STEUBENVILLE - The local effects of gas speculators and leases related to exploitation of the Marcellus shale were discussed during the Friday luncheon meeting of the city Rotary Club at the YWCA.
Attorney Larry Piergallini told members he believes Jefferson County will eventually see an influx of capital related to gas speculators attempting to lease gas rights from county landowners - but not immediately.
"I think we're going to see some activity and bring in money to Jefferson County," said Piergallini, adding speculators currently are actively trying to lease gas rights from county landowners. "But it's not going to happen right away or even in two or three years."
SHALE?TALK — Attorney Larry Piergallini discussed leases for gas rights related to the Marcellus shale speculation in Jefferson County during the Steubenville Rotary Club’s Friday luncheon meeting at the Steubenville YWCA.
Piergallini said the Marcellus shale is a geological formation stretching for several states which contains gas.
"The shale is about a mile deep," he said. "It's a shale gas. We are in the shale gas region."
Piergallini said geologists and mineralogists have known about the shale and the gas for decades, but the technology wasn't available to bring it to the surface.
"The gas is in the rock," he said, adding a recently developed drilling technique enables water and chemicals to be forced into the crevices of the rock, which in turn forces the gas to the surface.
Piergallini said the technique known as horizontal fracturing is the only drilling technique that is economically feasible for speculators and gas companies.
"Of the dozen or so wells that have been drilled in Jefferson County so far, not one of them has been a horizontal well," he said, adding many of the county wells currently are capped.
Piergallini said two of the speculative companies in the past trying to lease rights from Jefferson County landowners were offering "cheap leases. They also didn't probably have the the resources to drill a horizontal well. (Previous capped wells in the county) will eventually be horizontally drilled."
Piergallini said two larger companies with more resources currently are trying to lease gas rights from some in the county.
One obstacle to possible drilling includes a lack of gas pipelines and networks in the area, said Piergallini. He added some companies will probably invest in lines because of Jefferson County's proximity to several large urban areas in the eastern United States.
"It's going to happen," he said. "(The gas drilling companies) are spending large amounts of money for this."
Piergallini said those landowners negotiating leases with gas speculators for drilling rights should use caution.
"You know the lease is going to be favorable to the gas company," he said, adding "they are in it to make money."
He said there are several factors for a landowner to consider, including how much property drilling operations will require, how close drilling will be to residences, whether the landowner actually owns the mineral rights and property and easement rights and taxes paid on any windfall a landowner may receive.
"These leases are usually negotiable, but a landowner isn't going to get everything they want," said Piergallini. "This will make some (with land) wealthy people in Jefferson County. But this project will take more than five years."
(Miller can be contacted at firstname.lastname@example.org.)