"Don't make a bad deal then, call the DEP and ask them to fix it."

That was the advice from attorney George Patterson at Thursday night's Natural Gas Education Program, presented by the West Virginia University Extension Service at the Marlinton Municipal Building.

"Get a lawyer," Patterson advised.ﾠ "The DEP regulates the drilling companies, but you are responsible for your decisions."
Patterson acknowledged that un-leased mineral rights are worth a lot of money, but landowners need a lawyer to help them make the right decisions.

"The industry says, ﾑthis is the Standard Lease,"' Patterson told the crowd. "There is no Standard Lease. You are creating a legal relationship and you need to negotiate."

Common wording in a lease agreement may say, "so long thereafter," and that may mean a minimum of 30 years up to 200 years.

Patterson said he recently visited a 92-year-old operating well, that is still producing.

Addendums can be added to the "standard lease," and that is what the company will do for the landowner.

Other advice Patterson offered:
ﾕ Make sure you know who has the check
ﾕ Carefully read the payment form
ﾕ Avoid bad paperwork

ﾕ Don't sign a lease if you don't understand the words
When a landowner signs a lease, they have granted an option to the company to have a limited amount of time to drill. If no drilling takes place and the lease is up for renewal, the landowner is under no obligation to renew.

However, once drilling commences, the company is in charge, said Patterson.

Patterson advised that lessors must have a price escalation clause inserted for long-term leases.

"Two-hundred dollars an acre may be something now," said Patterson. "But how much will $200 be when your grandchildren own it 20 years from now?"

Patterson's words were well received, coming on the heels of a presentation of Environmental Aspects of Oil and Gas Drilling, by former inspector-turned-advocate John King, of the West Virginia Department of Environmental Protection.

"I'm not a nay-sayer," said King.ﾠ "I use natural gas every day."
Although 99 percent of gas and oil wells come from fracturing, Marcellus Shale drilling uses hydro-fracturing, which brings with it the possibility of contamination from water used in the process.

"Fracturing is nothing new," said King. "It's been going on for years.ﾠ But Marcellus drilling is new."

King guided the group through the above ground effects of Marcellus Shale drilling

One aspect of that is the fracturing water returning to the surface.

Twenty percent comes out fairly quickly, according to King, but as the flow reduces, contaminants are more concentrated. That slow return is due in part to the fact that companies like to drill 8,000 feet or more to extract their product.

"The closer to the surface, the less economical," said King.
The Office of Oil and Gas regulates not only Marcellus drilling, but 55,000 active wells, 12,000 inactive,and abandoned wells in the state.

As of September 2010, there was only one advocate in the DEP.ﾠ Two more positions have been added, in part, due to the Marcellus process, said King.

When drilling begins the first thing people notice is heavy traffic, King said.ﾠ Water haulers and rigs can number 47 per hour during the drilling operation.

An influx of heavy traffic means road conditions deteriorate more rapidly.

The DEP does not deal with road issues, but the Department of Highways has videoed road conditions prior to well development, and they want the roads put back to their original condition.

Drilling in Wetzel County was like a gold rush, said King. Local citizens formed a group and invited the industry to have a conversation about the effects heavy traffic on the roadways.
"The companies sometimes fix the road," he said.

When it comes to air quality, King spoke about the dust and diesel fumes associated with the drilling process.

"There are no laws that would prevent a dozen water trucks from idling outside your house for hours," he said.

In addition, companies are legally allowed to flare for 30 days. The 31st day is a violation.

Once a Marcellus well is drilled, open flaring [flame] is often used to test the production of the well.

Fumes from flaring on a Marcellus job have generated no scientific studies, "no peer reviewed data" asﾠ to their possible harmful effects.

"Ventilation tanks - are they safe or are they not?"ﾠ
King answered his own question, "We don't know.ﾠ We have no peer-reviewed data."

"The DEP can only do what the legislature allows us to do," King said. "If you have a company that just doesn't care, it can be a long haul."

But legislative language is changing every day, King added.
At this point, Marcellus Shale drilling falls under the only regulations on the books, for vertical well drilling.

"The law says they can drill within 200 feet of your house," said King.

That law was put into effect when vertical drilling was the only way to go, he said.

The industry favors horizontal drilling to extract gas from the Marcellus Shale.

"It is unconventional," said King.ﾠ "Horizontal drilling can reduce the environmental footprint."

In addition to noise and air pollution in communities, there are land use changes as well, as farmland becomesﾠ industrial sites, he said.

Despite the "amazing technology" of deep, horizontal drilling, King said, companies seem to be "unable to keep mud from sliding down the hill and well pads from slipping."

Landowners interested in leasing their rights should insist on a stable well site, advised King, and deal with companies that adhere to Best Practice Management - companies that use silt fence and mulch to protect the surrounding area and maintain secondary containment pads to prevent groundwater contamination.

All companies are required to use silt fence to prevent run-off.
"Some silt fence is just eye candy," said King.ﾠ "You can sometimes stick your foot under it, so mud can slide under it, as well.

"If you, as the public, see anything that is not allowable, call me and email me a picture," King said.

Complaints can be made by calling 800-642-3074.

There are companies who "do it right," and landowners are encouraged to check into past drilling operations and ask if the company has ever had a permit withdrawn or complaints filed against them.

King showed the group pictures from Wetzel County, where a beautiful stream was buried under rock and made into a haul road.

"Due to enforcement action, they have had to reclaim the waterfall," King said.

Marcellus drilling presents a unique impact to sensitive areas such as wetlands and karst.

"Karst requires extra precautions," said King.

While water usage is of great concern to the public, Marcellus well sites do not use a lot more water than other industries, such as power plants, said King.

The difference in the industries is how Marcellus drilling puts that water back into the environment.

Companies are asked to use the USGS stream gauges to see if there is sufficient water flow in an area before drilling.
"This is not enforceable," said King. "It is strictly voluntary.
"Good companies have tanks for liquid storage and having used the water once, will store it in tanks and take it to their next job," said King.

But transference of this water has the potential to introduce non-native plants, fish diseases and golden algae to an area that otherwise would be unaffected.

Water used in the fracturing process should not be sent to wastewater treatment plants, according to King, because these plants are not prepared to treat it.

"Most companies are recycling and using the water at the next site," King said.

Drilling fragments can be radio-active, as well, although radio-activity is all around us, and usually does not cause a problem.
"But do not bury those cuttings on your property," King advised.
"The Local Emergency Planning Commission should be engaged with the industry, and know what to do in case of a well fire," King said.

Unanswered questions surrounding the relatively new Marcellus drilling process, put a major responsibility on the landowners to do their homework.

No none yet seems to have all the answers. But King's words were in harmony with Patterson's advice: Entering into a lease for Marcellus Shale drilling is not for the uninformed.

Patterson practices law wth Bowles, Rice, McDavid, Graff and Love in Charleston

ﾠ

ﾠ