The Tribune Democrat, Johnstown, PA

Local News

November 16, 2012

Landowners hope to cash in from shale-gas rebound

EBENSBURG — Earlier this month the World Energy Outlook released projections that by 2017 the United States will become the world’s largest oil producer.

That did not go unnoticed by Gary Lichtenfels.

“I heard that, and that’s why I’m here,” Lichtenfels said this week as he sat at a table in the Ebensburg Country Club, eager to hear from representatives of CX-Energy.

He was with his father, John.

The two own Lichtenfels Nursery outside Johnstown. They were at the meeting to learn how they might best capitalize on the Marcellus Shale natural gas located beneath 60 acres owned by the elder Lichtenfels on Coon Ridge Road.

“The problem is that the shale lies deep,” Gary Lichtenfels said. “As for my 20 acres, I don’t own the mineral rights.”

CX-Energy is a Wexford-based energy company that has been working for at least two years getting commitments from landowners in the region and negotiating with oil companies for the rights to extract the unconventional shale gas.

The Lichtenfels and about 100 other landowners attended one of a series of meetings sponsored by CX-Energy.

Many of the attendees own land in the northern section of Cambria County, where more of the Marcellus play has developed.

CX-Energy has put together the Cambria County Landowners Group, with the goal of developing one very large contiguous chunk of land to lease to an oil company for exploration.

Prior to this week’s meeting, the Cambria group had 23,000 acres enrolled, a number bolstered by a similar land group totaling 14,000 acres just across the line in Indiana County, said CX-Energy representative Bill Smith.

“The more acres you have, the bigger the sandbox for the companies to play in in this area,” Smith said.

“They want a lot of acres. That’s why it makes sense to be part of a group.”

The Cambria group is one of nine landowner groups developed by CX-Energy in western Pennsylvania, Ohio, West Virginia and New York, he said.

Another active group is the Loretto Landowners Group, an  owner-based initiative that has about 25,000 acres owned by hundreds of northern Cambria County people.

Interest in drilling and land lease deals has declined in recent months.

That was prompted by a natural gas glut and low prices that resulted from reduced usage during the mild 2011-2012 winter.

But that is changing, Smith said, quoting a price per thousand cubic feet at $3.65, up from the summer rate of less than $2.

Perhaps the biggest draw to CX-Energy and other landowner meetings is the report that caught Lichtenfels’ eye.

The outlook is for the United States to overtake Saudi Arabia and Russia to become the world’s largest global oil producer in five years, according to the International Energy Agency.

“It is one of the clearest signs yet of how the shale revolution is redrawing the global energy landscape,” states a Nov. 12 article in the Financial Times.

Attempting to put the potential benefit of the shale gas play in context, MarcellusGas.Org, a website dedicated to following the industry, this week said a single acre could mean as much as $25,000 for the property owner.

The gas itself holds an average value of $200,000 per acre, based on a predicted lifetime production of 4 billion cubic feet of gas.

The estimate is based on information gathered from 2,500 wells and the minimum royalty percentage of 12.5 percent.

Meanwhile, CX-Energy and others are working overtime to sign up as many acres as possible, which will be offered for sale early next year.

The North American Prospect Expo will be held Feb. 5-8 in Houston.

“It’s where the big deals are made,” said attorney Jake Polochak, a member of the CX-Energy legal team.

To read stories in their entirety, visit one of these links:

Click here to subscribe to The Tribune-Democrat print edition.

Click here to subscribe to The Tribune-Democrat e-edition.

1
Text Only | Photo Reprints
Local News
  • WilliamsA ‘I thought I was going to die’

    Hornerstown resident Robert “Bobby” Williams said he endured two hours of surgery, suffered a heart attack and fears he may never again be able to fully use his right arm.

    April 23, 2014 3 Photos

  • JFD traing Firefighters practice river rescues

    Johnstown Fire Department members lift a “victim” out of the rescue basket during training Wednesday along the Stonycreek River flood-control wall

    April 23, 2014 1 Photo

  • Home is Where The Tribune-Democrat is Delivered!

    Here are the names of the 10 entrants that were chosen today-April 22, 2014.  If you see your name, call the Circulation Department at 814-532-5000 (#1) or 1-866-307-0905 to verify your information.

    April 22, 2014

  • sewer meeting map Sewer work will tie up traffic

    Brace yourselves.
    This summer’s sewer main replacement project will delay traffic with detours, closed streets and lane restrictions through one of Johnstown’s notoriously snarled neighborhoods.

    April 23, 2014 2 Photos

  • USS Somerset USS Somerset arrives at San Diego homeport

    The USS Somerset is home.
    The amphibious transport dock ship named in honor of the passengers and crew of United Airlines Flight 93 arrived at its new homeport of Naval Base San Diego on Monday.

    April 23, 2014 1 Photo

  • Jablonski, Stephen Charges filed in courthouse bomb threat

    A Johnstown man was charged by Ebensburg Borough police Wednesday with threatening to blow up the Cambria County Courthouse, a call he admitted to Ebensburg police he made Tuesday.

    April 23, 2014 2 Photos

  • Vizza, Peter Vizza voted deputy mayor

    The top vote-getter in last year’s Johnstown City Council election is now also the city’s deputy mayor.

    April 23, 2014 1 Photo

  • Conemaugh Township rezoning opens business possibilities

    A portion of South Main Street in Davidsville will be rezoned to give greater allowances to the businesses along the road.

    April 23, 2014

  • Sculptor’s work to be raffled off

    The work of a local sculptor will be raffled off during the Art in Bloom show.

    April 23, 2014

  • Katie and Gary Lamer Birthday remembrance bash provides aid to region

    It’s been four years since Johnstown resident Gary Lamer died of complications from pneumonia, but his memory lives on through an annual party that gives back in a big way.

    April 23, 2014 1 Photo

Poll

Would you like to see the Johnstown Community Corrections Center remain open after its lease runs out on Oct. 11, 2015?

Yes
No
I'm not sure
     View Results
House Ads