County Line Landowners Coalition Newsletter
December, 2011

Past Newsletters

The County Line Landowners Coalition (CLLC) sponsored a meeting on October 27th at the Marathon High School. The presenter was Mr. Nick Schoonover, the leader of the Tioga County Landowners Group.

Mr. Schoonover covered several facets of the current Marcellus Shale activity including:

1. slides of ongoing drilling activities in Pennsylvania,
2. the protections DEC is including for review in the current version of the dSGEIS, and
3. a new shale fracturing process that uses no water or toxic chemicals, but instead uses liquid propane gas (LPG) as the major component in the fracturing process.

A very clear video was presented showing the process used to create the gelled LPG with suspended sand that is pumped into the shale formation to force and prop open existing pores and fissures within the shale. All landowners were invited to attend this presentation, including the Taylor Landowners Group. Ken Diaz, leader of the Taylor Landowners Group, prepared an excellent synopsis of the presentation, which, with Ken's permission, is reproduced at the end of this newsletter.

The Steering Committee of the CLLC has completed preparation of a lease with the assistance of our Attorney, who has been directed to present it to the gas/oil industry. A membership meeting with our Attorney is being arranged for early 2012. You will be notified by email once a date is set; please also visit our website for updates and announcements. We strongly urge you to attend this VERY important meeting.

An educational seminar on natural gas exploration is scheduled for Tuesday, December 6th, from 7pm to 9pm in the auditorium at the Cortland County office building located at 60 Central Avenue. This informational session will focus on real property issues and mortgage lending considerations associated with natural gas exploration.

Full Details >>

The dSGEIS is now in the public review and comment period. This period ends on December 12, 2011 after which the DEC must review and respond to all comments of substance. A public hearing is scheduled at the time of this writing for November 17, 2011 at the Forum Theatre in Binghamton N.Y. This hearing has been well advertised. Written and spoken comments will be received for consideration. It is important that people, regardless of their position on the process of shale fracturing, provide comment that are directed to the portions of the dSGEIS and not simply provide "pro" or "con" remarks.

It is worth emphasizing that the use of LPG-based process for shale fracturing is covered by the existing GEIS regulations and therefore does not need implementation of a new SGEIS or the lifting of the governor's moratorium on high volume hydrofracturing, since no water is involved. That is drilling applications submitted to DEC using LPG-based fracturing would be accepted and reviewed TODAY!

The following is Ken Diaz's summary, with minor changes for clarity, of Nick Schoonover's presentation :

"I attended the County Line Coalition Meeting at Marathon High School last night with Nick Schoonover presenting. Nick is the leader of the Tioga Gas Group. The Main topic of his presentation was "Gas Frac". It is a revolutionary new process to extract Natural Gas without the side effects. I have enclosed a letter "hopefully" explaining the process.

Nick started by expressing the fact that the NYS DEC has added protections in the dSGEIS that are unique to NYS and will greatly improve protecting our lands and water sources. They have added an "extra" casing on all wells and they have added "blockers" to all casing cement used. Together they will provide excellent protection against blowouts and casings deteriorating in the future.

Also discussed were the pitfalls of signing a Gas Company Lease. "Don't sign one" and don't allow anyone to buy your mineral rights. There are some landsmen offering up to $4,000.00 per acre to buy your rights, but the problem is you lose "ALL" your rights "forever" and you "will not" receive any further payments or royalties. Your property will basically be worthless if you try and sell it. Protect your children and grandchildren. Plus, we must make sure we are the 2nd insured on our Energy Companies' insurance policy and make sure everything that is promised is in writing. Currently I am working on an agreement to obtain a super lease that the CLLC has worked up with our Attorney that will protect us, our land, and our future.

There are up to "7" layers of gas beneath us, "4" that are credible. Gas harvests results are gaining on a daily basis. Production can last 25 to 50 years, just in the Marcellus, and no one knows how much longer in the other layers, remember, they are stating that the Utica may be much more prosperous!

The JLC is still working to get NYS to pass the 18 7/8 percent royalty payment, with no deductions, to landowners that have gas pulled from their property through compulsory integration, (currently you will receive only 12 ½%). The bill is currently stuck in Committee. It was reaffirmed that if you are subject to compulsory integration; the Energy Companies can drill and pull gas from under your property but cannot trespass onto your property.

There is currently a bill in Congress, House Bill HR1380 - "Nat Gas Act". It gives tax incentives for Fleet Conversions to natural gas & natural gas Infrastructure improvements. They think this will cut the demand for foreign oil by 50% and reduce emissions pollution by 60%. Currently the United States imports 1.1 billion dollars of oil "per day"! That's 763,889 dollars per minute!

Nick also stated that Norse Energy, in Chenango County, is going bankrupt and moving out of New York State. They are selling all their leases, (hopefully not to a Foreign Country). Also, when Chesapeake Energy sold a 33% stake in their leases to Statoilhydro, they received $5,700.00 per acre. They are now offering us $250.00 per acre, peanuts, (their landsmen probably make more than our landowners)! I will try and verify these statements, but like I said they were stated at the meeting last night.

For those interested, there is a paper called "Frack Focus" that lists all chemicals used in hydraulic fracturing.

GAS FRAC from Energy Services

Presented by Nick Schoonover

I will try and explain "GAS FRAC": It was developed in Canada and they are slowly progressing with care and diligence. This process uses LPG, (liquefied propane gas), and sand to frack their wells and there is no water needed or used. There are no harmful chemicals or biocides, no waste stream, flaring is not required, and flow back is in a gaseous state with 99% recovery to be sold or reused! The gel consists of LPG mixed with phosphatases (gelling agent), magnesium oxide (breaker) and iron sulfate (activator). The benefits:

1. One way handling - huge reduction in truck traffic, (947 loads of water vs. 30 loads of LPG).
2. Quicker site cleanup, (no fracking fluids etc.).
3. Less fracking stages, job volume, and wells, (more efficient fracking results); much reduced fracturing time.
4. Low viscosity and surface tension.
5. Enhanced well Productivity and Performance.
6. LPG handling regulations are well defined since the 1930's.
7. Lower cost per frack foot. $2,500 vs. $1,500.
8. 750 wells completed to date.

Supposedly each well could produce up to 1 million more dollars for our landowners. It also means much more money for the Energy Company using the process. According to Nick, if GAS FRAC is used by a Drilling Company it doesn't fall under the SGEIS, it falls under the current regulations in effect by the DEC! There are currently 40 Companies that have signed on so far, but "of course", no Company has brought it into NYS yet. So, even though it is extremely promising, we are still in a "wait and hold" status. Nick is talking with every NYS and US Government Politician and Official he can contact. He is super knowledgeable and a superb diplomat supporting us on a daily basis. Our hats go off to him and the many JLC staff and members who continually work our behalf!"