Landowners Struggling to Weigh Options with Limited Information
At 82, Jackie Pendleton is quite spry and shudders at the word “elderly.” Pendleton loves her five bedroom log cabin and 62 acres in East Rochester, a rural community in Columbiana County. Aside from her dog and two cats, Pendleton lives alone. Her health is stable, and she’s pretty comfortable here. But given her age, change is looming on the horizon.
Pendleton: “I don’t know how much longer I can live here by myself. My children are all in Canton and North Canton area, and I have a son that lives in Washington and my daughter lives in San Diego, and they are not planning to live with me.”
Pendleton has been thinking a lot lately about selling her property and moving closer to Canton. But exactly how much of it she should sell…that’s a big question mark, given the recent surge of interest in natural gas drilling.
Pendleton: “Oh, I have a stack of letters from people, from companies, from oil companies all over the country. They want to buy my mineral rights. But that would entail, I would be left with the property but no mineral rights.”
Mineral rights refers to the ownership of and the right to access minerals underneath the land. They’re connected to the land, until the owner decides to sell or lease them out.
Like many who live in Ohio’s eastern counties atop the Utica Shale formation, Pendleton is sitting on a supposed gold mine of natural gas. Over the past two years, companies like Chesapeake, Consol Energy, and BP have been swooping up buying acres of land or leasing the mineral rights where they hope to drill to reach the gas.
When companies approach landowners about leasing their land, they offer signing bonuses, and the promise that the landowners could reap ten to twenty percent of the royalties from the gas produced in the future. That makes the mineral rights quite valuable.
Exactly how valuable?
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