Author Archives: Sacord

New Division of Soil and Water Factsheet: Water Withdrawal Regulations for Oil and Gas Drilling

Click to view a PDF

Fresh water is a critical component for the drilling and development of Ohio’s oil and gas resources. Water is used for support purposes, such as dust control on access roads and equipment cleaning; drilling operations for making drilling fluids and the cement used for securing casing in the bore hole; and for well stimulation processes such as hydraulic fracturing.

In most cases, between two and six million gallons of water are needed to complete hydraulic fracturing on a Marcellus or Utica shale well. Drilling and hydraulic fracturing of deep shale wells is in its early stages in Ohio, but all indications are that oil and gas development from shale will expand in the next few years. With the expansion of deep shale drilling, the need for reliable water supplies will expand at an equal pace.

To assist oil and gas drilling companies with understanding the regulations governing withdrawal and use of water in Ohio, the following provides general information regarding water rights, water withdrawal regulations, diversions of water across the Lake Erie – Ohio River watershed divide, and consumptive use of water.

Water Rights in Ohio
In Ohio, land owners have the right to make reasonable use of ground water underlying their land or of the water in a lake or watercourse located on or flowing through or along their riparian land. This right to a reasonable use is a property right protected by Article 1 Section 19b of the Ohio Constitution. Withdrawals that unreasonably interfere with the withdrawals of other land owners using the same stream or aquifer may be subject to liability via civil litigation.

Water Withdrawal Registration
Section 1521.16 of the Ohio Revised code requires any owner of a facility, or combination of facilities, with the capacity to withdraw water at a quantity greater than 100,000 gallons per day (about 70 gallons per minute) to register such facilities with the Ohio Department of Natural Resources Division of Soil and Water Resources. It is important to note that the law requires registration if a facility has the capacity to withdraw 100,000 gallons per day even if a lower volume is actually withdrawn. Registration under this program is not a permit to withdraw water, nor does registration impose any restrictions on withdrawals. Withdrawal registration requirements pertain to all of Ohio.

Diversion of Water from the Ohio River Drainage Basin into the Lake Erie Drainage Basin

Ohio Law (ORC 1501.32) requires a permit, issued by the Director of the Department of Natural Resources, to divert more than an average of 100,000 gallons per day, over any 30-day period, out of the Ohio River drainage basin into the Lake Erie drainage basin. Diversion as applied in this section means the transfer of water from the Ohio River drainage basin to the Lake Erie drainage basin.

Diversion of Water from the Lake Erie Drainage Basin into the Ohio River Drainage Basin


The Great Lakes –St. Lawrence River Basin Water Resources Compact (Compact), a binding agreement among the eight states that border the Great Lakes, which has been enacted into Ohio law and carries the force of Federal law, specifically prohibits (with very limited exceptions) any new or increased diversion of any amount of water out of the Lake Erie drainage basin. Therefore, no permits for the transfer of water out of the Lake Erie basin for oil and gas operations, or other types of operations, are allowed.

Consumptive Use of Water
No facility may have a new or increased consumptive use of more than 2 million gallons of water per day, averaged over any 30-day period (60 million gallons per month), without first obtaining a permit from the Director of the Department of Natural Resources (ORC 1501.33). Consumptive use as used in this law, means a use of water resources, other than a diversion, that results in a loss of that water to the basin from which it is withdrawn and includes, but is not limited to, evaporation, evapotranspiration, and incorporation of water into a product. For oil and gas operations, this could include the incorporation of water into drilling fluids and hydraulic fracturing fluids.

Prior Notice and Consultation Requirement of the Compact
In December 2013 and thereafter, the Compact requires all Lake Erie basin proposals for new or increased consumptive uses of 5 million gallons per day or more, averaged in any 90-day period (450 million gallons or more in a three month period), to be submitted to the eight Great Lakes States and the Canadian provinces of Ontario and Quebec for review and comment.

Information contained in this fact sheet was obtained from ODNR, Division of Soil and Water Resources files, the publication entitled Ohio Conservancy Districts, (ODNR-DW, 1975), ORC Chapter 6101, the Ohio Conservancy District Conference, and the directors or staff of Ohio’s conservancy districts.

