NORWICH – On Wednesday, a crowd of about 100 landowners asked a forum of state legislators multiple questions regarding leasing practices and environmental threats posed by the burgeoning natural gas industry in Chenango County.
Though many weren’t fully answered, the questions weren’t anything new. The officials said they have been bombarded by multiple calls from constituents across the Southern Tier regarding natural gas issues on a weekly, if not daily basis.
Three representatives from New York State Attorney General Andrew Cuomo’s office, sponsors of the event, said they have had to come up to speed quickly on the issues surrounding drilling. Assistant Attorney General Michael Donaher said he didn’t pretend to have all of the details.
“Fifteen to 20 years ago, oil and land leases were all about landowners making a little extra cash. They never signed with the belief that wells would actually be drilled. ... Nobody could have projected what you could see in the future in terms of the royalties and bonuses being offered now. I certainly didn’t have any idea these increases would have occurred.”
In less than 10 years, production of natural gas in New York State has more than tripled. Back in 2003, the state’s annual income from natural gas wells was $232 million with an estimated $29 million filling landowners’ pockets. In 2006, $414 million came into the state and $52 million went to property owners, mostly in Southern Tier.
The action began with successful finds in the Trenton Black River formation in Chemung and Stueben counties. Today, natural gas companies in the area such as Nornew, Inc. and Chesapeake of Appalachia, are targeting not only the widely-acclaimed Marcellus Shale formation, but also the Oneida and Herkimer formations. Bonus prices have increased from single digits to upwards of $2,500 per acre and royalties have continued to inch up past the traditional 12.5 percent mark that New York has traditionally accepted for state lands.