Stow has no claim to mineral rights permitting gas well's operation

Local officials frustrated with lack of control over gas, oil drilling processes

by Jeremy Nobile | Reporter Published:

Stow -- City officials are legally unable to stop the operation of a gas well at the Church of New Hope.

The city has learned it has no claim to the mineral rights under Ritchie Road, according to the findings of a recent title opinion. The driller requires leases for those rights from the owner(s) in order to operate.

"The title opinion indicates that the owners abutting Ritchie Road, their property goes to the center of the road," said Law Director Brian Reali. "The city owns basically an easement for the road for the public good. Anything under that road is owned by the property owners."

Because the mineral rights are owned by the residents, all of whom have leased their rights to the drilling company, the city has no legal ground to stop the well's operation.

Reali said the additional title opinion, which came from local company Prescott-Revere Land Title Agency, is the second to confirm the city has no interest in those mineral rights.

"I think it's pretty clear now that we have two different title companies giving us the same answer," he said.

The background

The city solicited the most recent title opinion after learning that a gas well located in a residential area on property owned by the Church of New Hope on Darrow Road was activated last month.

The city had withdrawn a proposed lease to mineral rights under Ritchie Road to Pursie E. Pipes Drilling Co. this summer that the company believed it needed to complete drilling the well.

So, city officials were surprised when the Ohio Department of Natural Resources, which regulates all gas and oil well drilling, informed the city the well could be completed.

PEP, a company headquartered in Mount Vernon, Ill., had offered the city $20,000 plus 1/8 royalty to lease the mineral rights tied to land under Ritchie Road. At the time, it was believed the city owned those rights, so without a lease from the city, drilling couldn't legally be completed.

PEP Landman Bill Marks said the church well was first vertically drilled in 2011 as the company attempted to pass through Clinton sandstone in order to release and collect natural gas.

The company then discovered the well needed drilled deeper -- down about 4,000 feet in total -- to reach gas.

The deeper any well is drilled, the more the surrounding radius from which leases for mineral rights required from property owners grows.

Because PEP had to drill farther than originally planned, they had to secure additional leases for mineral rights from property owners within a minimum 40-acre zone around the well head. That's when the company approached the city with a lease agreement for the mineral rights below Ritchie Road, which is a street near the well that runs west and perpendicular to Darrow Road.

When the proposed lease agreement was withdrawn during a City Council meeting in the summer, city officials believed the issue was over, and the well would be sealed.

However, PEP sought a title opinion of its own. The findings of that opinion asserted Stow didn't actually have a claim to those mineral rights, but the individual property owners did.

That opinion and copies of all leases required from nearby property owners were submitted to ODNR, and the company was permitted to move forward with completing the well.

Marks verified the well has been finished. It has been drilled vertically and fracked with a mixture of sand and water, but no chemicals.

Officials unhappy with lack of control

The recent title opinion given to the city verifies Stow has no interest in the mineral rights under Ritchie Road, which means the city has no legal standing to challenge the church well's operation in court if it wanted to, Reali explained.

A claim to those mineral rights was the city's only option to control and possibly halt the well's operation.

"What I keep explaining to people is this [drilling] is completely regulated by the state of Ohio," Reali said. "Until the state changes the law, this is the system that we're stuck with."

Reali said he recognizes the significance of harvesting Ohio's natural gas, but wishes local governments had some control to regulate drilling because, in this case specifically, he feels the well doesn't belong in such a densely populated area.

"For me, it's not about drilling or not drilling because I'm for it. My problem is the state telling cities they have to allow drilling in residential areas like this," he said.

"It's common sense that you don't want a gas well in someone's backyard," he added. "We wouldn't let you build a petting zoo in your backyard if it doesn't fit in with the neighborhood; but with something like this, we have no control."

House Bill 537 is proposed legislation that would restore local control over drilling back to municipal governments instead, taking the powers of control and regulation out of the state's hands.

Mayor Sara Drew said she's disappointed that Ohio's municipalities have no control over gas and oil drilling and supports the idea of restoring power to local governments.

She called the exclusively state-run oversight of drilling process an "unfortunate circumstance."

"Local leaders across Ohio have expressed frustration that there is no ability for local governments to have control over these drilling processes in our communities," said Drew. "I'm hopeful the state will revert back to previous rules that did allow municipalities to have some measure of control over that."

Email: jnobile@recordpub.com

Phone: 333-541-9400, ext. 4179

This story was updated on Dec. 18. A statement about the area required to be leased for mineral rights around the well head should have referenced a 40 acres and has been corrected.

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