For more information, contact the ODNR-SWR by:

Phone: 614-265-6610
Fax: 614-265-6767
E-mail: dswc@dnr.state.oh.us

A pdf of the fact sheet can be found here: http://www.dnr.state.oh.us/Portals/7/pubs/pdfs/fctsht68.pdf

State Rep. Okey Introduces Truth in Leasing Act

Posted: Mar 26, 2012 10:30 AM EDT
Updated: Mar 26, 2012 10:30 AM EDT

COLUMBUS,Ohio –
State Representative Mark D. Okey introduced today his “Truth in Leasing” bill to protect Ohio’s landowners against fraud, abuse, and deceptive practices by the oil and natural gas industry.

“We need to make sure that drilling in Ohio is conducted safely and fairly for all parties involved,” Rep. Okey said. “Far too many landowners are deceived into signing leases that deny them the compensation and accountability that they are entitled to.”

According to a press release, The Truth in Leasing Act will include provisions in three main areas: fairness, honesty, and accountability. Minimum royalty payments will be set at a level that reasonably compensates landowners for their resources, while prohibiting oil companies from using legal loopholes to take more than their fair share. Landowners would have the right to yearly audits – at the driller’s expense – to ensure that their royalty payments are accurate.

To guarantee an honest leasing process, the “landmen” who secure leases on behalf of drillers would be subject to a new licensing system. Before any lease is signed, landowners must be informed of their rights and encouraged to consult with an independent attorney to protect their interests.

Finally, companies would be held accountable for the consequences of drilling, by disclosing all chemicals and compounds used to the Ohio Department of Natural Resources, paying for the testing of local water supplies before and after drilling, and issuing public notification of any accidents or incidents related to drilling that may result in property damage or health risks.

“This is common sense legislation that will prevent exploitation of Ohio’s citizens and resources,” Rep. Okey said. “More and more leases are being signed every day. It is imperative to move quickly to protect as many landowners as possible.”

Rep. Teresa Fedor (D-Toledo) will be a joint sponsor of the bill.

 

Link to Original: http://www.wtrf.com/story/17254675/state-rep-okey-introduces-truth-in-leasing-act 

Extension Educator Says: Shale payments subject to Ohio’s Commercial Activity Tax

Landowners across Ohio may be surprised to learn the bonus lease and royalty dollars received for their Marcellus or Utica Shale leases will be subject to theOhio commercial activity tax (CAT) if payments of over $150,000 are received.

What is it?

The CAT was enacted in House Bill 66, which was passed by the 126th General Assembly in 2005. The CAT is an annual tax imposed on “the privilege of doing business in Ohio,” measured by taxable gross receipts from most business activities.

Most receipts generated in the ordinary course of business are included in a taxpayer’s CAT base. This tax applies to all types of businesses: e.g., retailers, service providers (such as lawyers, accountants, and doctors), manufacturers, and other types of businesses.

The CAT applies to all entities regardless of form, (e.g., sole proprietorships, partnerships, LLCs, and all types of corporations). The tax does have limited exclusions for certain types of businesses, such as financial institutions, dealers in intangibles, insurance companies and some public utilities if those businesses pay specific other Ohio taxes.

A person with taxable gross receipts of more than $150,000 per calendar year is subject to this tax, which requires such person to register with the Department of Taxation as a taxpayer.

The term “gross receipts” is broadly defined to include most business types of receipts from the sale of property or in the performance of a service. Please note that certain receipts are not taxable receipts, such as interest income.

The following are some other examples of receipts that are excluded from a taxpayer’s CAT base: dividends, capital gains, wages reported on a W-2, interest (other than from credit sales), or gifts.

 

Oil and gas income

Internal Revenue Code section 1231 provides guidance on why the oil and gas receipts are included in a taxpayer’s CAT base. Specifically, the Code states that timber, coal, and iron ore are considered property used in the trade or business, assuming they are contained in the ground.

Once the mineral is removed from the ground, however, it is no longer an asset used in the trade or business, and therefore receipts from the sale of this mineral are included in a taxpayer’s CAT base.

$150 and 0.26%

 So what are the tax rates for the CAT? The rate for the first $1 million in taxable gross receipts (from $150,000 to $1 million) is a flat $150. The rate for receipts above $1 million is 0.26 percent.

The $150 annual minimum tax is due by May 10 of each year with the annual tax return for calendar year taxpayers or with the first quarter return for calendar quarter taxpayers.

A calendar year taxpayer who will have over $1 million in taxable gross receipts for a calendar year is required to switch to a quarterly taxpayer in the subsequent year and, if it elects to, can switch to a quarterly taxpayer at any time during the current calendar year.

