Gas companies face suit for better leases

ST. CLAIRSVILLE – Rebecca Bench believes the natural gas company that convinced her to sign a lease for $100 per acre in 2008 committed a crime by not having a license to conduct business in the state of Ohio.

Bench also believes the company that now holds her lease, Hess Corp., is paying property owners much more than $100 per acre to lease property in Belmont County, so she contends landowners like herself are getting a raw deal. She said Hess representatives plan to soon drill on the acreage she originally leased to Mason Dixon Energy.

Bench, an attorney and property owner, filed her own lawsuit against Hess, Marquette Exploration and Mason Dixon, claiming Mason Dixon had no authority to acquire leases in Ohio – and knew that the land was worth far more than the amounts the company agreed to pay her and roughly 300 other property owners in 2008.

“I would like to see Hess review all the leases they acquired from Mason Dixon and Marquette, make sure they are valid and make sure people in Belmont County are getting fair market value for their land,” she said. “There are a lot of people in my same position who should benefit from this action.”

Records show Bench and her husband, Kevin Bench, signed a $100 per acre lease with Mason Dixon in December 2008 – 1/52 of the $5,200 per acre payment that is the highest known in Belmont County recently. Mason Dixon’s website notes it is a “Delaware Limited Liability Company with principle offices located in Bridgeport, W.Va., and Pittsburgh, Pa.”

Belmont County Recorder’s Office files show that in April 2009, Mason Dixon assigned many of these leases, including Bench’s, to Marquette. On Sept. 8, 2011, Hess issued the following press release:

“Hess Corp. announced today it has acquired Marquette Exploration and other leases in Ohio’s Utica Shale, boosting its acreage position by 85,000 net acres at a cost of approximately $750 million.”

The Recorder’s Office shows that on Sept. 16, Marquette officially changed its name to Hess Ohio Resources, a division of Hess Corp.

Bench said upon investigation, she discovered Mason Dixon never had a license to operate a business in Ohio. She states in her complaint that those who operate this way are committing a “misdemeanor of the fourth degree.” Bench also alleges Mason Dixon “made fraudulent representations to plaintiffs regarding the oil to be drilled in the area and the value of the said oil.”

However, Mason Dixon attorney Karen Kahle sees the matter somewhat differently. She has filed to have the company dismissed from the lawsuit altogether, stating Mason Dixon “no longer claims any interest in the real property at issue.”

“When a complaint is filed, it is based on allegations. Our motion to dismiss is based on these allegations,” said Kahle. “We have not admitted to or denied anything in the complaint to this point.”

Bench disagrees though, as she states that if the court finds the Bench lease to be void, “a property interest would then revert to Mason Dixon who is the initial lessee of the lease.”

Hess attorney Gina Russo states in her response to Bench’s complaint that her client is “without knowledge or sufficient information” to comment on whether Mason Dixon was ever licensed to do business in Ohio, or if company representatives made false representations regarding the value of the land. Russo also notes that Bench’s assertion that doing business in Ohio without a license is a criminal offense “does not state factual allegations.”

Russo is also filing a counterclaim against Bench to allow the company to proceed with drilling operations. This is in response to Bench seeking an injunction to keep Hess employees or subcontractors from entering her property.

“Speedy relief is necessary to protect the interests of the parties from interference,” Russo states. “Hess is entitled to declaratory relief in order to realize the full enjoyment of its rights in oil and gas in, on, and under the property.”

Russo also does not seem eager to have the case transferred to federal court – as is the case with many lawsuits involving natural gas companies – as she states, “Belmont County is where the property subject to counterclaim is situated.”

Bench plans to remain the plaintiff’s lead counsel in the case for as long as it lasts, but said she is enlisting the help of Canton, Ohio-based Joshua O’Farrell of the law firm Tzangas Plakas Mannos and Raies for assistance. O’Farrell is now working on a case involving 33 landowners regarding oil and gas rights in Columbiana County.

The case is set for its initial hearing at 11 a.m. Monday before Belmont County Court of Common Pleas Judge Jennifer Sargus.