In Ohio, landowners are poised for a long-fought property rights win allowing for the safe development of oil and natural gas under the surface of state-owned lands through House Bill 507, passed by the Ohio House on Tuesday after the Ohio Senate’s approval last week.
Up until the passing of this amendment, private landowners close to and adjacent to Ohio state lands and parks were unable to develop their adjacent private minerals. Once this legislation goes into effect, landowners will be able to safely lease and develop Ohio’s energy-rich natural resources – over ten years after fracking was enshrined in state law.
Energy in Depth has covered Ohio’s long saga with landowners attempting to be able to develop their mineral rights adjacent to public lands before. In 2011, Ohio’s General Assembly approved fracking under state lands, but development failed to take place. Then in 2017, former Gov. John Kasich passed a bill to establish the Oil and Gas Leasing Commission, an entity created to govern the process of shale gas development under state lands. However, that commission sat empty for years with no appointments made. Even after additional language was added last year to incentivize the commission, the rules were never promulgated, resulting in what can best be described as a de facto moratorium of state land shale development, and as a result, adjacent private landowners’ rights were held hostage.
Significant win for private property rights
With the passing of the amendment in HB 507, the Ohio Legislature made it clear once again that leasing state minerals is a priority for the people who elected them.
Dan Devitt, President of the National Association of Royalty Owners (NARO)-Ohio heralded the move:
“Appalachian Ohio contains a world class natural gas resource…Ohio’s landowners close to and adjacent State minerals have been stranded and denied an opportunity to participate in the development of their minerals prior to the related provisions in House Bill 507. Developing our natural gas resources ensures a reliable transitional energy source, energy security and the ability to support our allies.” (emphasis added)
Devitt goes on to explain, “even more important is the Bill’s provision allowing 30 percent of all oil and gas related income to go back to the State lands being leased.”
Partnerships between landowners and the local community are nothing new. In 2020, EID interviewed Belmont County Ohio farmer Larry Cain to discuss the natural gas development taking place in his county and on his family’s dairy farm. In addition to safe and successful fracking operations that both produce energy while protecting his family farm, Cain highlighted the immense benefits he and his landowner coalition were able to give back to the community due to that development:
“We’ve raised about $600,000 and given about $400,000 of that to communities. The way I’ve always looked at it is this area has always been a charitable area – even before oil and gas. We just didn’t have the money to give in the past, so we’d donate our time. But now that we have the money, we feel it is our responsibility…So that’s what we’ve done. We’ve given it to the county to help people because we wanted everyone to benefit.” (emphasis added)
In addition to these economic benefits, increased development of oil and natural gas is more important than ever as the United States and the globe grapple with continued energy shortages, high gas prices, and obstructed supply chains. To effectively address these challenges, policies that safely encourage the development of oil and natural gas production is key.
Bottom Line: After more than a decade, Ohio landowners adjacent to Ohio state lands and parks may soon begin to lease their lands to develop Ohio’s energy-rich resources. This, combined with a long history of the industry safely fracking and giving back to the community, is good news for Ohio landowners and good news for the Buckeye State.
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