CAT Example

 John B. Landowner owns 400 acres in northeastern Ohio and is a teacher at the local high school. He leases his land for $3,000 per acre, which totals a bonus payment of $1.2 million. To calculate his CAT obligation, Mr. Landowner would pay $150 for the first million dollars and then apply the .26% tax rate for the remainder ($200,000), which equals $520.

He has no other commercial business activity so his total CAT obligation would be $150 + $520 =$670.

Link to original: http://www.farmanddairy.com/news/shale-payments-subject-to-ohios-cat-tax/35664.html

 

ABOUT THE AUTHOR 

David Marrison is an agricultural extension educator in Ashtabula County.

E-mail: marrison.2@osu.edu

Thanks for your Support!

Last night http://www.lookbeforeyoulease.org crossed over 10,000 “hits”. This is great news,being that the site is less than 6 months old. We thank you for your support of Look Before You Lease and for sharing links, articles and our toolkit with your friends and family.

We are also grateful that so many landowners in Ohio, and elsewhere (we have distributed toolkits to landowners, attorney’s, and community leaders in 6 states) are choosing to do research and learn about shale development and leasing issues before deciding whether to lease their property.

We will keep on keeping on, but for now we just wanted to say Thank You!

Athen’s County: Lease situation gives signers more time to reassess situation

A letter to the Editor of the Athens News that mentions “Look Before You Lease”. Thanks to Bob Sheak for helping us to spread the word about the importance of information based decision making around shale development. We don’t know how this will play out in Athens county, but there is a renewed urgency for those who are in the position to extend their lease agreement to review our landowner toolkit and and learn about the other groups mentioned in Mr.Sheak’s letter before making the decision to extend, work out additional terms, wait and see how the first wells produce, or wait for results from studies currently being conducted by federal agencies before making a final decision. If you have a neighbor or friend who is in the group awaiting payment from Cunningham, or is thinking about leasing through another landowner group make sure they have visited our site, or request a landowner toolkit for them. We will send a CD version by mail.

To the Editor:

This Cunningham Energy decision not to sign the oil and gas leases aggregated by local attorney John Lavelle illustrates how little control Athens Countians have in such matters, even with legal advice. Low natural gas prices, too much supply, a moderate winter, perhaps new questions about how to dispose of wastewater — all may help to explain why Cunningham has had trouble finding a corporate partner prepared to share the costs of shale gas/oil mining and to take responsibility for the various operational aspects of such mining.

Groups and individuals such as Look Before You Lease, SD-Frac, Sierra Club, Heather Cantino, Christine Hughes and their many strong allies, letter writers, and others in Athens have worked hard to educate local officials and the general population about the extensively documented dangers of shale gas mining. According to a student-driven poll of over 350 mostly Athens County residents reported Monday in The Athens NEWS, about half of the respondents opposed the option of going ahead with fracking until there are adequate safety regulations in place. My guess is that, despite the economic recession that still rages, the number is this high because of the educational efforts of the aforementioned groups.

I also guess that when, for example, natural gas prices rise and the infrastructure to move the gas is in place, Cunningham will find a corporate partner to commence the drilling in Athens. There are not many large economic alternatives available now for new public investments, publicly supported projects, or a significant shift to solar or wind energy. And the low-or-no tax and small-government policies of Republicans seem to resonate powerfully with a large number of citizens across Ohio and the U.S. So, if there is oil or gas in our part of the Utica shale formation and it can be profitably extracted, the mining corporations will be back.

In the meantime, from the perspective of about half of Athens County, there is some welcome additional time for residents to learn and think about and perhaps see implemented (to some extent) more adequate regulations than now exist. Though we probably should not count on much regulatory assistance from Ohio Gov. John Kasich and the Republicans at the state level. At the state level, with Kasich at the helm, we may well end up unfortunately looking more like Pennsylvania (very supportive of gas/oil shale mining) than New York (which continues to postpone final decisions on the acceptability of shale-gas mining).

