T-L Photo/ROBERT A. DEFRANK Rice Drilling D LLC and Gulfport are ordered to pay about $40 million to a local landowner for drilling beyond the lease limits on property along Belmont-Warnock Road.

ST. CLAIRSVILLE — Rice Drilling D LLC and Gulfport Energy will pay a local landowner about $40 million after a jury found the companies went beyond the bounds of their land lease.

The civil trial began Tuesday before Belmont County Common Pleas Judge John Vavra. The jury deliberated for about three and a half hours Thursday before finding in favor of compensation for trespassing and damages to the plaintiff, Tera LLC, owned by Thomas Shaw.

“I think in the history of Belmont County this is probably the largest jury verdict ever,” Vavra said.

Tera entered into an oil and gas lease with Rice Drilling seven years ago. Rice later sold a percentage of the lease to Gulfport.

There are six wells on the 270-acre property on Belmont-Warnock Road in the Warnock area.

In 2015, the drilling apparently began to exceed the bounds outlined in the lease.

“The lease was very specific, limiting the defendant’s access to two layers of the sub-strata,” Vavra said. “They drilled their wells and started producing gas.”

However, Shaw later looked into the operations through the Ohio Department of Natural Resources records and found the companies were drilling beyond those two deposit levels, designated the Marcelus and Utica, and were taking gas from the Point Pleasant level.

The companies were drilling between 1 1/2 and 2 miles down.

“They shouldn’t have gone past what the lease said,” Vavra said.

There were no allegations of environmental infractions or other damage to the property. The damage occurred through taking gas from an area where Tera retained mineral rights. Vavra said the defense argued Shaw had not sustained damage.

The companies will be required to pay $23,171,454.37 for gas taken from the deposit and $18,958,462.25 for gas they will continue to take, totaling $42,129,916.62, with $2,000,559 deducted for royalties, bringing the sum to $40,129,916.62.

Five witnesses gave testimony, including a petroleum engineer, a retired college professor with a background in petroleum engineering and a geologist. Shaw and a representative from Rice also testified.

St. Clairsville attorney Charles Bean, who represented Tera, said while he has handled other land lease claim issues, this is the largest verdict.

“There’s a message to the oil and gas companies to treat landowners correctly,” he said.

Bean said other land leases generally are more vague and open-ended or simply grant rights to all minerals under an area.

“The lease was clear. They leased two strata, the Marcellus and Utica,” he said. “They drilled into and targeted the Point Pleasant formation and took that oil and gas they didn’t own. That’s as a matter of law, and we were entitled to damages for the value of that oil and gas.”

He emphasized the importance of attention to detail.

“This was a unique lease. It was well-written and that’s why. It was ironclad in that they had two strata,” he said.

Bean said the companies are jointly and separately liable.

“I’m sure they’ll appeal, but if the judgement stands we could collect from either or both,” he said.

“I think the jury worked hard, the court worked hard, and Mr. Shaw and our legal team, we worked hard. We’ve been at this for four years,” he said. “You’ve got to check the ODNR website to find out what’s going on.”

Rice and Gulfport and their attorneys at Steptoe and Johnson could not be reached for comment following the verdict.