Ohio law to ease restrictions on oil and natural gas drilling

With the price of crude oil climbing near record highs, oil companies are working overtime to find new places to drill for black gold. Soon, they will have an easier time setting up drilling equipment on fields, farms and even upscale neighbourhoods across Ohio.
In September, a new state law will take effect that rolls back years of local restrictions on oil and natural gas drilling in cities and townships across the state. In the past, many local governments set up lengthy reviews, and reserved the right to say no if neighbours objected, or if officials were concerned with safety and health issues. Some cities, such as Tallmadge, even banned drilling outright.

All those restrictions will disappear on Sept. 16, when the law gives exclusive authority for regulating and siting wells to the Ohio Department of Natural Resources. That will almost certainly reverse the 20-year decline in drilling in Ohio, opening access to some areas of the state for the first time in more than a decade.
Supporters of the law, including drillers and some landowners who want to cash in on oil and natural gas on their property, say the change is overdue. They say the past restrictions were excessive and amounted to a classic example of the "not in my back yard" syndrome.

"People want to have energy, and they complain about gasoline prices, but they want to preclude companies from being able to drill and produce more oil," said Brian Carr, president of Maverick Oil & Gas, which operates about 20 wells in Summit County. He plans to drill about 20 more wells here within the next six months, after the restrictions are lifted.
But critics say the law could lead to a stampede of new drilling in neighbourhoods or in unspoiled areas. They say the noise, dirt, smell and possible safety hazards of drilling outweigh the benefits.
"It's the wrong thing to do," said John Moore, Akron's zoning inspector. "This should be left in the hands of local people to decide on a case-by-case basis, based on how it affects the surrounding neighbourhoods."

Ohio traditionally has been one of the most active states in the nation for drilling, with more than 250,000 wells drilled since the 1850s. But in recent decades, that number has been dropping. In 1985, the peak year for drilling in Ohio, developers drilled about 5,800 new wells throughout the state, including more than 300 in Summit County. By last year, that figure had dropped to 508 new wells state-wide, and only seven in Summit County.
The Ohio Oil and Gas Association, an industry trade group based near Columbus, said it expects the number of new wells to increase by up to 20 % a year after the restrictions are lifted.

The group said oil and natural gas wells are not the noisy, smelly contraptions that many people imagine. Wells can be drilled in about a week, and the property restored to its previous appearance, within about 60 days, with the exception of the above-ground well apparatus.
Wells can be found nearly everywhere. They are on church yards,open fields, golf courses and urban developments. There are more than 200 active wells in the city of Akron alone.

One of Carr's wells in Copley Township is just 100 yards or so from an apartment building across the field. Another sits just a few feet from a playground and swimming pool at the Windsor Park Estates, an upscale apartment complex in Copley.
"It's quiet. It's not hurting anyone. You can barely see it from most of the apartments," Carr said, as he inspected the well near Windsor Park.

Oil and gas wells might not be pretty. But they are necessary in today's society, industry officials say.
"This is not like having a porn shop or a pizza place that you don't like," said Tom Stewart, the association's executive vice president. "This is an essential energy-producing activity. Everyone uses oil and gas. You power your homes, your factories, your cars. Hundreds of products are made with it. It's the energy force behind our modern society."

But some people say the drilling and pumping doesn't belong in their neighbourhoods. Last year, Everflow Eastern floated a plan to drill an oil and gas well along West Market Street, behind what is known as the Galt mansion. It had won the support of many surrounding neighbours.
But another band of neighbours quickly rose in opposition, and collected more than 250 signatures against the plan. They pointed out that some of their homes would sit about 300 feet from the proposed drilling site. They said the well would impose needless risks for 50 children in the neighbourhood. They persuaded Akron City Council to reject the plan.
"The neighbourhood was overwhelmingly opposed to it," said David McGrew of nearby Mayfield Avenue. "I think it was right for the local community to have a say."

But after Sept. 16, Akron won't have a say, and the developer could be free to move ahead with his plans. He only needs to win the approval of the state, not the city or neighbourhood. Under state law, any well over 4,000 feet deep requires the approval of all landowners within 40 acres. The drilling site must be at least 100 feet away from the nearest occupied structure.
That's the bare minimum, with no further local restrictions allowed. That will be a rude shock for Tallmadge, which has banned drilling since 1991.
"It looks like we'll have very little opportunity to limit drilling now," Tallmadge Law Director Penny Baker said. "It will be up to some jurisdiction to challenge the constitutionality of this law."

Officials in Bath Township, too, are bracing themselves for a possible influx of new drilling. In the past, the township would hold hearings to let neighbours comment upon drilling proposals. After September, the township will have little power to do anything.
"Obviously, with the price of oil going up, there's a renewed interest in drilling," said William Snow, Bath Township administrator. "There are certain areas that are still drillable. We're concerned about fire exposure and possible contamination to water wells."

But drillers say those fears are unfounded. Joel Rudicil, a partner with Bass Energy in Akron, which operates more than 100 wells, said none of his wells have ever caught fire, exploded or contaminated nearby wells.
He said he is already negotiating agreements with property owners around the area to drill once the state law takes effect. And he says he has an unspecified number of contracts already in hand.

What does a property owner get out of saying yes? Typically, a royalty equivalent to 12.5 % of all the oil and natural gas found and produced on the property. That varies from pocket change to several thousand dollars a month. Property owners can get enough free natural gas to heat an average-sized home, Rudicil said.
"Property owners still have the right to say yes or no as to whether they'd like to have a well drilled on their land," Rudicil said. "What this law does is give them a clear option to say yes or no. It's really a property-rights issue."