple Considerations Steven Huszai • Dix Communications

A

s property owners across the state grapple with ways to best manage agreements with multiple pipelines traversing Ohio, the city of Wooster was recently presented a request for an easement for the Utopia project. 

Road, land which was gifted to the city (via Wooster Growth) in 2006 by the steel company. Kinder Morgan sent Wooster Growth a request for permanent and temporary work space easements on two separate parcels, plus contingencies for crop loss and non-crop loss damages to the tune of $33,260 in a one-time payment. 

But this request of the city is different in multiple ways and has ramifications beyond other easements, as the Utopia Breneman, who has been in the industry for 35 years and still project could potentially affect Wooster’s water quality for operates his own wells in Wayne, Holmes and Coschocton counties, said there are differences between the Utopia and 26,000 residents and its ability to attract new businesses.  ET Rover pipelines, both of which are coming through Wayne And, whereas other individuals and entities may be in the County in the next few years.  dark on the ins and outs of the oil and gas industry, Wooster’s While not taking a stance on either project, Breneman said mayor has been in it for 30 years.  ET Rover will transport natural gas through the area. The “You’re getting into my wheelhouse here,” said Mayor Bob pipeline will include two 42-inch lines at 1,440 lbs. of pressure Breneman, who is also president of Ponderosa Consulting through the area and is governed by the Federal Energy Services, during a meeting of the city’s community Regulatory Commission.  improvement corporation on Oct. 29. “I have a real problem But the Utopia pipeline project will include two 12-inch with this.” lines carrying ethane and natural gasoline, or “drip gas,” as At the monthly meeting of the Wooster Growth Corporation, Breneman said it is called in the business, in liquid form. The the economic development arm of the city, finance director Utopia project will also be governed by the Ohio Department Andrei Dordea presented the group with a request from of Transportation.  Kinder Morgan Cochin, which is seeking to develop the Information sheets from Kinder Morgan note the pipeline Utopia pipeline.  is seeking to transport drip gas from Harrison County to Maps of the proposed pipeline route showed it running Windsor, Ontario through the state in the Utopia East project. through the former Timken Steel property along Prairie Lane Initially, it will seek to transport 50,000 barrels per day, with

6

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the ability to reach a 75,000 barrel per day capacity in the future. Kinder Morgan is looking to begin construction of the pipeline in November 2016 with operations beginning in 2018. The mayor said numerous factors play into his opposition to this request.  “I guess my biggest worry from the Based on what he knows, the mayor is city’s perspective is safety,” Breneman hoping Kinder Morgan can push its planned route further south. But he said at the Oct. 29 meeting.  admitted there have not been any real The mayor noted should there be an negotiations to date.  issue with the ET Rover pipes, natural gas will rise; but the Utopia “drip gas” A sub-committee was established at the product will go down and be hard to Wooster Growth meeting consisting of clean up, despite emergency protocols the mayor, along with city Law Director Richard Benson and Wooster attorney in place.  Bob Reynolds, to continue to monitor But this leads to the biggest problem with the pipeline project and find a working the Utopia lines, as its current proposed solution.  route runs through the Timken property who has experience is a part of the Killbuck Valley Buried Reynolds, Aquifier, and is adjacent to the city’s negotiating leases with entities bringing pipelines through the county, said south well field.  individual property owners typically Breneman this land is valuable to the are concerned with weighing their city as it continues to grow both in financial compensation against plans to potentially develop the land.  population and seek out industry.  He said the city is primed to take on additional heavy water users and its population would need to double, before looking at tapping another well.  The mayor also said, while he is familiar with FERC regulations, he is unsure of ODOT’s regulatory procedures regarding pipelines serving the oil and gas industry.  FERC, for instance, requires pipeline projects to hold public meetings on the proposals and the Rover project has held several meetings in Wayne County on its plans. As far as Breneman can tell there are no public hearings scheduled on the Utopia project. Kinder Morgan first contacted the city on its plans in February via mail; the mayor said city officials then met with them in May.

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Wooster bills roughly 70 million gallons of water per year. LuK is the second largest water consumer in the city at 17.7 million gallons through September; WCH is the fourth at 10.2 million gallons. The OARDC is the largest water customer at 24.2 million through the end of September. Other top water users are Frio-Lay, the Melrose Mobile Home Park, the College of Wooster, the city’s sewer plant, and the Bell Store on West Milltown Road.  And based on Daisy’s estimates when it reaches full capacity, it could exceed the OARDC’s water usage. 

The mayor explained that the area to the south of the municipal water plant, where the south well field is located, is prime real estate due to its geological “For a lot of landowners it’s a financial makeup. decision,” Reynolds said. But with the city, price won’t play a role due to the The south well field is comprised of a larger issue of protecting Wooster’s gravel pack, in some areas hundreds water source.  of feet thick, and serves as a “perfect reservoir” for fresh water. This stretch The ability to provide water — besides the of land south to the Killbuck Marsh obvious reasons of human consumption Wildlife Area is a rich resource for the and modern residential needs — is also county and allows for an extremely fast a chief concern for economic growth of “recharge” of the water underground communities.  when the city pulls from its three current wells. For instance, the city’s ability to land a commitment from Daisy Brand to build And the mayor noted should another a new manufacturing plant along Geyers well be required, it would be in this Chapel Road hinged on the city’s ability property.  to provide 1 million of water per day. Other heavy water users, such as LuK “We should never worry for centuries,” and the Wooster Community Hospital, the mayor said, of the city’s demand for are also able to continue growing due to freshwater. “As long as we don’t pollute the city’s ability to provide water.  it... (and if drip gas) got into it and contaminated that resource, it would be very hard to clean up.”

OhioGas&Oil

7


Presidential Contenders Differ Sharply

On Climate, Energy

D

Matthew Daly • Associated Press e m o c r a t i c CLIMATE CHANGE p r e s i d e n t i a l Obama heads to Paris on Sunday for an candidate Bernie international climate conference, and Sanders calls Republicans are united in opposition to climate change the greatest a possible pact and the president’s plan threat to national security. Front-runner to cut greenhouse gas emissions from Hillary Rodham Clinton promises U.S. power plants. to install more than 500 million solar panels across the country. Texas Sen. Ted Cruz and GOP presidential front-runner Donald On the Republican side, Jeb Bush would Trump are among several Republican phase out tax credits for solar power. candidates who reject mainstream Rival Marco Rubio wants to cut the climate science. Ben Carson calls himself federal gas tax by 80 percent. a “climate science questioner” and says “the temperature of the earth is always They’re among the stark differences fluctuating.” between the two parties on energy and environment issues that underscore the Bush said at a New Hampshire town hall sky-high stakes for both sides of the last month that he thinks the climate is debate in the 2016 presidential race. changing and that “humans have some say in it for sure.” But, he added, “What I After President Barack Obama’s two don’t want to do is destroy the American terms, business and environmental economy as the solution.” groups see a game-changing election. Many environmental groups and Rubio asserted at a recent GOP debate Democrats fear a potential rollback of that “America is not a planet” and said the Obama administration’s policies on that when it comes to global warming, he climate change and renewable energy was “not going to destroy our economy under a Republican president. Business the way the left-wing government we groups and Republicans are eager to are under now wants to do.” boost oil and gas production following years of frustration with Obama. Republican candidates all warn that Obama’s plan to curb greenhouse gas “At the end of the day, there’s a clear emission from U.S power plants could choice for all” of the candidates, said cost thousands of jobs and raise electricity Tom Pyle of the pro-business American costs for businesses and families. Energy Alliance. “Either continue the Obama administration’s anti-energy Clinton, Sanders and fellow Democrat agenda or chart a new course that Martin O’Malley support the president’s promotes affordable and reliable energy Clean Power Plan, calling it a legacyfor all Americans.” worthy effort to slow climate change.

recently rejected by Obama. Democrats support the president’s action. Republicans also agree on lifting the 40-year-old U.S. ban on crude oil exports; Democrats are opposed.

