| By Bob Weaver
West Virginia (and Calhoun County) sits on one of the USAs largest natural gas reserves.
While natural gas has historically kept a low-profile in the public, it is now being PR'ed with a multi-million dollar campaign, mostly financed by the big producers.
It might not be wise to believe their spin, less perception becomes reality in PR campaigns.
Here's a big example.
A recent Letter to the Editor of the Calhoun Chronicle said nearly 3,000 gas wells have been drilled in Calhoun, stating:
"Last year, Calhoun received more than $2,466,304 in severance tax and property tax revenue because of the production of natural gas, with the lion's share going to local schools."
A check on the actual severance tax money received by the county last year, was about $111,000.
The local school system received more, but the amount could not be obtained this week.
Six producers signed the letter, Equitable Resources, Dominion Exploration and Production, East Resources, S & R Gas Ventures, Key Oil and Linn Energy.
It could be the production of natural gas in the county did actually generate that amount of taxes last year for West Virginia, but the county did not get it.
So, their PR statement to Calhoun citizens was short on facts, a half-truth, or a half-lie, if you prefer.
The winning of the publics mind, the PR assault, is much like coal's PR efforts about creating "a field of dreams" that creates jobs with mountaintop removal, plastering "I Love Coal" on cars and people's lapels.
The state's rural counties sitting on those deposits stand to gain little from the extraction beyond some jobs, not unlike southern West Virginia's coal counties which are still among the poorest in America.
Several years ago an effort by the Calhoun Commission to tax the gas outfits went down in flames, money that could have been used for grant applications, community development and infrastructure.
The latest natural gas war to change the rules in favor of the producers has reached the halls of the WV legislature.
If history yields a prediction, the public will lose.
THE GAS WAR
The current battle in the Legislature will likely center on fighting against landowners rights or seeing to it that the big gas producers are able to dip into the sacred 1/8 royalty interests owned by West Virginians.
The gas industry, with the exception of some responsible producers, has had a long history of ignoring landowner concerns, citing the law.
The corporations are apparently unhappy to own 7/8's, they're charging production costs against the 1/8 owner, citing federal "law."
The next few months (or years) it will likely be overturned, again if history holds true.
A Roane County jury awarded a class of more than 10,000 natural gas well royalty owners a total of $404 million in damages.
The plaintiffs contended that Columbia Natural Resources, LLC, formerly owned by NiSource, Inc., and now owned by Chesapeake Energy Company, systematically and deliberately underpaid them in violation of their leases.
The violation was withholding the production costs from the royalties paid to the plaintiffs. The jury's verdict included compensatory damages of $134 million and punitive damages of $270 million.
After losing the court battle, Chesapeake Energy, the nations third largest producer, threatened to leave the state and not build their new headquarters in Charleston.
They didn't.
The pot of gold is under their feet, instead they're building a new headquarters in Charleston and expanding their operations.
About 3,000 wells will be drilled in the Mountain State this year, compared to only 300 about five years ago.
Where deep well drilling fits in the picture has yet to be determined, but producers are saying drilling those wells will likely start within the next year.
Calhoun County has been over-studied and surveyed for deep well drilling. The future of the "gas gold" under these hills has been minimized.
Gov. Joe Manchin, who supports big gas, told Chesapeake Energy, "If government doesn't open its mind, if it doesn't open its entire repertoire, if you will, of how we do business, nothing will change."
Manchin's comments came after WV legislators failed to jump on his proposals to give the energy corps a one-up on the state's royalty holders.
"I LOVE GAS"
The WV gas industry is launching a three-year multi-million dollar campaign aimed at highlighting the industry's role in the state.
It includes the utilization of lobbyists and multi-media ad campaigns.
The PR effort is called "Energize West Virginia."
The goals of the PR program:
- To inform state residents of the economic importance of natural gas.
- To raise awareness of the benefits and job opportunities offered by the industry.
- To establish an "energy curriculum" that would be taught in public schools across the state.
Millionaire producer Lloyd Jackson, failed candidate for governor, is the director of the campaign, He is the former president of the West Virginia Board of Education and a former state senator.
Jackson said, "The natural gas industry has been a part of West Virginia's history for more than 100 years. We have for the most part conducted our business quietly. We think it's time for us to change that."
The campaign is a joint effort of the Independent Oil and Gas Association of West Virginia and the West Virginia Oil and Natural Gas Association.
So far, the effort has been successful with the PR'ing of the state's county commission association, which went on record last week opposing the passage of the Landowners Bill of Rights.
The gas lobbyists convinced the association of counties that such a measure would impede economic development and hurt taxation.
Representatives of the citizens group that wants landowner rights did not get invited to discuss the issue.
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