Bob Sheak
Athens

(A-news) Editor’s note: Though this won’t be known until actually drilling begins in this area, some geological experts predict that the main “play” in Athens County and the surrounding area will be for oil rather than “dry” natural gas. Currently, natural gas prices are depressed while oil prices are relatively high. TS

 

Link to original Article: http://www.athensnews.com/ohio/article-36389-lease-situation-gives-signers-more-time-to-reassess-situation.html

New Presentation Posted: Ohio Department of Natural Resources – Geological Survey

A new presentation (PDF of a powerpoint) has been posted on ODNR’s website. The authors of the presentation are: Larry Wickstrom, Chris Perry, Ron Riley, and Matthew Erenpreiss. Within the presentation there are some new maps of the Utica-Point Pleasant shale play, aswell as information about unit sizes and examples of where a well pad might be located within a unit. There is also information about a proposed wet gathering system for Ohio

See the presentation here: http://www.ohiodnr.com/portals/10/energy/Utica-PointPleasant_presentation.pdf

Harrison County: Judge’s Ruling Limits Shale Developers Drilling Rights

By Alison Grant – The Plain Dealer

CADIZ, Ohio — Sparsely populated Harrison County, in the rolling foothills of the Appalachians, boasts a rich vein of U.S. history.

The county was a hotbed of abolitionist activity in the years leading up the Civil War. It’s where General George Armstrong Custer and Edwin Stanton, President Lincoln’s secretary of war, were born. And on Charleston Street, in the county seat of Cadiz, is a two-story, white frame house that is the birthplace of actor Clark Gable.

In recent years though, Harrison County has been out of the spotlight, but a judge’s ruling could change that.

Harrison County Common Pleas Judge Michael Nunner has sharply limited Chesapeake Exploration’s ability to drill for shale gas and oil from a property where the company has leased the mineral rights. The ruling is rattling an industry that Cleveland State University economists predictcould pump $5 billion a year into the state’s economy by 2014.

12FGSHALEMP.jpg

“It could affect Chesapeake and other drill companies across Ohio,” said David Hudson, who represents the Jewett Sportsmen and Farmers Club, the landowner that sued Chesapeake.

Nunner said while Chesapeake can vertically extract gas and oil from underneath the hunt club’s 187 acres of woods and fields, the energy company can’t use the land to drill sideways to get at reserves from adjacent land.

He ordered Chesapeakea dominant player in Ohio’s shale production, to stop horizontal drilling that extends beyond Jewett’s property line unless it gets the club’s permission to go ahead.

Extracting natural gas and oil from shale formations depends on lateral drilling to carry millions of gallons of water under intense pressure to fracture surrounding rock. Horizontal bores can extend up to 10,000 feet, or almost two miles, from the drill hole. Chesapeake already had poured a 12-acre concrete pad for rigs but has sunk no wells.

“They don’t have a right to come in and destroy our surface without fair compensation,” said Jewett club president John Harris.

A spokesman for the Oklahoma-based Chesapeake declined comment. So did North American Coal Co., which owns the mineral rights and leased them to Chesapeake.

12FGSHALE.jpg

The coal company, in a motion earlier this month, asked Nunner to reconsider his order that effectively halted Chesapeake’s ability to profitably plumb the shale rock some 8,000 feet below ground.

North American Coal, in its motion, said that the order directly conflicts with Ohio public policy to encourage development of natural resources “by halting any oil and gas production through the use of contemporary horizontal drilling methods on this property.”

By creating an “erroneous new law, it would impede or prevent the development of oil and gas elsewhere in Ohio, with significant adverse effects for the state’s economy,” the company said.

Harris said the club’s 190 members are about evenly divided between those looking for a good settlement from Chesapeake in exchange for their approval on drilling and those wanting the company to go away.

The club, in the center of Harrison County, about seven miles north of Cadiz, dates back to 1959 when its 12 founders took out a bank loan to buy a chunk of land they were leasing to hunt white-tailed deer, jackrabbits and wild turkey.

“It makes us a unique piece of property because there’s no houses around,” Harris said. “We’re sitting right there in the middle of nowhere.”

Members today raise money by renting out a lodge for wedding and graduation parties, throwing annual corn roasts and raffling off all-terrain four-wheelers. They spend about $1,000 a year stocking three lakes at the club with bass, blue gills and crappies.

After Nunner blocked horizontal drilling, Chesapeake approached Harris about starting from square one and working out a deal.

“We sent our (monetary) demands and have not heard another word since,” Harris said. He would not elaborate on the proposed settlement.

North American Coal deeded the land to the club in 1959, said Gregory Brunton, a lawyer for the Cleveland-based Reminger law firm that represents the club.

Coal companies across eastern Ohio often sold off surface real estate when they were done mining. But those companies held on to the underground mineral rights in case they wanted to go back in and take out more coal, or oil and gas.

Ohio law says owners of such “severed” mineral interests have a right to “reasonable” use of the surface to get at the minerals.

