Harrison County Commissioner Don Bethel speaks about the county receiving oil and gas royalties due to an error made on the part of Chesapeake Energy Corporation. The former company, now owned by Encino Energy, paid approximately $6,900 in royalties to the county instead of the private roadway’s owners.

CADIZ – A group of Monroe Township landowners, known as the Our Land Company Three, are attempting to reclaim oil and gas royalties from a private roadway that was mistakenly distributed to Harrison County.

Attorney Brad Hillyer met with the Harrison County Board of Commissioners Wednesday morning to discuss the “dispute” his clients Our Land Company Three claim to have with the county. The Our Land Company includes eight homeowners who own a private roadway in Monroe Township near Bowerston.

“We have a dispute with the county that has now been going on for a year concerning the road going into Our Land Company Three,” Hillyer said.

In 1992, the Monroe Township road was supposed to be dedicated as a township road, however the dedication was never completed due to Our Land Company failing to get the road up to county required standards.

Years later when an oil well was placed near the roadway, Chesapeake Energy Corporation mistakenly distributed the road’s royalties to the county opposed to the group of land owners because of the impending dedication plat. The oil and gas company has since been bought and is now owned by Encino Energy.

The total paid out to the county thus far is approximately $6,900.

“Harrison County has been, until about January of last year, receiving royalties for the well’s on the Our Land Company property and the adjoining Bowerston Shale property that do not belong to you. I have tried everything to get this resolved,” Hillyer said.

Neither the county nor the township maintain the roadway since the dedication was never completed. It has since been maintained by the collective landowners.

“I don’t think there’s any evidence, at all, that the royalties under those wells belong to Harrison County,” Hillyer said.

Since the dispute was made by the landowners, Encino began holding the current stream of royalties in an escrow account until a conclusion can be legally made to who owns the roadway.

“Encino is prepared to pay them over as soon as there’s an acknowledgement that Harrison (County) does not own them,” he said.

“I just need to know if Harrison is going to refund it ($6,900 royalties) or not.”

Commissioner Paul Coffland said he doesn’t feel as if there has ever been a dispute since the county acknowledged the mistake.

“I don’t think we’ve ever disputed that it’s your royalties. I think what we’ve been trying to claw our way back through with the prosecutor (Owen Beetham) is those leases were one of the originally signed leases predating his tenure as prosecutor,” he said.

Coffland said the county has been trying to figure out if the oil and gas company owes the residents the back royalties or if the county can indead write the landowners a check for the funds.

County Prosecutor Owen Beethem said the dispute the landowners have lies with Encino and not with the county. Hillyer disagreed and said the dispute is not with Encino but with the county.

“Encino recognizes there’s a problem that’s why they escrowed the money. You have my clients’ money and I have proved there is no dedication and you (commissioners) have acknowledged that, so you need to refund the money you go in error and you need to sign an affidavit so I can get the rest of the money, indicating that you acknowledge there is no dedication,” he said.

Hillyer said Encino will not release the royalties to his clients without the affidavit acknowledging the lack of dedication.

Coffland and Commissioner Don Bethel said the county has not received anything from Encino regarding the matter. Bethel said he is comfortable returning the funds to Encino, however is not comfortable giving the funds to a third party recipient without first speaking with Encino.

“If we owe the money back to Encino then I’m fully prepared to return a check to Encino. Like I said, I’m not really comfortable taking a check from A and giving it to C without discussing this with Encino, which I will admit probably should have already been done,” Bethel said.

“Where is that correspondence, that telephone call, email, text, something just from Encino acknowledging this. That’s the acknowledgment I want first, that Encino says ‘I paid you in error’ instead of a law firm telling us.”

Coffland said commissioners do not want to hold up the matter any further. Commissioners will meet with Beetham and contact Encino in an attempt to have the matter resolved, he said.