Some of the issues dividing the OIL & GAS DRILLING candidates in the presidential election: Republican candidates all say they would approve the Keystone XL oil pipeline

8

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Sanders wants to stop all new oil and gas drilling on federal lands, as well as in the Arctic and Atlantic oceans, while Republicans would expand drilling for oil and natural gas. Like Sanders, Clinton opposes drilling in the fragile Arctic region, which she calls “a unique treasure.” But she generally supports drilling on federal lands. RENEWABLES Democrats back federal subsidies for renewable energy such as wind and solar power. On the GOP side, the candidates range from skeptical to hostile about a policy several describe as Washington “picking winners and losers.” Trump has long opposed wind power. He famously objected to a proposed wind farm near a golf course he was building in Scotland. But as a presidential candidate, his views have evolved. At a recent event in Iowa, one of the nation’s top wind-farm states, Trump offered grudging support for a federal tax credit for wind energy. While calling wind turbines “very, very expensive” to build and maintain, Trump said he is “OK” with subsidies.

New Jersey Gov. Chris Christie backs credits for wind energy and supports a federal Renewable Fuel Standard that mandates ethanol in gasoline, a policy Cruz has denounced as “corporate welfare.” Trump also supports the corn-ethanol mandate, which is hugely popular in early-voting Iowa. Rubio, Bush and Ohio Gov. John Kasich say it should be phased out over time. Democrats back the ethanol mandate as well as incentives for biofuels. COAL AND NUCLEAR After running as a champion of coal in 2008, Clinton now calls for protecting health benefits for coal miners and their families and helping retrain them for new jobs. She would use a combination of tax incentives and government grants to help coal-dependent communities repurpose old mine sites and attract new economic investment. Republicans all support coal production and enthusiastically back nuclear energy; Clinton offers cautious support for nuclear power. Sanders has called for a moratorium on nuclear-plant license renewals and cheered the closure of the aging Vermont Yankee nuclear plant.

“I don’t think they work without subsidy, which is a problem,” he said.

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Latta Votes to Protect Affordable,

Reliable American Energy

C

ongresman Bob Latta (R-Bowling Green) released the following statement regarding the U.S. House of Representative’s passage of S.J. Res 23 and S.J. Res 24. The resolutions disapprove the two final rules issued by the Environmental Protection Agency (EPA) for new and existing power plants:

Introduced under the Congressional Review Act, the resolutions dictate the EPA may not issue the same or a substantially similar rule unless authorized by subsequent legislation. Rep. Latta was a cosponsor of the House companion resolutions.

“There is a reason over half of the nation’s states have sued the EPA to block this rule. The Clean Power Plan – a rebranding of the President’s rejected “cap and trade” legislation – will cost hard working American men and women energy jobs, and will increase electricity bills for Americans of all ages. I supported these resolutions in order to protect jobs, ensure the reliability of our electrical grid, and safeguard Americans from incurring burdensome costs as a result of this Administration’s regulatory overreach.”

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Columbia Gas of Ohio Donates to

Foundation for Appalachian Ohio’s Legacy Fund

C

olumbia Gas of Ohio announced a $25,000 contribution to the Dale Hileman Legacy Fund at the Foundation for Appalachian Ohio (FAO) during the Eastern Ohio Development Alliance’s (EODA) Nov. 13 board meeting. The contribution recognized Mr. Hileman’s 40-year career with Columbia Gas of Ohio in Carrolton, Jackson, and, finally, Cambridge. Upon his retirement from Columbia Gas of Ohio, Mr. Hileman and his wife, Evelyn, remained in Cambridge where Mr. Hileman co-founded EODA with Dr. Sam Speck and later served the organization as its executive director. “By making this contribution, we celebrate Dale’s passionate commitment to eastern Ohio and his 40 years of service to our company,” said Dan Creekmur, president of Columbia Gas of Ohio. “We share Dale’s commitment to this region, and we’re excited that the Dale Hileman Legacy Fund will carry on his work.”

economic development, education, environmental stewardship, and health and human services. Gifts to the Dale Hileman Legacy Fund are tax deductible and can be made in many ways, including cash, bequests, and life insurance. To mail your donation, please designate the Dale Hileman Legacy Fund and mail to the Foundation for Appalachian Ohio, PO Box 456, Nelsonville, OH 45764. Gifts can also be made online at www.AppalachianOhio.org by selecting the Dale Hileman Legacy Fund when donating. For more information about the Foundation for Appalachian Ohio and ways you can honor the legacy of others making a difference in our region, please visit www.AppalachianOhio.org or call 740.753.1111.

The $25,000 contribution will help the Dale Hileman Legacy Fund promote the same cause Mr. Hileman championed throughout his life, economic development and growth. The Dale Hileman Legacy Fund will support organizations working to promote economic growth within the 16 counties served by EODA, comprising Athens, Belmont, Carroll, Columbiana, Coshocton, Guernsey, Harrison, Holmes, Jefferson, Monroe, Morgan, Muskingum, Noble, Perry, Tuscarawas, and Washington counties.

With its focus and commitment to community and economic development, the Dale Hileman Legacy Fund is a fund at the Foundation for Appalachian Ohio, whose mission is to create opportunities for Appalachian Ohio’s citizens and communities by inspiring and supporting philanthropy. A central part of this work is to support communities across five areas essential to community and regional quality of life. Called the Pillars of Prosperity, these areas include arts and culture, community and

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“So many of us were touched by Dale’s work at EODA and Columbia Gas, which is why EODA established the Fund in his memory at our July 17 meeting,” said Executive Director of EODA, Jim Schoch. “We are so grateful for Columbia Gas’ investment in this Fund so that the Dale Hileman Legacy Fund can truly pay tribute to and carry on the spirit of Dale’s work.”

OhioGas&Oil 11


H.R. 8, The North American Energy

Security & Infrastructure Act

H

.R. 8 is a broad energy bill that seeks to maximize America’s energy potential. The legislation seeks to update and modernize outdated policies rooted in an era of energy scarcity to reflect today’s era of energy abundance, and make our energy infrastructure more resilient and create jobs. 

Modernizing Energy Infrastructure

The United States has undergone an energy renaissance driven by newly discovered resources, technological innovation and our skilled workforce. The U.S. is now the world’s leading energy producer, but our pipelines and electric grid haven’t kept pace with the rapid transition. The private sector is eager to invest in new projects to put people to work, but there is simply too much government red tape slowing down the siting and permitting process. Likewise, our electricity sector is constantly evolving in the light of new challenges, such as changing markets, costly environmental regulations, and increasing grid security threats. H.R. 8 focuses on the transmission, distribution, and storage of energy to ensure

we have the necessary infrastructure to meet today’s modern energy challenges. 

Protecting the Electricity System

Ensuring the electric grid is secure, resilient, and reliable is another top priority of H.R. 8.  Changing market dynamics, a barrage of regulations, and external threats have created new energy security and reliability challenges. Disruptions in the delivery of electricity have far-reaching economic and public health impacts. The U.S. Energy Information Administration estimates that power outages cost Americans at least $150 billion annually. The legislation seeks to meet today’s energy reliability and security challenges through enhanced emergency preparedness and utilization of advanced technologies to address threats to the electricity system, including physical and cyber-attacks, electromagnetic pulse, geomagnetic disturbances, severe weather, and seismic events.

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As the world’s leading producer of petroleum and natural gas, the U.S. is a world energy superpower. With this position comes new opportunities and diplomatic responsibilities. America’s energy abundance should be used to strengthen our energy security while also supporting our allies in their quest for affordable and reliable energy. H.R. 8 takes important steps by strengthening partnerships with our allies and reforming the approval process for energy exports.    

