ST. CLAIRSVILLE - Belmont and Monroe County landowners, as well as natural gas and oil companies, hope the Ohio Department of Natural Resources will allow drilling in the liquids-rich Utica Shale formation to proceed.
However, a dispute regarding plans to conduct coal mining operations in these same areas may delay the drilling plans of companies like Chesapeake Energy, XTO Energy and Hess Corp. to drill on land they paid as much as $5,200 per acre to lease.
"Coal mining and oil and gas exploration have successfully worked side by side for many years," said Mike Carey, president of the Ohio Coal Association and a Belmont County native. "As long as there is early communication and planning, I firmly believe both industries can flourish in eastern Ohio."
Article Photos
Photo by Jennifer Compston-Strough
Murray Energy Corp. — parent company of American Energy Corp.’s Century Mine and Ohio Valley Coal Co.’s Powhatan No. 6 mine in southern Belmont County — is investing $77 million to build a new mine slope and preparation plant. Coal industry officials are having a dispute with natural gas companies over where gas wells and mine shafts will be located.
Carey and Thomas Stewart, executive vice president of the Ohio Oil and Gas Association, confirmed they are working with ODNR to ensure drilling and coal mining can both succeed in the eastern portion of the state. ODNR spokesman Andy Ware could not be reached for comment regarding the negotiations.
"We are hopeful these landowners who have signed leases will be able to see their minerals developed," Stewart said. "This is a major issue in your part of the state."
Exxon Mobil subsidiary XTO plans to drill its first Ohio Utica Shale well just south of the former Key Ridge Elementary School in Belmont County, state records show. The oil giant has at least 52,334 acres leased for drilling in Belmont and Monroe counties, with much of the acreage situated in areas where coal is also produced.
"XTO is a very fine company. You don't find them giving money to the Sierra Club to fight coal," Carey said, citing reports that other gas drillers gave millions of dollars to the environmental organization in an effort to hurt the coal industry.
"We just want the opportunity to lease our acres. With horizontal drilling technology, there should be minimal impact to coal operations," said Larry Cain, chairman of the Smith-Goshen Landowners Group, which is now entertaining lease offers from multiple companies, including XTO, Chesapeake and Hess. The group consists of about 800 individual landowners controlling about 47,000 acres in Belmont County, with most of the land located in the central portion of the county in townships like Smith, Goshen, Washington, Wayne, York and Richland.
Robert Edward Murray, vice president of business development and external affairs of Murray Energy, said in December, "Our coal ownership is superior to any oil and gas leases," adding that the company seeks to protect the "jobs we provide from indiscriminate drilling for oil and gas."
However, when asked to comment, Murray said, "Murray Energy is not in a dispute with any gas company whatsoever," noting the matter is a statewide and industry-wide issue.
Showing its commitment to provide coal jobs in eastern Ohio, Murray Energy is investing $77 million to build a new mine slope and preparation plant, a move company officials believe will allow them to employ 300 more workers.
Although Stewart said the two sides "have a ways to go on resolving this," Carey is much more optimistic.
"There are rare cases in which there is a disagreement between a coal operator and an oil and gas company," Carey said. "The cases of dispute are few and far between because all it takes is some communication and planning."