Rice Energy pumps millions into leases
ST. CLAIRSVILLE – Rice Energy has injected more than $100 million into the Belmont County economy since November by signing more than 1,000 leases with mineral owners.
“Over the last few days, we have paid out over $100 million in lease bonuses. This is just the first round of payments,” said Toby Rice, chief executive officer of Canonsburg, Pa.-based Rice Energy. “We are doing our due diligence. The others who are expecting checks should start to see their money soon.”
These upfront lease bonuses are only part of the story, as royalty payments could begin for the landowners once Rice starts pumping natural gas. Though Toby Rice did not specify the terms of these contracts, some known lease agreements from Eastern Ohio will pay mineral owners as much as $5,900 per acre in lease bonuses and as much as 20 percent of production royalties.
Rice said his company hopes to begin drilling in the county by fall.
As large corporations such as Chesapeake Energy, Exxon Mobil, Hess Corp., Gulfport Energy, Antero Resources and others continue expanding into Eastern Ohio in search of the Buckeye State’s wet natural gas that includes propane, ethane and other liquids, Rice is rapidly staking its claim in Belmont County. Toby Rice said the company now has more than 40,000 acres leased in the county through 1,000 agreements.
Records show the company has leases in 12 of the county’s 16 townships, including Richland, Smith, Goshen, Kirkwood, Washington, Warren, Somerset, Wayne, Mead, Wheeling, Pultney and York. Some of the agreements are for as little as 0.5 acres, while others are for much more, including one that is for 364 acres.
The Belmont County Recorder’s Office bustles with activity daily as abstractors look to sign mineral owners to lease agreements, largely due to positive drilling results. Pipeline construction is also ongoing throughout the county to build the network needed to take the gas to market.
According to the company’s website, Rice began drilling in Pennsylvania in 2007.
“Our acreage is located in areas where we believe we can unlock the most oil and gas. The end result is a safer development with better wells and happier landowners. It’s a very simple approach that can only be accomplished with a focus on quality over quantity,” the website reads.