Improving Energy Efficiency and Government Accountability

New technologies have the potential to save money and reduce energy use, yet government roadblocks stand in the way. H.R. 8 promotes simple and affordable methods to address energy demand and lower electric bills. It also seeks to reduce government waste and prioritize budget dollars in existing programs, as well as provide important regulatory relief for U.S. manufacturers from burdensome federal efficiency mandates.

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The Future of Shale Judie Perkowski • The Daily Jeffersonian

Q

uestions about the uncertainty of the gas and oil boom rebound, energy, the economy and environmental issues, the long term outlook for natural gas development in the Marcellus and Utica shale formations, and the growing demand for energy from developing countries were a few of the topics covered by W. Norm Shade, a senior consultant and president-emeritus of ACI Services in Cambridge, at the December Guernsey Energy Coalition meeting recently at the Southgate Hotel in Cambridge. The Coalition meetings, initiated by Jo Sexton, president of the Cambridge Area Chamber of Commerce in early 2011, has continued to engage personnel related to the gas and oil industry to speak at the monthly meeting to educate the community about all aspects of the development of our natural resources. Shade’s agenda included a PowerPoint presentation of maps and statistics showing the size and depth of the Marcellus and Utica shale formations in the Appalachian Basin which covers a large mass of New York, Pennsylvania, Ohio, West Virginia, Virginia and Kentucky. The Utica lies below the Marcellus, and while the Marcellus is primarily a source of dry gas, the Utica has both dry and the oil-rich wet gas.

together to work out reasonable, optimal strategies that preserve the economic well-being of developed countries and meet the growing demands of developing countries, while containing and minimizing future environmental damage and detrimental climate change with practical and attainable standards and policies,” he said. Although the country is enjoying low gasoline prices, especially in the Midwest, which hovers around $2 a gallon, the end result is that low prices and gas and oil exploration and development are mutually exclusive, meaning you can’t have both. “However, development has not dried up, entirely. Demand for natural gas is growing, so, development of natural gas from shale with continue, albeit at a slower rate. As prices recover, shale gas production in the U.S. is expected to double over the next 20 years,” said Shade. “Roughly 40 percent of that incremental production is forecast to come from the Marcellus and Utica Shale plays that includes eastern Ohio. All of this bodes well for our area within the next decade.” The next Guernsey Energy Coalition meeting will be Jan. 7, 2016.

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“The world contains abundant natural gas. The U.S. has more than 100 years of proven reserves of natural gas that can be recovered with current technology,” said Shade. “World demand for natural gas and all energy sources will grow as developing countries with large populations grow. In the next 15 years, the world demand for energy will increase by 20 percent, the same amount as the U.S. — biggest world economy and biggest energy user — currently uses.

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Fourteen of the students, who are enrolled in the petroleum geology program at Kent State University, were treated to a recent visit at gas and oil and injection wells owned and operated by David R. Hill, standing, third from l, president of the Ohio Oil and Gas Association. The students were excited to be on an actual operating oilfield. They are members of the Kent State Student Chapter of the American Association of Petroleum Geologists. Front row, l to r, Tim Reed, Elizabeth Bargdill, Krista Hardin, Joe Jeandervin, John Flask; standing, Pawel Rybak, Stacee Stinedurf, David Hill, Jonathan Mills, Roman Waked, Aramide Adesulu, Shannon Hunter, Joe Fejko, Ben Stillman, Mike Chadsey; back row, c, Sam Timko; and a PDC oil and gas worker.

Kent State Students

Visit Oilfield Sites

M

Judie Perkowski • Dix Communications ore than a dozen Kent State University students hung on every word spoken by Ohio Oil and Gas Association President David Hill at the three well sites the group visited to view first hand what they had seen only in text books and PowerPoint presentations. The trip was organized after Hill was a guest speaker at Kent State’s petroleum geology program. Students asked if it was possible to visit one of Hill’s sites, and Mike Chadsey, OOGA Director of Public Relations and alumnus of Kent State, was all too happy to accommodate the students’ request.

efforts of a petroleum geologist or engineer. First stop was at a farm in Salesville where Hill owns and operates a Utica unconventional (horizontal) well and a conventional (vertical) drilled well. Unconventional drilling is a longer process and unconventional oil drilling is a much more expensive process than conventional oil drilling. Some companies specialize in conventional or unconventional drilling. Most of the time companies begin drilling for oil conventional only, but then begin unconventional drilling later on to extract more oil.

Although Hill owns the wells, he leases the site from the Chadsey was also available to answer questions during the landowners who receive a royalty for use of their property. oilfield visit. Hill, a petroleum geologist, has been in the oil and “This is so great to actually see a real well site, instead of just gas industry for more than 30 years. looking at slides,” said Stinedurf. Stacee Stinedurf, Kent State graduate student and president of the Kent State Student Chapter of the American Association of After Hill answered questions and talked about how the geology Petroleum Geologists and leader of the group, said they were all of the land determined the kind of well that would be appropriate very excited to actually see the three types of wells in operating for the extraction of gas or oil, or both. mode. Next stop was to Old Washington where the students got up close The students’ enthusiasm neutralized the chilly November and personal with a pumpjack. A pumpjack, which resembles a weather as they hiked through fields to see up close the resulting bobbing horse head, is the overground drive for a reciprocating 14 OhioGas&Oil

GasandOilMag.com


piston pump in an oil well, and is common for conventional drilling. It is used to mechanically lift liquid out of the well if not enough bottom hole pressure exists for the liquid to flow all the way to the surface. Pumpjacks are common in oil-rich areas. Depending on the size of the pump, it generally produces 5 to 40 litres of liquid at each stroke.

The dike that surrounds the processing area was built under construction and inspection by the Ohio Department of Natural Resources. The dike can hold 11/2 times the volume of all full tanks. Even the rainwater is collected and pumped back into the well.

“We put the water back into the Earth where it came from,” Hill said the best part of this operation is that it brings free gas said Hill. and royalties to the property owner. Comments from the students ranged from “very impressive” and A drive through the countryside on the winding and hilly “actually more than I expected,” to” it was an amazing field trip.” country roads brought the visitors to Hill’s injection well site in Westland Township. Situated on two acres, the Devco Unit 1 Class II injection well, built in 2007, is the first of two injection wells drilled by Hill. The process begins when a truck hooks up to one of the intake pumps and draws the water to one of 21 storage tanks. Each tank holds 210 barrels of brine (wastewater). Each barrel contains 42 gallons, which equates to 8,400 gallons per tank. After the dirt and debris is removed from the waste water by a filtering process, it is pumped into the well under a maximum of 1,600 pounds of pressure to approximately 8,900 feet below the surface. The actual wellhead stands alone behind the tanks and covers an area about the size of an automobile parking space, fenced off and chained. Everything is self-contained for safety and protection of the environment. All Class II injection wells are subject to the Clean Water Act.

David R. Hill, c, president of the Ohio Oil and Gas Association and president and owner of David R. Hill, Inc., at the first site the Kent State University students visited where Hill owns and operates conventional and non-conventional wells in Salesville. Hill, who has the students’ undivided attention, was explaining, the how, where, when and why of gas and oil production from conventional and non-conventional wells. GasandOilMag.com

The second stop for Kent State’s future petroleum geologists on a day-long trip to visit oilfield operations owned by David R. Hill in southeastern Ohio, was to a well pad in Old Washington where a pumpjack stood motionless. The conventional well apparatus is dormant because of the glut of gas and oil. Hill re-started the pumpjack to explain its function to the group. Hill, president of the Ohio Oil and Gas Association, has dozens of wells scattered throughout the country. OhioGas&Oil 15


AP Fact Check:

Candidates & Climate Change

W

Seth Borenstein • AP Science Writer hen it comes to climate science, two of the three Democratic presidential candidates are ‘A’ students, while most of the Republican contenders are flunking, according to a panel of scientists who reviewed candidates’ comments.

