Head of Ohio Oil and Gas Commission seeks inquiry into member

The business dealings of a member of an Ohio commission that decides oil- and gas-drilling complaints has spurred complaints from environmental advocates as well as a state ethics inquiry.

Robert Chase represents the public on the five-member Ohio Oil and Gas Commission, which hears cases regarding decisions made by Department of Natural Resources employees. Among other things, the commission hears the appeals of Ohio residents who don’t want drilling on their properties.

Chase runs Marietta College’s Department of Petroleum Engineering and Geology, which trains students to work in the drilling industry. He also works as a consultant for landowner groups that negotiate terms and payments for the mineral-rights leases offered by drilling companies eager to tap oil and gas trapped in Ohio’s Utica shale.

When the deals are struck, he gets a percentage of what the companies pay the landowners.

Jack Shaner of the Ohio Environmental Council said Chase is more a representative of industry than the public. The committee’s other members include two oil-industry reps, a geologist and an oil and gas attorney.

“This thing sounds way too cozy,” Shaner said.

Chase said that’s not true.

“I’m a citizen of this state. I just happen to have a Ph.D. in petroleum engineering,” Chase said. “I’m as objective as anybody in looking at that information.”

Still, Chase said his past work to negotiate lease terms with Oklahoma-based Chesapeake Energy on behalf of a Carroll County landowner group made him recuse himself from a Jan. 25 case involving the company.

The Summitcrest cattle farm near Summitville in Columbiana County contested a permit that state regulators gave Chesapeake Energy to drill on the farm’s property. Chesapeake dropped its drilling plans before the hearing was held.

Linda Osterman, the Oil and Gas Commission director, said she has asked the Ohio Ethics Commission to determine whether Chase’s business activities present a conflict of interest.

Chase has taken part in 13 hearings since he was appointed by Gov. Ted Strickland in June 2008, Osterman said. His term expires Oct. 14.

Elisa Young, a southeastern Ohio environmental advocate, said Chase should not be on the commission.

“He’s profiting from this industry when they sign these leases,” Young said. “I don’t have any confidence at all in this person.”

Chase is also a technical consultant for the Southeastern Ohio Landowners Association.

On Nov. 11, the association announced an agreement with Houston-based Carrizo Oil & Gas Inc. to lease the mineral rights from an undisclosed number of landowners in Noble and Guernsey counties. The terms included a bonus payment to landowners of $5,000 per acre.

According to a sample contract on the group’s website, Chase receives 0.5 percent of the gross bonus payments as compensation. According to that sample, Chase was paid $2,500 for every 100 acres leased under the Nov. 11 deal.

This isn’t the first time that advocates have questioned industry ties among Ohio commissions.

In 2003, Gov. Bob Taft appointed Deborah Carey as the public representative to the Ohio Reclamation Commission, a group that hears complaints regarding coal mines. Carey is the mother of Mike Carey, president of the Ohio Coal Association.

A 2006 Dispatch special report on coal-mining issues found that Wanda Stratton, a farmer representative on that commission, had signed a mineral-rights lease with Oxford Mining Co. and then helped decide a case involving that company.

Another member, forestry representative Earl Murphy, received a pension from Peabody Coal Co.

Chase said he’s careful to avoid conflicts.

“If any of those companies that I accepted any kind of payment from at all were to come before the commission, I would ask to be recused,” Chase said.

http://www.dispatch.com/content/stories/local/2012/02/18/panelist-industry-too-cozy.html