Brunton said the club’s deed didn’t anticipate shale gas extraction — which requires not only long horizontal wells, but also large well pads with multiple wellheads on each, storage tanks on site, and convoys of trucks hauling in millions of gallons of water.

The Jewett lawsuit is one of the latest legal fights shaping up over shale gas drilling in Ohio.

In a separate lawsuit filed this month, 33 landowners in Columbiana County contend that land men concealed or actively misled them about how much surface and below-ground disruption was involved in shale gas extraction. And in Akron, Chesapeake sued 95 landowners in January for attempting to get out of their leases and sell them to another bidder.

In this latest case, Reminger attorneys representing the sportsmen’s club have been fielding calls from other lawyers who wonder about the impact of the Harrison County case on the landowners they represent.

If Jewett Sportsmen and Farmers Club and Chesapeake can’t settle their dispute, the case is expected to go to trial on the club’s claim that Chesapeake trespassed on its property.

“It may have potentially wide ramifications,” said Brunton, who considers the case precedent-setting in Ohio.

Link to Original Article: http://www.cleveland.com/business/index.ssf/2012/03/judges_ruling_limits_shale_dev.html

Open forum on oil and gas leases at Ohio University-Chillicothe set for 2 p.m. Tuesday

CHILLICOTHE — Ohio University-Chillicothe will seek input from campus faculty, staff, students and the public regarding a potential lease of Ohio University Chillicothe Campus land for oil and gas production at 2 p.m. Tuesday.

The forum is being conducted in accordance with Ohio House Bill 133, which requires public universities in Ohio to conduct an inventory of all properties to determine their eligibility for potential oil and gas leasing.

Speakers will be asked to sign in and will be allowed three to five minutes to speak. The forum is an opportunity to provide input; it is not a debate. Notes will be taken, and written comments will be collected. All comments will be compiled for presentation to the Ohio University Board of Trustees.

Cunningham Energy seeks to postpone lease bonus payments, attorney says

Posted: Sunday, March 11, 2012 5:56 pm | Updated: 7:16 am, Mon Mar 12, 2012.

By STEVE ROBB Messenger staff journalist

It is “very unlikely” that Cunningham Energy will be able to meet Thursday’s deadline for making lease bonus payments to Athens County landowners, but the company is seeking a time extension, according to an attorney who has negotiated oil and gas leases for hundreds of local property owners.

Attorney John Lavelle sent his clients a letter Friday updating them on the situation. Contacted Saturday by The Messenger, Lavelle declined to comment. However, The Messenger obtained a copy of the letter from a landowner.

Lavelle has said previously that he has negotiated about 500 leases with Cunningham for local property owners that include signing bonuses of $2,500 per acre for drill leases and $1,250 per acre for non-drill leases. Lavelle has said the bonuses for his clients total more than $100 million. Payment of the bonuses by this Thursday was required in order for the leases to take effect. The leases also call for payment of a 16 percent royalty.

“It is very unlikely the leases will be funded by March 15, 2012. The agreements will therefore expire by their own terms,” Lavelle writes in the Friday letter.

However, Lavelle also writes that Cunningham has presented the lease package to more than 130 “of the largest companies in the world” and is currently in “intense negotiations” with a joint venture partner which are expected to result in a purchase and sale agreement within the next seven to 10 days, with a closing within 45-60 days thereafter.

At a lease signing event last November at the Athens County Fairgrounds, Cunningham land manager Joseph Blackhurst said his company has only conducted vertical drilling in the past and that a joint venture partner working with Cunningham would be the one doing any horizontal drilling.

At the time, Blackhurst would not disclose the name of the joint venture partner, but said it is a well-known publicly traded company.

Lavelle’s letter, though, indicates that an agreement has not yet been reached with a partner.

Lavelle says in the letter that he was approached about extending all the lease agreements to May 18.

“I explained it would be a daunting task to secure the consent of over 500 lessors in a short time frame, but we would do everything possible to extend this opportunity to those who desire to participate,” Lavelle writes.

In exchange for the time extension, Cunningham has agreed to increase the 16 percent royalty to 16.5 percent, according to the letter.

Lavelle also provided his client with an amendment, developed by a Cunningham attorney, to extend Thursday’s deadline to May 18. The letter instructs the clients to return the signed document by Thursday in order to continue to be part of the lease proposal.

According to an affidavit that Blackhurst filed in the Athens County Recorder’s Office last December, Lavelle has a lease agreement with Cunningham for 362 acres of his own property.