Former Secretary of State Hillary Rodham Clinton had the highest average score at 94. Three scientists did not assign former Maryland Gov. Martin O’Malley a score, saying his statements mostly were about policy, which they could not grade, instead of checkable science.

Two used similar reasoning to skip grading New Jersey Gov. Chris Christie and one did the same for businesswoman Carly Fiorina. At the request of The Associated Press, eight climate and biological Republican Sen. Ted Cruz of Texas had the lowest score, an average of scientists graded for scientific accuracy what a dozen top candidates 6. All eight put Cruz at the bottom of the class. said in debates, interviews and tweets, using a 0 to 100 scale. “This individual understands less about science (and climate change) To try to eliminate possible bias, the candidates’ comments were than the average kindergartner,” Michael Mann, a Pennsylvania stripped of names and given randomly generated numbers, so the State University meteorology professor, wrote of Cruz’s statements. professors would not know who made each statement they were “That sort of ignorance would be dangerous in a doorman, let alone grading. Also, the scientists who did the grading were chosen by a president.” professional scientific societies. Vermont Sen. Bernie Sanders, with an 87, had the lowest score among the Democrats, dinged for an exaggeration when he said global warming could make Earth uninhabitable. Former Florida Gov. Jeb Bush scored the highest among Republicans, 64, but one grader gave him a perfect 100. Bush was the only Republican candidate who got a passing grade on climate in the exercise.

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Below Clinton’s 94 were O’Malley with 91; Sanders, 87; Bush, 64; Christie, 54; Ohio Gov. John Kasich, 47; Kentucky Sen. Rand Paul, 38; Fiorina, 28; Florida Sen. Marco Rubio, 21; businessman Donald Trump, 15; retired neurosurgeon Ben Carson, 13; and Cruz with 6. For the Republicans, climate change came up more in interviews than in their four debates. But Rubio did confront the issue in the Sept. 16 debate in a way that earned him bad grades from some scientists. “We are not going to make America a harder place to create jobs in order to pursue policies that will do absolutely nothing, nothing, to change our climate, to change our weather, because America is a lot of things, the greatest country in the world, absolutely,” Rubio said. “But America is not a planet. And we are not even the largest carbon producer anymore. China is. And they’re drilling a hole and digging anywhere in the world that they can get ahold of.”

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Scientists dispute Rubio’s argument that because China is now the top emitter, the U.S. can do little to change the future climate. The U.S. spews about 17 percent of the world’s carbon dioxide emissions, “so big cuts here would still make a big difference globally,” said geochemist Louisa Bradtmiller at Macalester College in St. Paul, Minnesota. Rubio’s inference that China is not doing much about

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global warming “is out of date. The Chinese are implementing a cap-and-trade system in their country to reduce emissions,” said Andrew Dessler, a climate scientist at Texas A&M University. At an August event In California’s Orange County, Cruz told an interviewer, “If you look at satellite data for the last 18 years, there’s been zero warming. ... The satellite says it ain’t happening.” Florida State University’s James Elsner said ground data show every decade has been warmer than the last since the middle of the 20th century and satellite data-based observations “show continued warming over the past several decades.” In fact, federal ground-based data, which scientists said is more reliable than satellites, show that 15 of the 17 years after 1997 have been warmer than 1997 and 2015 is on track to top 2014 as the warmest year on record. Scientists

singled

out

Sanders

for

overstatement in the first Democratic presidential debate. “The scientific community is telling us that if we do not address the global crisis of climate change, transform our energy system away from fossil fuel to sustainable energy, the planet that we’re going to be leaving our kids and our grandchildren may well not be habitable,” Sanders said. Dessler said, “I would not say that the planet will become uninhabitable. Regardless of what we do, some humans will survive.” Harvard’s Jim McCarthy also called the comment an overstatement, as did other scientists when Sanders said it. Recent research on the worst heat projections in the hottest area, the Persian Gulf, finds that toward the end of the century there will be a few days each decade or so when humans cannot survive outside, but can live with air conditioning indoors. Trump brought out some of the more colorful and terse critiques.

“It could be warming and it’s going to start to cool at some point,” Trump said in a September radio interview. “And you know in the 1920s people talked about global cooling. I don’t know if you know that or not. They thought the Earth was cooling. Now it’s global warming. Actually, we’ve had times where the weather wasn’t working out so they changed it to extreme weather and they have all different names, you know, so that it fits the bill.” McCarthy, a former president of the American Association for the Advancement of Science, called Trump’s comments “nonsense,” while Emmanuel Vincent, a climate scientist at the University of California, Merced, said, “the candidate does not appear to have any commitment to accuracy.” The eight scientists are Mann, Dessler, Elsner, McCarthy, Bradtmiller, Vincent, William Easterling at Pennsylvania State University and Matthew Huber at the University of New Hampshire.

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Members of the Lore City Volunteer Fire Department joined other departments in the OOGEEP training at Wayne County Regional Fire and Rescue Training facility.

Firefighters Trained to Respond

To Oilfield Incidents

D

emonstrating its commitment to Ohio’s first responders and the communities in which they serve, Ohio’s oil and gas industry is training firefighters how to respond to potential, but rare, emergency incidents in the oilfield. Facilitated by the Ohio Oil and Gas Energy Education Program, these trainings are held at a state-of-the-art facility using an endorsed curriculum that have both served as models for similar training programs around the country.

their firefighters and the oil and gas industry who provided this training,” said Asst. Chief Tim Mann from the Flushing Volunteer Fire Department. “OOGEEP does an amazing job providing qualified instructors, interesting presentations and a top-notch facility.”

OOGEEP’s workshops contain two days of informative and interactive lessons and hands-on learning. Day one features classroom presentations and discussion, providing an overview of Ohio’s oil and gas industry including the As the first of its kind in the nation, and now in its 14th year, processes and procedures used to develop these energy OOGEEP’s Responding to Oilfield Emergencies Workshop sources. First responders specifically learn how to distinguish has helped to train more than 1,350 Ohio firefighters and between normal operations and a true emergency. departments from seven other states. Recently, another 140 firefighters attended the training at the Wayne County The second day is full of hands-on learning, utilizing OOGEEP’s outdoor fire-behavior lab. The training site Regional Fire and Rescue Training Facility. includes a wide-array of oilfield equipment, specially Firefighters from the Lore City Volunteer Fire Department in designed to allow firefighters to experience and respond to a potential oilfield incident. More than 15 state-certified Guernsey County attended the workshop. fire-instructors help OOGEEP train firefighters at each of the “OOGEEP offered an excellent class that helps responders hands-on stations. and industry workers understand the roles of each during a potential incident,” said training officer Mike Warner from “Oilfield workers and firefighters often live and work in the Lore City VFD. “The class offered valuable hands-on the communities in which they serve and we’re proud to experience for both new and experienced first responders.” work together to improve our state,” said Marty Miller, Chairman OOGEEP Board of Directors and Vice-President “Firefighters need to receive training like this and I hope of Operations, Alliance Petroleum Corporation. “Ohio’s oil people in our communities will continue to support both and gas producers believe it is our responsibility to provide 18 OhioGas&Oil

GasandOilMag.com


local first responders with the tools and training necessary The training program is endorsed by the Ohio Fire Chief’s to serve their communities as we work to provide reliable Association, Ohio Society of Fire Service Instructors and and efficient energy for all Ohioans.” Ohio Fire and Emergency Services Foundation. It was developed as a collaborative effort between Ohio’s oil “OOGEEP prides itself on offering Ohio’s first responders a and gas industry, government regulators, firefighters and first-class training experience,” said Rhonda Reda, OOGEEP emergency response experts. The course meets national and Executive Director. “We have helped numerous other states state fire safety standards and attending firefighters can earn develop similar training programs based on Ohio’s model, a required continuing education unit credits and an optional testament to the national recognition of this industry-funded graduate credit. program. Working with our partners, we will continue to ensure our training meets all state and national industry About the Ohio Oil & Gas Energy Education Program and emergency response standards and maintains its status The Ohio Oil & Gas Energy Education Program is a as the best in the country.” nonprofit organization responsible for public outreach on behalf of Ohio’s natural gas and crude oil industry. The mission of OOGEEP is to facilitate educational, scholarship and safety programs and to promote public awareness about the industry, and its impact on the economy. For more information, visit www.oogeep.org.

