Extracting oil and gas from shale will be a booming industry across parts of the United States for years to come, and it will also be controversial, as the hydraulic fracturing (fracking) method used to extract the oil and gas is very controversial.
This has been a big issue in Pennsylvania, and not it’s moving to Eastern Ohio.
The boom in gas wells that turned Pittsburgh into “the new Houston,” made rich men out of poor farmers and spawned an environmental backlash has reached Ohio.
Land men, including free-wheeling shysters as well as legitimate gas and oil company employees, are swarming Ohio’s eastern counties, clogging county courthouses with their property record searches and pestering busy farmers.
Their objective: to tie up as much acreage as possible by persuading landowners to sign five-year leases granting them the right to drill for oil and gas in the rock known as Utica and Marcellus shale, buried thousands of feet below.
Geological experts have estimated that the gas-and-oil-rich shale may lie under 5 million acres of rural Ohio landscape and the deposits could contain energy equivalent to billions of barrels of oil.
The implications for Ohio’s economy are tremendous, but so are the challenges for landowners, many of them poor farmers who must first sort through the thorny offers of oil companies, and then wrestle the financial decisions of sudden wealth.
Prices keep going up for leases, so the frenzy is getting even more intense.
Many U.S. oil and gas companies are getting involved.
One of the latest hot spots for deal making is far from New York City or Silicon Valley—it’s in eastern Ohio, where energy companies are staking claims in what is being touted as North America’s next big energy field, the Utica Shale.
While the 170,000-square-mile Utica Shale sprawls beneath parts of eight states and Canada, energy companies and analysts believe the richest reserves of oil and valuable natural-gas liquids, such as propane and butane, lie in eastern Ohio.
In recent weeks the buzz around the area has intensified. Large producers’ moves into the area are becoming public. This month has seen big acquisitions. And stock analysts are recommending shares of small companies with Ohio acreage.
Last week, Exxon Mobil Corp. confirmed it is snapping up drilling rights in the Utica Shale. Exxon won’t say how much land it has locked up or where the property lies. But the move caught Wall Street analysts’ attention.
This industry has the potential to turbo-charge the U.S. economy, but at the same time environmentalists are concerned from both a global warming and safe drinking water point of view. Expect serious battles ahead.
