Mouse Over to Stop Rotation & Read Ad

Monday, May 21, 2012

Carroll County Pipeline Activity Heating Up - Take a Closer Look

From Business Journal Daily:
CARROLLTON -- Doyle Hawk turns off busy Route 9 and noses his Ford F-150 down a narrow, gravel road that winds into the interior of Carroll County. After five minutes or so of navigating hill after hill, banked on both sides by endless trees and farmland, he stops at a clearing where a small white connection valve juts out of the ground.
“This connects the pipeline that runs through my property,” he says, pointing to a wide path of freshly dug earth that stretches over the horizon. For weeks, Hawk says, workers hired by Chesapeake Midstream LLC dug, foot by foot, miles of trenches and then set in place a seven-mile section of pipe that will become part of a massive superhighway for the oil and gas industry.
What’s happening here foreshadows what’s likely to occur in the next two to three years in Columbiana, Mahoning and Trumbull counties as energy and pipeline companies step up exploration and infrastructure development in the liquids-rich Utica shale.
Hawk, serving his fourth term as a Carroll County commissioner, says that pipeline companies began knocking on his door about a year ago as drilling began on the nearby West well.
He was among the residents who leased their land in 2010 to Patriot Energy Partners at $10 an acre and 12.5% royalties, only to find out later that Chesapeake Exploration LLC purchased the lease for more than $1,000 an acre. “It’s just one of those things,” he shrugs. Today, bonus payments have averaged between $3,000 and $5,000 an acre with 20% royalties. “Who ever knew this would happen?” he says.
Hawk recouped some of his upfront loss by leasing his easement rights to Chesapeake Midstream, which needed the right-of-way so it could to string a collection pipeline from the drilled wells.
The pipeline from the West well, Hawk says, runs almost two miles across his land, and the going rate is $15 per linear foot.
That figure would secure a one-time payment of $150,000 for Hawk and his family, who own some 600 acres. In all, the pipeline from the West well extends about seven miles, he says.
The line will also tie into other wells nearby in various stages of completion, Hawk reports. “I’d say there’s about 35 miles of new pipeline throughout the county,” he estimates.
Chesapeake Midstream, a subsidiary of Oklahoma City-based Chesapeake Energy Corp., is developing a vast network of gathering pipelines that will connect producing wells with processing centers in southern Columbiana County at the town of Kensington and in Harrison County. The processing complex is a $900 million project, in partnership with M3 Midstream/Momentum, to separate wet gas from dry gas and then send the product directly to ports on the Gulf of Mexico.
Read the entire article here.

Visit our Forum!

Connect with us on Facebook and Twitter!

No comments:

Post a Comment

Follow by Email