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OhioGas&Oil 19


NEXUS Gas Transmission

Project Moves Forward

T

he NEXUS Gas Transmission project reached a significant milestone today as it formally applied to the Federal Energy Regulatory Commission for a Certificate of Public Convenience and Necessity to construct and operate an approximately 255-mile interstate natural gas pipeline. The NEXUS project provides critically needed Appalachian Basin natural gas to growing markets in Ohio, Michigan and the Dawn Hub in Ontario, Canada.

“The NEXUS project will play a key role in helping the U.S. transition to cleaner sources for generating electricity — including new power plants fueled by natural gas — as coal plants are retired due to their age and environmental regulations,” said David Slater, DTE Energy’s president of Gas Storage and Pipelines. “In Michigan, this project ensures that low-cost, cleanburning natural gas will be available for home heating and power generation far into the future. It also will create more than 6,000 jobs, $2 billion in capital investment “The NEXUS project relieves pipeline and added tax base in both Ohio and capacity constraints in the Marcellus Michigan.”The FERC application initiates and Utica shale plays and will deliver the agency’s formal environmental review clean-burning, affordable natural gas to customers in Ohio, Michigan, and Ontario, Canada. We have agreements with local gas distribution companies as well as producers that plan to use the pipeline to provide their customers with this vital energy resource, so important to the local economy,” said Bill Yardley, president of U.S. Transmission and Storage for Spectra Energy. “NEXUS has also recently signed a number of interconnect agreements with industrial facilities and power generators, as businesses need natural gas to grow and to keep jobs in the region. These of the project as the lead federal agency agreements demonstrate support not only charged with coordinating National for the project, but the route as well.” Environmental Policy Act (NEPA) compliance in reviewing pipeline certificate applications.

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During this period, FERC will evaluate all potential environmental impacts, as well as the company’s plans to address and minimize those. The application filing includes responses to comments made

during the FERC scoping period as well as a full evaluation of alternative routes and potential impacts of the NEXUS project. The proposed NEXUS route is strategically positioned to expand gas service while minimizing environmental impacts. Access to natural gas will enable communities along the proposed route to attract employers and provide lowcost energy to residential consumers and businesses. The market-based approach of siting the NEXUS pipeline stands to benefit customers all along the route, including local distribution companies, industrial parks and electricity generating plants.

Ohio market connections include: Dominion East Ohio, Columbiana County; Dominion East Ohio, Wayne County; Brickyard Industrial Park; Urban Renewables II, LLC, Medina County; Columbia Gas of Ohio, Inc., Medina County; NRG Power Midwest LP, Lorain County; Board of Commissioners, Erie County and Erie County Industrial Park; Dominion East Ohio, Erie County; Columbia Gas of Ohio, Inc., Sandusky County; Waterville Gas and Oil Company, Lucas County; and Ohio Gas Company, Fulton County.

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Hydraulic Solution Center

Your One-Stop Source For: NEXUS continues to negotiate with other customers along the route and will provide access to prospective customers even after the proposed in-service date of November 2017. NEXUS has and will continue to engage in extensive landowner and public agency outreach. The application provides a full evaluation of alternatives that were identified and evaluated by NEXUS during the siting and refinement stages of the proposed project. The primary objectives in evaluating alternatives are to avoid, minimize, and if necessary, mitigate potential adverse effects while satisfying the project’s purpose and need. Based on stakeholder feedback and survey data collected throughout the FERC Pre-File process, NEXUS has evaluated over 250 route variations and will continue to be responsive to stakeholder concerns throughout the regulatory review process. Approximately 87 percent of the proposed new pipeline route is in agricultural areas and/or follows existing utility corridors in Ohio and Michigan, thereby limiting the number of affected residential landowners and reducing environmental impacts. The FERC review process will continue to provide opportunities for public input by landowners, residents and other stakeholders. It will also prompt parallel environmental review by numerous state and federal regulatory agencies. The formal application requests that FERC issue an approval of the project in the fourth quarter of 2016. Construction is anticipated to begin in early 2017. For more information about www.nexusgastransmission.com.

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OhioGas&Oil 21


Energy Industry Forms Alliance

To Fight Utility Ballots

L

ago. What is more, ratepayers have already paid for the assets through rate recovery and again through stranded cost recovery when Ohio introduced competition in the electricity market. In the case of FirstEnergy, nearly $7 “If FirstEnergy’s deal is a corporate bailout, billion in stranded costs were recovered from AEP’s deal is a corporate handout,” Snitchler ratepayers. said. The group of eight energy generators and A level playing field where energy suppliers suppliers denounced the power purchase “Under this deal, AEP is guaranteed a profit compete also boosts Ohio’s economy by agreement reached with AEP that would paid for by hard-working consumers and lowering businesses’ operating costs and require ratepayers to subsidize the utility’s businesses that are just now emerging from encouraging investment without burdening unprofitable power plants. The group also an economic recession,” Snitchler said. “All ratepayers. Forcing businesses and residents opposes the settlement announced last week AEP and FirstEnergy customers will get stuck to subsidize companies that do not need and with FirstEnergy that guarantees subsidies that footing the bill for both of the companies despite should not receive subsidies makes Ohio less could cost ratepayers as much as $3.9 billion the fact that other electric power generating attractive to future investment from all kinds over eight years. companies are successfully competing in the of industries. market without subsidies or support.” The Alliance has retained former PUCO Some of the largest investments in Ohio in the “The PUCO will past four years have come from independent be helping utilities electric power generators that have built cleaner, take money out of more efficient, and lower-cost power plants. the pockets of Ohio Snitchler contends, “If PUCO commissioners residents, including approve these deals, they’re sending the older adults on fixed signal that Ohio is closed for business. incomes, faith-based Energy companies like the Alliance members organizations and will turn elsewhere to invest, innovate, and non-profits, and hire. Regulators will turn the lights out on handing it over to the construction of new, cleaner, cheaper natural companies and their gas-fired generation despite more than $5 billion Practicing in the areas of Estate Planning; shareholders,” he and nearly 6,000 megawatts of new generation Family Law; Business Law; Probate and said. “Ohio regulators under construction and already planned for Oil & Gas. should say no and Ohio,” Snitchler said. “What is worse, Ohio is instead continue to uniquely situated to see significant investment Call our office at (740) 432-7844 to make a let the competitive in new generation construction based on lowreservation to attend a complimentary Estate marketplace determine cost gas, access to water, and the ability to Planning workshop. which companies are te into a robust transmission infrastructure. winners and losers.” These decisions could fundamentally alter the January 21st. at 1:30 p.m. competitive landscape and leave ratepayers on February 4th. at 1:30 p.m. Snitchler pointed out the hook for investments others are already February 18th. at 1:30 p.m. that ratepayers have willing to make without subsidies.” shouldered the burden Frank A. McClure Counsellor-At-Law for the companies’ The case remains pending before the PUCO Melissa M. Wilson Counsellor-At-Law power plants since with briefs yet to be fled. Decisions on AEP and many were built FirstEnergy cases are expected sometime in the 1009 Steubenville Ave. Cambridge, OH more than 50 years first quarter of 2016. CA-10423035

eading companies in Ohio’s energy industry announced the formation of the Alliance for Energy Choice to oppose utility company deals with the Public Utilities Commission of Ohio that, according to projections, will cost some customers billions of dollars over eight years.

