An awkward legal situation is unfolding on the city’s East Side, where a water utility company is asking 39 property owners at a subdivision near McKelvey Lake to lift land restrictions so that deep mineral rights can be accessed for oil and gas drilling.
The company’s request for the Mahoning County Common Pleas Court to clarify a provision in an 83-year-old warranty deed on the property has confused some residents. They fear their bucolic community and limited views of the lake could be compromised if a judge rules in the water utility company’s favor.
Though no controversy has surrounded the issue since the request was filed on July 2, it began to brew on Tuesday at a private meeting called by Youngstown Councilman T.J. Rodgers, who lives in the Beachwood Village Lakeside Estates subdivision.
Rodgers said he would prefer if the land restrictions were upheld, but said it is important to make sure everyone understands what’s going on at the subdivision, as the company’s request, forwarded individually to the 39 property owners in a court-issued summons between July 19 and 20, has created confusion.
Nearly 40 members of the community turned out Tuesday to voice strong opposition against any drilling in or around the subdivision.
Property owners said they felt “blindsided” by the company’s court filing and now they feel compelled to act against any potential drilling to preserve the tranquility of their community.
“The reason we picked this neighborhood to live in is because it doesn’t feel like Youngstown,” said Tyrone Peagler, who’s called Beachwood his home for eight years. “All we see is squirrels and deer — I like that. Now just because someone wants us to drill we have to go out and get a lawyer.”
Susie M. Ford, whose lived at Beachwood since 2004, gave a fiery speech at the Covelli Centre’s community room. “This doesn’t just affect Beachwood, it affects Youngstown,” she said to applause.
The subdivision is south of McKelvey Lake and west of Jacobs Road. Aqua Infrastructure, a subsidiary of Aqua America, which serves millions in nine states including Ohio and Pennsylvania, has leased a six-acre parcel north of the subdivision and south of McKelvey Lake to Youngstown-based Eric Petroleum Corp. Under the terms of the lease, no surface operations, such as drilling, would be permitted on the land, according to court documents.
Instead, the lease would allow any operator access to the deep mineral rights under the six acre parcel.
But in 1930, Aqua’s predecessor, the Ohio Water Service Co., acquired the parcel in question from a farmer who owned it. Included in the warranty deed — a document that transfers property from one party to another — were land restrictions that Eric Petroleum has asked Aqua to clarify, in order to resolve any problematic title issues in the future that could prevent access to the mineral rights.
Though the restrictions do not address subsurface mineral rights — instead providing for unencumbered access to the lake for domestic water, views, fishing and other bans on building on the property — Aqua fears that if they are not lifted, it will be unable to capitalize on the mineral rights it owns.
“We think the intention of the seller was to maintain a view of the lake,” said Alan Wenger, chair of the oil and gas law group at Harrington, Hoppe & Mitchell, which represents Aqua. “We recognize that the owners of the homes there now want to enjoy whatever rights were granted back then, but we don’t think it should keep the owner of the adjoining parcel from leasing the subsurface rights.”
Other landowners around the subdivision have leased property to oil and gas companies.
As far as he knows, Wenger said Eric Petroleum has no plans to develop the property in question. As a local outfit, which typically does not undertake costly horizontal hydraulic fracturing, or fracking, the company will most likely transfer the deep mineral rights to a larger operator if the land restrictions are lifted.
If that does happen, Wenger stressed that no drilling can take place on the six acres in the subdivision as the lease agreement bars it. Instead, any potential drilling operations would take place north of the property. Lifting the restrictions would allow any potential operator access to the deep mineral rights under those six acres and not under the homes of those living in the subdivision.
Property owners now have less than 28 days to file a response with the court before any further action can be taken.
On Tuesday, they discussed filing a unanimous response that would preserve the land restrictions. They also considered selecting an oil and gas lawyer to represent the entire group.