XL Sand and Gravel tells trustees losing water sales
NEGLEY – XL Sand and Gravel owners believe companies are skipping over Middleton Township and going elsewhere for water to use in the oil and gas drilling process.
Mike and Kristen Lansberry told township trustees this week XL is losing business because it can’t sell water from its location on Jackman Road.
In order to sell water the company must first have a road use maintenance agreement (RUMA) for Carmel Achor and Jackman roads, and the Lansberrys say it’s not fair they have to pay extra for roads they are already paying taxes on.
The township previously had a RUMA for Carmel Achor with Chesapeake Energy but it was canceled in September of last year, a year and a half after it was first approved in 2011.
It was the first RUMA for Columbiana County at that time and allowed the oil and gas exploration company to use Carmel Achor to transport water from local drilling sites into Pennsylvania.
The agreement cancellation was initiated by the company, which claimed the road located between state Routes 170 and 154 was no longer needed for its purposes. Chesapeake began getting water elsewhere.
A settlement was reached between Chesapeake and the township in September with the company agreeing to pay 82 percent ($59,181) of the cost of improvements to the 1.3 miles of road, with the township responsible for the remainder.
The agreements require companies involved in the preparing and operation of drill sites to upgrade and maintain the roads being used to get to the site and to resurface them when drilling is completed.
While not a drilling company, XL wants to sell water to those companies for use in the hydraulic fracturing process. Once sold, the companies are responsible for hauling the water away from the business using the township roads.
The business already sells water from its state Route 170 location, and is allowed to do so since RUMAs are not required for state roads.
Trustees said the water trucks – while the legal weight limit – wear down the roads since they travel the roads frequently.
Kristen Lansberry argued the traffic is only for a short period of time.
“There are only so many fracs that go on at one time … everybody wants to believe that it is this big hyped up 24-7, 365 days a year but it’s not, it’s not even close,” she said.
She mentioned that water trucks only spent about five straight days traveling through the township last year.
“We have lost astronomical amounts of business over this, over not being able to use that road,” she said of Carmel Achor.
Trustee Nancy Michaels said if the business sells water there it will cause “tremendous truck traffic” on Jackman Road.
“What do all of our taxes that we pay to use these roads go for?” Kristen Lansberry asked.
Trustee Greg Lipp said they had a good argument, and suggested getting the road bonded as opposed to requiring a RUMA.
“I think your father and your uncle had a verbal agreement with trustees years ago. I think the verbal agreement days for society are over,” he told Mike Lansberry. “I’d like to say Middleton Township is open for business but on the other hand we just need some assurance that if there is damage to the road we would have some needs of repairing them.”
If a RUMA or bond is put into effect the township would remain responsible for maintenance and snow removal, with the business responsible for any repairs to damage caused by truck traffic.
With regards to taxes, Mike Lansberry said trustees should contact someone in Columbus to see where tax revenue is going.
“There are federal taxes, excise taxes … I have a list of taxes that just our company pays. I can’t imagine what a company like Chesapeake pays,” he said. “Is the money not being allocated to come back to these small townships? Because we are paying our taxes.”
Fiscal Officer Bob Chapman agreed there is no money being sent back to Ohio counties involved in oil and gas drilling for their infrastructure, and there should be.
Michaels and Lipp said they would contact their legal counsel, attorney Andy Beech, to see what could be done about an agreement or bond for the business to use the roads for selling water.
Trustee Timothy Pancake was absent.