22 OhioGas&Oil

Chairman Todd Snitchler to organize the campaign calling on PUCO commissioners to reject rate settlements negotiated by PUCO regulatory staff.

www.fmcclurelaw.com

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8

Gas & Oil

Ohio Edition

August 2015 34th Annual Celebration

2015

Oil, Natural Gas Wells Reach

New Highs in 3rdFestival Quarter

D

Arts & Crafts

uring the third quarter of 2015, Ohio’s horizontal shale wells produced 5,696,780 barrels of oil and 245,747,686 Mcf (245 billion cubic feet) of natural gas, according to figures released today by the Toll Free Ohio Department of Natural Resources.

In 2015, 15,707,339 barrels of oil were reported for the third quarter, compared to 7,438,375 last year for a 111 percent increase. The natural gas or totals 651,193,106 Mcf this production year, up 126 percent from 287,846,105 a year ago.

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• The average amount of oil produced was 5,241 barrels. • The average amount of gas produced was 226,079 Mcf. • The average number of third quarter days in production was 78.

Quarterly production continues to set In 2014, Ohio’s wells produced new records as horizontal shale well 15,062,912 barrels of oil and 512,964,465 All horizontal production reports can CRAFTS OF DISTINCTION be accessed at oilandgas.ohiodnr.gov/ production totals have increased by Mcf of gas for the entire year. At Great Trail Festival Grounds • State Route 43 production. more than 100 percentnoise/dust from 2014’s third Instant reduction report lists 1,134 wells, 1,087 of quarter totals. Additionally, Ohio’s 12 month privacy for yourThe sites Ohio lawWeekends does not require horizontal shale wells have produced which reported production results. ★ Two Big ★ the separate Call for a planting quote today! wells reported no reporting of Natural Gas Liquids. Gas more oil and gas in the first nine Forty-seven 29, 30 totals and listed on the report on reporting months of this year than all of Ohio’s production as they are waiting Aug. 5, 6 & 7 pipeline infrastructure. Of the 1,087Sept. include NGLs. wells produced in 2014. wells reporting production results:

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OhioGas&Oil 23


Opportunities for Asset Protection Oil & Gas Interests You May Be Missing:

The Ohio Legacy Trust Act

W

Frank McClure • Attorney hen talking about Estate Planning & Asset Protection Planning in Ohio as we look toward 2016, if we didn’t talk a little bit about the Ohio Legacy Trust Act of 2013, we would be missing one of the biggest changes in the law for a long time. This act took effect in the State of Ohio on March 27, 2013. This Act provides for a new type of Trust, which allows an unprecedented level of asset protection in Ohio. Unlike a normal revocable trust, the assets owned by an Ohio Legacy Trust are in most cases shielded from creditors. With this act, Ohio has joined a minority of states in allowing these types of asset protection trusts. An Ohio Legacy Trust is available to not only Ohio residents, but also the residents of any state as long as the trust is created and administered in accordance with all of the provisions of the Ohio Legacy Trust Act.

The Ohio Legacy Trust is an irrevocable trust, meaning once the trust has been formed the Grantor no longer has the power to terminate the trust. Is this a problem? Not really, because the Grantor has already determined when and how they wanted to have the trust terminate when they had the trust drawn up. The Grantor can still maintain many other powers and rights with regards to the trust. Here are a few of the powers the grantor can retain: • The Grantor can be the sole beneficiary of the Trust or a joint beneficiary; • The Grantor can provide guidance and direction concerning Trust investments; • The Grantor can continue to live in a residence held by the Trust; • The Grantor can veto distributions from the Trust; • The Grantor can remove and replace the Trustee; • The Grantor can direct other distributions of trust assets to person’s other than the Grantor, Grantor’s creditors, or Grantor’s Estate. These powers allow a Grantor a large amount of control over the Ohio Legacy Trust, but also allow a level of asset protection not found in a standard revocable trust. The Ohio Legacy Trust also has limitations in regards to the Trustee. First, the Grantor cannot be the Trustee of the Legacy Trust. Second, the Trustee must be an Ohio Trustee. Therefore the Trustee can be either an individual who resides within Ohio, including the Spouse of the Grantor or any other family member or an Ohio corporate Trustee. These restrictions are necessary, to properly protect the trust assets, but the Ohio Legacy Trust Act still allows a great deal of flexibility in naming a Trustee.

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As with any type of estate planning, it is important to plan ahead in creating an Ohio Legacy Trust. This Trust is subject to a Fraudulent Transfer Statute in Ohio and cannot be used for the purpose of defrauding or avoiding known creditors. This statute comes into effect in all asset protection planning. In forming the trust, the Grantor must sign an affidavit, under oath, stating the following:

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1. The assets being transferred to the trust are not from an unlawful activity; 2. The Grantor has the right to transfer the assets; 3. The transfer won’t make the Grantor insolvent; 4. The Grantor doesn’t intend to defraud his or her creditors; 5. There are no court or administrative actions pending that are not identified in the affidavit; 6. And the Grantor does not intend to file for bankruptcy. As you can see these required statements should not be a problem if you plan ahead of time. The factors above will always come into play with any asset protection planning. Therefore, they are not something which should stop you from using an Ohio Legacy Trust, if you are concerned with protecting your assets.

These trusts are designed for those individuals who are planning for the protection of their assets. If created before an asset issue arises, the Trust will be shielded from almost all creditors. There are a few exceptions. First, creditors at the time of creation not the trust have a period of time to object and maintain their ability to seize assets. Creditors that arise after creation of the trust will not have this ability. Second, child support payments can be collected from the trust. Third, a former spouse will have rights against the trust if the trust was created during the marriage. Any Legacy Trust created before the marriage will not be subject to claims of a spouse or former spouse. I would say in most situations these exceptions are things most people would expect. The Ohio Legacy Trust creates a unique opportunity for individuals to protect their assets while benefitting from them. The key as in all estate planning is to plan ahead, while you can! The Ohio Legacy Trust is an effective shield for

most claims that arise after the creation of the Trust. The best time to act is now; don’t wait until it is too late. Remember, you can protect whatever is important to you. This can be your land, your oil and gas interests, your investments, etc. If any of the above is of interest to you, you should be talking with an attorney who concentrates in the area of estate planning, about asset protection and all your estate planning needs. If you would like more information you can contact our office or go to our website, www.fmcclurelaw.com.

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Reader Polls: Biggest Stories About

The Gas & Oil Industry in 2015 What was the biggest policy story of 2015?

58% Rejection of the Keystone XL pipeline 26% Continued efforts to lift the crude oil export ban 10% Efforts to reform the ethanol mandate 8% Plans to sell oil from the Strategic Petroleum Reserve

What was the biggest exploration and production story of the year?

49% Decline in rig count 25% Local economic impact of shale production 19% Shell’s attempt at offshore Arctic exploration 9% Uptick in mergers and acquisitions activity

What was the biggest transportation, storage and refining story this year? 52% 28% 11% 11%

Keystone XL decision Record high gas supply levels Expansion of gas pipelines across the US New EPA oil refinery emissions rule

What do you most want to see happen in 2016? 42% 30% 18% 12%

Recovery of oil, natural gas prices Pro-industry candidate elected president Lifting of the crude oil export ban Ethanol mandate reform

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GasandOilMag.com


Financial Woes Confront Firm Behind

New England Gas Pipeline

K

Stephen Singer • AP Business Writer inder Morgan Inc., the energy giant proposing gas pipelines in Northeast that have drawn opposition, is weathering another challenge — financial woes linked to falling energy prices and a steep drop in its stock price forcing it to find new sources of capital.

