American Oil and Gas Reporter - February 2021 - 36

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IssuesUpdate: Ohio Oil & Gas Association

OOGA Monitoring Revisions Process
COLUMBUS, OH.-As he contemplates priorities for his term as chairman
of the Ohio Oil & Gas Association, Bruce
Levengood, president of Sound Energy
Company Inc. in Dover, Oh., mentions
improvements to the state's approach to
permitting and information requests, as
well as resuming in-person meetings with
state regulators as soon as it is feasible.
" I would like to advance those conversations and help resolve some issues
that have lingered over time, " he remarks.
While these issues can be resolved by
convincing agencies to change how they
manage internal processes, Levengood
notes that fixing others will require passing
bills or initiating formal rulemakings.
" I also want good policy, " he emphasizes. " We are working on tax clarifications
and possible ways to streamline our state's
section on underground injection control
while looking at advancing the state's
pollution control certifications for those
facilities. That will give the Ohio Department of Taxation the tools it needs to
conclude its audits. "
OOGA President Matthew Hammond
highlights several other top objectives:
· Engaging with the Ohio Department
of Natural Resources as the agency revises
its oil and gas regulations;
· Eliminating roadblocks that prevent
mineral leasing on state lands;
· Improving Ohio's unitization
process; and
· Intensifying the state's effort to
plug orphan wells.
Achieving these goals will require
legislative action, Hammond notes, but
the straightforward issue of dollars and
cents also looms large in the early days
of the 2021 Ohio General Assembly.
" The legislative outlook all starts with
the budget bill, " he stresses. " Much like
every other state, Ohio can trace its budget
hole back to the economic halt associated
with COVID. How are legislators going
to patch that? What money comes from
the Rainy Day Fund? Where do they
need to find new revenue? Where will
they have to cut? That bill is going to be
a really big challenge. "
Meanwhile, the coronavirus pandemic
continues to complicate OOGA's legislative strategy, Hammond acknowledges.
Although the general assembly's calendar
appears likely to adhere closely to its
customary schedule, life at the Capitol
36 THE AMERICAN OIL & GAS REPORTER

remains unusual. As an example, he observes, legislative staff members are supposed to perform most of their work from
home and only come to the statehouse
once a week on a rotational basis.
" With all the things OOGA wants to
accomplish, what does education and engagement look like in that situation? "
Hammond poses. " At the end of 2020,
assembly members were not taking meetings in their offices. If you wanted to talk
with someone, you had to get that person
on the phone. How do you engage if they
ignore requests for meetings? We still
are figuring that out. "
Important Engagement
Hammond says ODNR's regulatory
revisions are not limited to rewriting existing rules, but include new requirements.
OOGA is approaching the exercise with
an open mind and a keen eye, he assures.
" It is a great opportunity for us to engage
with the Division of Oil and Gas, particularly
to make sure we always support strong and
reasonable regulations, but avoid rules that
do not make sense, " Hammond reflects. " It
is important Ohio's rules continue to allow
our members to operate in a safe, responsible
and cost-effective manner. "
Regarding state minerals leasing, Hammond acknowledges OOGA has wrestled
with the issue for many years. A lack of
progress in that area characterized Governor
John Kasich's administration and has continued into the second year of Governor
Mike DeWine's term, he recounts.
" Nothing has happened, " Hammond
describes. " We cannot enter into a lease
with the Ohio Department of Transportation. ODNR's Oil and Gas Leasing Commission does not have rules, so it cannot
operate. We are at a tipping point and
something must give. We need support
from the DeWine administration on this. "
According to Hammond, the situation
violates the rights of private landowners
whose minerals share a unit with unleasable state minerals. Exacerbating that
situation is Ohio's dysfunctional unitization
process, which he says takes longer in
Ohio than in any other state. Streamlining
it, he continues, will involve working
with both ODNR and lawmakers.
" The core goals must be achieved in
statute, " he assesses. " However, there are
improvements the administration can make
to help move things along. For instance,

the division holds hearings once a week
(though not always when there are holidays), and typically only has two hearings
that day. We are maxed out at 100 unitization applications and probably will see
significantly more moving forward. "
As for orphan wells, Hammond points
out that recent pushes within Congress
and even in Canada's national government
suggest the issue appears particularly ripe
as a way to promote oil field jobs while
improving the environment.
During the 2018 Ohio General Assembly, he notes, OOGA successfully
persuaded lawmakers to boost funding
for Ohio's Orphan Well Program from
14% to 30% of the state's oil and gas
severance tax revenue. The automatic,
and now increased, allocation is a boon
for Ohio's plugging efforts, Hammond
praises, especially since most other producing states allot plugging monies from
their general funds-all of which enter
2021 lighter than expected.
" Ohio has a pot of money that can
allow it to get ahead of a lot of states that
are diverting severance tax funds away
from regulatory agencies, " he contrasts.
" To the DeWine administration's credit,
its people understand this is an important
issue and they are doing more on it than
any previous administration, with a goal
of plugging 200 wells a year, but that may
grow. I think we should ramp up spending
to $28 million-$32 million a year. "
❒

Apache Again On List Of
Fortune's Most Admired
HOUSTON-Apache Corp. has been
named by Fortune magazine as one of
the World's Most Admired Companies.
" We are honored to be recognized by
Fortune for the fourth consecutive year
as one of the World's Most Admired
Companies, " affirms President and Chief
Executive Officer John J. Christmann.
According to Apache, to determine
the best-regarded companies in 52 industries, Korn Ferry asked executives,
directors and analysts to rate enterprises
in their own industry on nine criteria,
from investment value and quality of
management and products to social responsibility and ability to attract talent.
A company's score must rank in the top
half of its industry survey to be listed. To
see the rankings, visit fortune.com. ❒

http://www.fortune.com

American Oil and Gas Reporter - February 2021

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