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Experts advising landowners on legalities of gas contracts
By JOLENE CRAIG
Ohio Correspondent

PARKERSBURG, W.Va. — A group of farmers gained pointers on the drilling and well development for natural gas from the Marcellus Shale, and what it means to lease land and/or mineral rights to companies for drilling, during an informational meeting Jan. 17.

Father-and-son team of lawyers Scott and Rod Windom from Harrisville, with James Lydon from the Wirt County Oil and Gas Group, in West Virginia were the featured speakers for the Wood County Beef Assoc. Farmers Short Course series at the Judge Black Annex in Parkersburg.

More than 50 people, mostly area farm owners, attended the meeting and many had concerns about their rights if they allowed drilling on their lands.

“You all own farms, and surface damages – hay production, pollution, loss of water – are a major concern,” said Scott Windom. “We have had clients with these issues and do not want more, but it will happen if you are not careful.”

He added his office has drafted a number of agreements to address these issues for future lease agreements. “If a company comes onto your property, you need to make sure of where they are going, what they are doing and how long they will be there,” he said.

Fracking, or hydraulic fracturing – the use of sand, water and chemicals injected at high pressures to blast open shale rock and release the trapped gas inside – is a concern for many people who use wells for drinking water or have water sources that supply their livestock, he said.

The Windoms said many of these tracts of farm country have transformed into industrial sites with activity going 24 hours a day.
“These are like small cities,” Windom said. “It is an industrial complex. It is an issue if you are living next to it. When most people sign these leases, they do not understand what is going to happen, and they need to.”

Another area of the agreement that needs to be looked at is compensation, Windom said. “They are going to come onto your property and drill,” he explained. “You need to know if it will be worth your time because if you own the oil, gas and mineral rights, allowing drilling can be very profitable.”

As fracking has not come to the north-central area of West Virginia, Rod Windom said farmers in this area have the unique opportunity to see what has gone wrong with the operations in other areas, to learn from them.

“It is important that you consult with a lawyer before you engage in any of these negotiations and before you put any ink to paper,” he said. “If you don’t, the consequences can be far-reaching.”
Lydon is involved with landowners who have joined 67,000 acres to market to gas companies for development of natural gas. He talked about drawing up an agreement between companies and landowners that is fair to everyone involved.

“We have formed a cooperative group in Wirt, Wood, Jackson, Calhoun and Ritchie counties to correct many of the issues that come up during the life of these wells,” he said. “Most of you, when you sign this lease, do not think it is as critical as it is.

“Once you sign it, you, your children and whoever has that property later will have to live with it forever.”

By having long-term contracts, many of which can last 100 years, Lydon said these contracts can be done well and be positive for all involved in them. “If these leases are done right, it works,” he added.
1/23/2013