It will not eliminate near-term trading volatility, but Kinder Morgan will keep $3.7 billion that will help finance capital spending without the sale of shares or adding to debt, the analysts said.

The company’s stock price had been cut nearly in half, from a high of $32.68 on Oct. 8 to $15.72 on Dec. 8, when it cut its dividend. Falling oil prices have weighed on Kinder Morgan and the energy The Houston-based company announced Tuesday a 75 percent industry. However, investor concern over the company’s debt also cut in its quarterly dividend to 12.5 cents per share to conserve was a factor. cash for financing portions of its expansion projects. In addition to a $3.3 billion pipeline through western Massachusetts and Investors cheered the dividend cut, sending share prices up sharply southern New Hampshire sought by a Kinder Morgan subsidiary, Wednesday, but still far below the Oct. 8 high. Shares closed Friday it’s also proposing a Northeast pipeline network in Connecticut, at $16.66. Massachusetts, New Hampshire, New York and Pennsylvania. Tennessee Gas Pipeline Co., a subsidiary of Kinder Morgan, is Cutting the dividend allows Kinder Morgan to avoid issuing stock seeking to build a $3.3 billion natural gas pipeline through southern to raise capital or incur debt that could jeopardize its credit rating, New Hampshire and western Massachusetts. The company says it the company said. hopes to start construction in January of 2017 and put the pipeline into service in November 2018. Richard Kinder, executive chairman, said in a conference call Wednesday that the company’s stock price has reached the point New England is plagued by high energy prices because of “where it is no longer an economic source of expansion capital.” natural gas pipeline bottlenecks. ISO-New England, the region’s grid operator, said in its annual power system plan Nov. 5 that Kinder Morgan also rejected interrupting “very important, very “significant challenges to reliability, particularly in winter, are profitable” long-term projects to conserve cash, Kinder said. posed by natural gas infrastructure that is inadequate” to meet rising demand for natural gas for heating and generating power. Analysts said cutting the dividend will make capital available to help finance pipeline construction. Rob Desai, an analyst at Edward Opponents, including Massachusetts Attorney General Maura Jones, said it removes financing risks. Healey, say New England does not need additional gas pipelines to maintain a reliable source of energy for the next 15 years. “The underlying risks still remain: low commodity prices and the risks and uncertainty associated with that,” he said. Moody’s Investor Service downgraded Kinder Morgan’s credit on Dec. 1 to negative from stable, but restored its stable rating Tudor, Pickering, Holt & Co. said in a note Wednesday that on Wednesday, citing Kinder Morgan’s “very significant” the dividend cut ends an “investor/management game of cat dividend cut. and mouse.” The downgrade followed Kinder Morgan’s agreement to increase its ownership in Natural Gas Pipeline Co. of America LLC to 50 percent from 20 percent for about $136 million, Moody’s said. The credit agency referred to National Gas Pipeline Co. as a “distressed company” and said the negative outlook reflects Kinder Morgan’s increased “business risk profile and additional pressure on its already high leverage.”

GasandOilMag.com

OhioGas&Oil 27


Supreme Court hears cases

Involving Leases in Monroe County

L

David J. Wigham • Attorney andowners in Monroe County who signed oil and gas leases with Beck Energy over the last decade should be aware of two potentially significant cases pending before the Ohio Supreme Court: Hupp v. Beck Energy and State of Ohio ex rel. Claugus Family Farm, L.P. v. Seventh District Court of Appeals, et al. (consolidated into one case). The Court heard oral arguments in these cases on Tuesday, December 15, 2015. The central issue in Hupp is essentially whether Beck Energy leases, called Form G&T (83) leases, are perpetual no-term leases that are therefore void ab initio (or from the beginning) as against public policy. If the Court rules that the lease form is a void, perpetual lease, the holding would invalidate a form of oil and gas lease commonly used across the state and would directly impact all landowners in Monroe County who currently have undrilled Beck Energy leases.

28 OhioGas&Oil

The issue raised in the Claugus Family Farm case involves an order issued by the Ohio Court of Appeals for the Seventh District that tolled all undrilled Beck Energy leases in Monroe County beginning on October 1, 2012 and continuing “during the pendency of all appeals in this Court, in the event of a timely notice of an appeal to the Ohio Supreme Court, until the Ohio Supreme Court accepts or declines jurisdiction” (the “Tolling Order”). The Tolling Order prevents any Form G&T (83) lease anywhere in the state from expiring pursuant to its own terms while the courts determine whether the leases are void. The Tolling Order did not specifically identify the affected properties, and the Court of Appeals did not arrange for landowners who signed such leases to received notice, even though it affected the property rights of landowners across the state. The question before the Supreme Court is whether the Tolling Order violated the due process rights of such landowners.

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In Monroe County alone, mineral owners stand to lose millions of dollars if the Tolling Order is allowed to stand. Had the Tolling Order not been issued, absent drilling and the production of oil or gas in paying quantities, the Beck Energy leases in Monroe County would have continued to run in their primary ten-year terms, and many would have already expired, thus freeing up vast amounts of acreage to be leased by the landowners, who would then be entitled to lucrative signing bonuses and royalties from Utica producers. Even if the Court finds the Form G&T (83) lease is valid and not a perpetual, no-term lease, if Claugus Family Farm prevails and the Supreme Court rules that the Tolling Order was unenforceable as to Claugus, similarly-situated Monroe County landowners with expired or soonto-expire undrilled Beck Energy leases should be able to file lawsuits seeking a court order declaring that the Tolling Order is unenforceable as to them as well and that the Beck Energy lease expired. This outcome would allow other Monroe County landowners to sign new leases following the expiration of the primary term listed on the face of their individual lease. Since the standard Form G&T (83) lease contains a 10-year primary term, those undrilled leases which would otherwise have expired on or after October 1, 2012 could be ruled no longer in effect. If you are a landowner in Monroe County who signed an oil and gas lease with Beck Energy that is yet undrilled, it is highly recommended that you contact an experienced oil and gas attorney to advise you as to your due process rights and to monitor the proceedings before the Ohio Supreme Court. Depending on how the Ohio Supreme Court rules, landowners owned undrilled acreage may be able to file suit to have their Beck Energy lease voided. David J. Wigham is a second generation oil and gas attorney at the law firm of Roetzel & Andress in Wooster, Ohio, with more than 20 years of experience in the industry.

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OhioGas&Oil 29


Average Gas Price Soon Under $2,

Lowest Since Recession

G

David Koenig • AP Business Writer asoline is close predicted that demand will grow more to breaking slowly next year. The organization below a key expects 2016 growth to be only twop s yc holog ic a l thirds the size of 2015’s increase. barrier as drivers enjoy some of the cheapest pump prices since Rising production, mostly from OPEC, the recession. is also pressuring oil prices. Iran, Iraq and other members of the oil cartel are The nationwide average price of a trying to boost output as they dig out gallon of regular Saturday was $2.02, from economic sanctions and wars. down 58 cents from this time last year, according to auto club AAA. Experts Crude oil futures fell $1.14 to close at say it could drop below $2 a gallon in $35.62 a barrel Friday on the New York the coming days. Mercantile Exchange. For consumers, this winter is shaping up to be a good one, energy-wise. Forecasters predict warmer weather than normal, and fuel prices are low.

Tom Kloza, head of energy analysis for the Oil Price Information Service, said gasoline could go as low as $1.79 a gallon by winter, before rising again next year.

The retail price of heating oil for December through February is expected to average $2.40 a gallon, down 18 percent compared with last year, according to the Energy Department. The price of natural gas for residential customers is expected to average $8.72 per 1,000 cubic feet, down 9 percent.

