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June 10, 2008

Group: Get help with gas leasing

Farm Bureau event is first of three in four-county area

By Jake Palmateer

Staff Writer

The president of the Otsego County Farm Bureau is advising those approached by natural gas "landmen" to educate themselves before signing any leases.

A Farm Bureau-sponsored seminar held last week "went very well" and was a good first step toward forming a coalition of landowners to assist in educating each other, said bureau President Steve Sinniger.

Similar coalitions have been formed in Broome and Chenango counties.

About 300 farmers and landowners from Otsego, Chenango, Delaware and Schoharie counties attended the seminar, Sinniger said, and were mainly interested in hearing about how to bargain for a better price, as well as the legal aspects of signing a lease.

But Sinniger said attention also needs to be paid to some of the environmental issues related to natural gas drilling.

Similar seminars are scheduled in the area for this Thursday and next Tuesday, June 17.

The Marcellus shale formation lies mainly in New York, Pennsylvania, West Virginia and Ohio and can run as deep as 7,000 feet. Natural gas lies trapped within the shale, and although its existence has been known for about 100 years, recent developments in technology and the high market price of national gas have renewed interest.

Some scientists have estimated there could be as much as 500 trillion cubic feet of gas trapped in the shale.

Landmen from several mining companies are frequenting the area, looking for sites to drill wells and signing leases with some area landowners.

The going rate for leases varies from $25 to $2,400 an acre, according to Sinniger.

Because of the difference in lease rates, Sinniger said, the Farm Bureau wants to make sure people are getting a fair deal.

"You might want to get some legal help before signing a lease," Sinniger said.

Attorneys who would work on behalf of landowners could be expected to charge $20 to $50 an acre to bargain with a mining company, Sinniger said.

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