“My wife and I plan to sign the amendment concerning our own acreage,” Lavelle says in Friday’s letter. “We play to stay with it until the conclusion.”

Link to Original Article: http://www.athensohiotoday.com/news/article_163c4ff4-6bc5-11e1-bfa8-001871e3ce6c.html

Press Release From Governor Kasich’s Office: ODNR Releases Preliminary Report on Youngstown Area Seismic Activity

COLUMBUS, OH – Ohio’s oil and gas regulators today announced new environmentally responsible standards for transporting and disposing of brine, a by-product of oil and natural gas hydraulic fracturing. The new regulatory framework makes Ohio’s rules for brine monitoring and disposal among the nation’s toughest. The Ohio Department of Natural Resources (ODNR) developed the new regulations after researching the link between a series of seismic events in the Youngstown area and a brine disposal well.

The new safeguards: prohibit any new wells to be drilled into the Precambrian basement rock formation; mandate operators submit extensive geological data before drilling; and implement state-of-the-art pressure and volume monitoring devices including automatic shut-off switches and electronic data recorders. In addition, ODNR will require that brine haulers install electronic transponders to ensure “cradle to grave” monitoring of all shipments.

“Ohio has developed a new set of regulatory standards that positions the state as a national leader in safe and environmentally responsible brine disposal,” said ODNR Director James Zehringer. “Ohioans demand smart environmental safeguards that protect our environment and promote public health. These new standards accomplish this goal.”

The new safeguards will be added to Ohio’s existing disposal well regulatory framework. The regulations will apply to new Class II disposal well permit applications and to existing disposal wells, if applicable. Ohio regulates Class II disposal wells on behalf of the U.S. EPA. In 1983, the U.S. EPA gave Ohio regulatory authority over its Underground Injection Control program because the state’s disposal well regulations met or exceeded U.S. EPA standards.

The comprehensive list of proposed new regulations includes:

  • Requires a review of existing geologic data for known faulted areas within the state and a prohibition on locating new Class II disposal wells within these areas;
  • Requires a complete suite of geophysical logs (including, at a minimum, gamma ray, compensated density-neutron, and resistivity logs) to be run on newly drilled Class II disposal wells. A copy of the completed log, with analytical interpretation, will be submitted to ODNR;
  • Authority for ODNR to require the plugging with cement of wells penetrating into the Precambrian basement rock and prohibiting injection into the Precambrian basement rock;
  • Requires the submission, at time of permit application, of any information available concerning the existence of known geological faults within a specified distance of the proposed well location, and submission of a plan for monitoring any seismic activity that may occur;
  • Evaluates the potential for conducting seismic surveys;
  • Requires a measurement or calculation of original down hole reservoir pressure prior to initial injection;
  • Requires conducting a step-rate injection test to establish formation parting pressure and injection rates;
  • Requires the installation of a continuous pressure monitoring system, with results being electronically available to ODNR for review;
  • Requires the installation of an automatic shut-off system set to operate if the fluid injection pressure exceeds a maximum level to be set by ODNR; and
  • Requires the installation of an electronic data recording system for purposes of tracking all fluids brought by a brine transporter for injection.

All of the reforms will be considered during the permitting process for new Class II disposal wells and will be implemented as attached permit conditions until they are either codified in law or written into administrative rule, which carries the weight of law.

ODNR also released a preliminary report on the relationship between the Northstar 1 Class II disposal well and 12 Youngstown area earthquakes.

Geologists believe induced seismic activity is extremely rare, but it can occur with the confluence of a series of specific circumstances. After investigating all available geological formation and well activity data, ODNR regulators and geologists found a number of co-occurring circumstances strongly indicating the Youngstown area earthquakes were induced. Specifically, evidence gathered by state officials suggests fluid from the Northstar 1 disposal well intersected an unmapped fault in a near-failure state of stress causing movement along that fault.

All of the conditions associated with induced seismic activity are addressed in Ohio’s new well permitting and construction regulations.

According to the U.S. EPA, more than 144,000 Class II disposal wells inject more than two billion gallons of brine every day in the United States. The U.S. EPA considers the deep injection of brine using Class II disposal wells as the preferred and environmentally safe method for disposal of oilfield fluid wastes. Prior to Class II disposal wells in Ohio, brine was stored in surface pits with harmful environmental results.

The report’s executive summary is available here. The full report is available here. The FAQ document is available here.


For more information, contact:
Carlo LoParo, ODNR Office of Communications
614-265-6860