“I do think it will be much higher in the spring,” he said, predicting they could rise to $2.75 a gallon.

On the roads, many drivers across the country are already seeing gasoline prices well below $2 a gallon. According to data compiled by AAA and the Oil Price Information Service, drivers in about half of the states are already paying less than $2. South Carolina has the lowest average price at $1.79 a gallon. At the high end, Californians are paying $2.65 and Hawaiians are shelling out $2.76. The relative bargains at the pump might last a while, because global crude oil supplies are high and demand appears to be weakening. Crude prices fell Friday after the International Energy Agency

30 OhioGas&Oil

Refiners often curtail production to perform maintenance on their plants during the slower late-winter and earlyspring periods, and that is followed by the annual summer surge in driving. That yearly decrease in supplies and uptick in demand usually pushes prices up as the beginning of summer approaches.

while gasoline is down only 16 percent.

If gasoline prices had behaved exactly the same as oil prices this year, she estimates that consumers would be saving another 6 percent at the pump — While gas is at its cheapest price in more about 12 cents on every gallon. than six years, some suggest it should be even cheaper. Consumers might not complain too loudly, however. Filling up a 20 gallon Jodie Gunzberg, the head of commodities tank will cost an average of $40.40 this research at S&P Dow Jones Indices, weekend compared with $52 a year ago. studied monthly prices for crude oil and And the Energy Department said this gasoline going back to 1988. She found week that the average household can that the two generally went up or down expect to spend $570 less for heating about the same. But so far this year, oil this winter, while a natural gas user she said, oil prices are down 29 percent should save 13 percent.

GasandOilMag.com


County Preparing Now

For Planned Cracker Plant

A

Cathryn Stanley • Dix Communications lthough at least four years in the future, Belmont County officials have begun preparations for the planned $5.7 billion PTT Global Chemical ethane cracker that would fill nearly a 500-acre area from between the Ohio River and Ohio 7. In April of 2015, Governor John R. Kasich announced that PTT Global Chemical (PTTGC), Thailand’s largest integrated petrochemical and refining company, and its project partner, Marubeni Corporation, a Japan-based company, selected the site in Dilles Bottom, for the possible construction of a worldscale petrochemical complex, also known in the industry as an ethane cracker.

Authority Director Larry Merry were both confident that the project will move forward. Merry said that if built, thousands of local construction jobs will be created. He said company officials were already meeting with the local labor groups. Once built, those initial construction jobs would be followed by more high tech permanent jobs at the plant. Merry said company officials have also met with the deans of local colleges to help them develop programs now to help meet the jobs needs of the plant four years from now. “So current high school seniors will be able to prepare themselves for those jobs,” Merry said.

At the beginning of September, 2015, officials with PTT confirmed they would spend $100 million to conduct detailed Commissioners have touted the “game-changing” affects the engineering and design plans. cracker plant will have on the area if built. The proposed plant would crack ethane pumped from “As we garner national attention for our unprecedented Marcellus and Utica shale wells into ethylene, which can be economic growth, it is important to keep our best foot forward used to make plastics, textiles and pharmaceuticals. and continue to show that we have always been, and will remain, a great place to live, work and raise a family. We are Commissioner Matt Coffland said the county had previously excited to welcome this new project and the jobs and economic been in the running for the Royal Dutch Shell ethane cracker impact it will create,” Commissioner Ginny Favede said. which Shell officials ultimately agreed to take to Beaver County, Pa. He said county officials met with Shell in 2010. They were “Belmont was selected as the number one potential site for this approached by PTT in September of 2013 to look at the site. project based on our area’s skilled workforce and qualified Coffland said officials also showed company representatives trades people. The good men and women of Eastern Ohio housing, shopping, hospitals and schools. are ready and willing to assist. Since day one, we have made Belmont County’s economic competitiveness one of our highest At the December 9 Barnesville Area Chamber of Commerce priorities and that effort and commitment are paying off.” meeting, Commissioner Coffland and Belmont County Port GasandOilMag.com

OhioGas&Oil 31


Study Predicts Considerable

Industry Growth in Ohio

Sophie Kruse • Dix Communications According to a series of new reports published by “Encouraging and entering these markets requires long-term planning Cleveland State University, there is still a large amount and relationship building,” it says. of growth to be found within the gas and oil industry in Ohio for the next several years. The final report, “Economics of Utica Shale in Ohio: Workforce Analysis,” looks into the projection of workforce for future development. The reports were published in September by researchers from the Center for Economic Development, Energy Policy Center in the Maxine “The future workforce demand from the oil and gas industry in Ohio will Goodman Levin College of Urban Affairs at CSU: Iryna Lendel, Andrew be affected by a number of factors, including: the increased complexity R. Thomas, Bryan Townley, Marcus Notaro, Jeffrey C. Dick, Thomas of shale drilling and processing, oil and gas commodity and derivative Murphy and Ken Kalynchuk. The report was prepared for The Economic product prices, the volumes of produced oil and gas extracted, access Growth Foundation and JobsOhio. of main producing companies in Ohio to midstream infrastructure, companies’ strategies for future upstream and midstream development, The report was released in three parts: “Mapping the Opportunities for and lease acquisition and maintenance in Ohio’s portion of Utica play,” Shale Development in Ohio,” “Economics of Utica Shale in Ohio: Supply the report said. Chain Analysis,” and “Economics of Utica Shale in Ohio: Workforce Specifically, the report predicts that employment will rise from around Analysis.” 7,500 in 2015 to more than 10,000 by 2019 in terms of direct jobs in the The first report, “Mapping the Opportunities for Shale Development pre-drilling, drilling and production phases of shale well development. in Ohio” covers topics including Utica Shale production history and This doesn’t include jobs in related fields like transportation, pipeline projections, volumes and throughput projections, midstream company and midstream processing operations, or the effect the industry has on activities, prospects for Utica-Marcellus products in Ohio and prospects restaurants and hotels. for Ohio downstream development. The report found that there are a multitude of new opportunities This report had a two main conclusions: that the anticipated production that will be found in the future of the industry in Ohio, specifically of natural gas in the Utica/Marcellus basin will create an abundance in transportation, storage and processing of hydrocarbons, the use of ethane in the region by 2020 in excess of the takeaway capacity and of natural gas in the generation of power, refining operations and that the ethane surplus in the region should drive the development of the distribution and conversion of petrochemicals into commercial downstream markets for ethane in Ohio, which will create opportunities plastic products. for new growth in the downstream petrochemical business. The greatest number of opportunities, however, are related to The second report, “Economics of Utica Shale in Ohio: Supply Chain ethane processing as there are several cracker plants that are Analysis,” analyzes a number of different topics including unconventional planned for the region. oil and gas supply chain, shortages in the upstream supply chain and suppliers and consumers of the extraction of natural gas liquids and The report also highlighted what will be the largest challenge in the crude petroleum industry, of the drilling oil and gas wells industry and industry within the next five to seven years, which will be the “great of the petrochemical manufacturing industry. The report looks at seven crew challenge.” stages within the upstream development to evaluate opportunities: “exploration, site planning and preparation, site construction, drilling, “…Which highlights the large gap in knowledge between baby boomergeneration managers and the young workers who will replace them. hydraulic fracturing, completion and production.” Once the baby boom generation retire, the industry could face a According to the report, the best opportunities for supplying goods leadership and skills crisis. This challenge prompted the industry to and services for gas and oil companies in the state exist in supporting create stronger connections with high schools, community colleges, upstream and midstream industries. While downstream expansion and higher education institutions to provide a skilled workforce that is might not provide opportunities right away, it suggests the there’s a real prepared to help the industry make this employment shift..” The reports are available as a whole at www.csuohio.edu/urban/research/shale-reports. prospect for commercial investments.

32 OhioGas&Oil

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Ohio Gas&Oil January 2016