Officials are urging landowners to do their homework and seek legal advice before entering into any agreements with oil and gas prospectors, who are starting to show some interest in Washington and surrounding counties.
The frenzy is over gas being recovered from Marcellus and Utica shale formations, both of which can be found in Washington County.
The Marcellus formation alone is believed to hold more than 50 trillion cubic feet of recoverable gas.
"There's a ton of money down there, from what I'm hearing," said Jack Jurin, president of the Washington County Farm Bureau.
The farm bureau has held two meetings this year to educate landowners of their rights and caution them to not rush into any agreements. Buckeye Hills-Hocking Valley Regional Development District is hosting a two-day session on the topic Aug. 2-3 in Marietta.
"When I joined the farm bureau 8 or 9 years ago it was because I had concerns about some companies not paying proper royalties," Jurin said. "We don't want to see that happen again."
Fact Box
Coming up:
Informational sessions for area leaders and landowners on Marcellus and Utica shale formations:
Aug. 2-3.
Knights of Columbus Hall, 312 Franklin St., Marietta.
For more information or to RSVP: 1-800-331-2644.
Depending on the location, some prospectors are paying up to $3,000 per acre up front with promises of 12 to 18 percent in royalties.
Traditionally, oil and gas leases have paid as little as $10 per acre and about one-eighth in royalties, a local attorney said.
"I'm working with a guy right now (in Washington County) who has been contacted by the oil companies who are talking about paying that kind of money," Jurin said. "They're wanting him to get a bunch of neighbors together to make a bigger package."
In recent years, some drilling companies have developed new techniques that enable to them to reach and unlock the gas sources in the shale formations, which run from 8,000 to 15,000 feet below ground.
As a result, there is increased competition between companies to secure drilling rights. Most of the activity right now is in western Pennsylvania and eastern Ohio and some nearby West Virginia counties, said Tracey Wright, Washington County Recorder.
"We haven't been seeing a lot of new leases, but we do have people in here almost daily researching where there is land that can be acquired," she said.
Tom Stewart, executive vice president of the Ohio Oil and Gas Association, said he would urge Washington County landowners to do their homework and never sign a contract without consulting with a qualified attorney.
"This is not like buying and selling stock on the exchange," Stewart said. "You can't open the paper or go to the Internet every day and read what prices are. It takes a little more research to see what is happening and how it applies to you."
Stewart said offers for leases will vary based on land features and what is actually produced when wells are tapped.
Attorney Jim Huggins, of Marietta, has worked with oil and gas leases since the early 1980s. He said the frequency of inquiries by landowners at his office is up considerably in recent months.
"It's hard to say exactly how much it's up, but what I can say is that the leases I'm looking at have never offered as much."
In addition to reviewing the financials of a lease, Jurin said landowners should take into consideration if there needs to be limits on drilling on their property.
"My understanding is that they need five to 10 acres to set up and do their drilling," he said. "People need to take into consideration their farming production, plans for buildings and accommodation for water."
Huggins said landowners can put provisions in a lease that restrict drilling sites, if desired. He also suggested working with companies who have been in business for some time and have a proven track record.
