When landmen sit down with property owners over an oil and gas lease, there can be a lot of money at stake. Some of these prospectors are more honest than others. WRVO's Emma Jacobs reports on kitchen table negotiations underway for natural gas drilling access in the region.
The front line of the controversial expansion of natural gas drilling isn't a meadow in Pennsylvania or New York. It's the kitchen table.
That's where landowners meet with landmen - the fleet of salesmen that gas companies use to convince landowners to sign drilling leases.
Meeting the landmen
Landmen began approaching Ruth Tonachel during the leasing rush that swept through northern Pennsylvania in 2007.
“When they first showed up in 2007,” she says, “there were people knocking on the door a couple times a week, calling constantly, stuff in the mail, phone messages, from all different companies. I mean it was hard to even sort out.”
Tonachel’s property has been in the family since 1790 so she was cautious about the idea of a drilling lease.
She speaks fondly of some of the many landmen she met with. Others did things she didn’t like, like the one she met with at a restaurant.
“He talked awhile about his background and how long he’d been in business and where he was from," she says. "Just chit chat friendly talk … I said 'well I can’t sign anything in a hurry', but he pulled out a whole set of leases all with our names on them.”
Landmen are often compared to fast-talking used car salesman. Tonachel's visitors repeatedly urged her to sign right then and there, claiming theirs was the best deal she'd ever get. When she didn’t sign, they’d come back with a different, better deal. Signing bonuses went from hundreds to thousands of dollars per acre.
But the landmen were putting more than just money on the table - some of them were serving up half-truths, misrepresentations, or outright lies.
Tonachel says a classic example is how landmen pitched waste water holding ponds.
“They described like basically lakes where you could go swimming,” she says. “You could go fishing. You could have a dock. And then they started building them. And they’re plastic lined ... surrounded by chain linked fence with barbed-wire around the top. I was just appalled.”
Mike Knappworks as a landman in western Pennsylvania, where he grew up, and knows the type that Tonachel is describing.
“There’s no doubt that there’s bad eggs out there," he admits.
Knapp, 28, is aware of the charges against landmen: that they barrel into town and pressure neighbors to turn against neighbors, or threaten landowners. In Ohio, officials recently launched an investigation into an alleged gas company document that spells out how to lie to homeowners.
The whole thing adds up to a lot of nervousness – many people declined to talk for this story.
But Knapp says his approach is to try to be a good egg, to be respectful of the very personal decision that property owners are trying to make about whether or not to lease. He says unethical landmen make it hard for him to gain a landowner's trust, so he wants people to be informed.
“There has to be ignorance ... to prey on,” Knapp surmises. “I think that that ignorance is very quickly disappearing which is going to very much leave [unethical landmen] high and dry.”
Landman report card
A group from the Massachusetts Institute of Technology is taking another tack: they’re giving landmen letter grades. They’ve built a website that they want to be the Yelp of gas drilling.
“We heard that different people within a town would have radically different experiences with different landmen," says Chris Csikszentmihalyi, co-creator of landmanreportcard.com. "The point of landman report card was essentially to allow surface owners to keep a journal of their interactions.”
Reviews have trickled in slowly. However, whether individual landmen passed or failed now comes up at the top of a Google search for their name.
Meanwhile, Ruth Tonachel in Pennsylvania still hasn't signed a lease, but she hasn't ruled it out completely. She might consider letting drillers seek gas under her land, but not bore through the surface.
She says the land rush is mostly over in her state, so it's a little late for efforts like the report card. But she warns New Yorkers who haven’t leased yet that they should get smart - before the landmen come knocking.
The Innovation Trail is a collaboration among five upstate public media outlets reporting about New York's innovation. The initiative, funded by the Corporation for Public Broadcasting (CPB), illustrates the connection between technological breakthroughs and the revitalization of the upstate New York economy. For more, go to Innovation Trail.