Encino Acquisition Partners, LLC has invested $300 million into extracting oil and natural gas from Ohio state parks and other public lands.
EAP received mineral rights for four sites in Ohio State Parks, according to an Ohio Department of Natural Resources news release. This includes three sites in Valley Run Wildlife Area in Carroll County and one site in Zepernick Wildlife Area in Columbiana County.
Encino Energy, based out of Houston, Texas, along with the Canada Pension Plan Investment Board, created EAP as a subsidiary in 2017, according to a CPP news release. The CPP holds 98% equity of the company.
The CPP is a public pension distributed by the government to over 22 million Canadians, according to its website. The plan has an independent board tasked with managing funds for policyholders.
“If someone (is) working in Toronto and they're paying into this pension plan – well, they're financing fracking in Ohio,” Save Ohio Parks Steering Committee Chair Cathy Cowan Becker said.
Along with the rights to Ohio state parks, EAP also bought 900,000 acres of oil and gas assets from Chesapeake Energy, which used to be one of the largest natural gas producers in Ohio, in the Ohio Utica Shale region for $2 million in 2018, according to a CPP news release.
According to a report from the U.S. Energy Information Administration, the Utica Shale is an expansive oil and natural gas field that covers 115,000 square miles and spans four states from northern New York to northeastern Kentucky and southern Tennessee.
Becker said EAP is buying a company that owns fossil fuel infrastructure.
“They think they're going to make money off of that, so I guess you could call that a return on investment too, but it's just not,” Becker said.
Daniel Karney, an economics professor at Ohio University, said EAP is trying to get a return on its investments to grow its capital.
”They think a good way to do that is to invest in generating, purchasing and then producing oil and natural gas,” Karney said.
The U.S. remains the world's top destination for foreign direct investment for the 12th consecutive year, according to the U.S Department of Commerce. This is partially due to strong consumer and government expenditure and robust export levels.
Karney said individual states can use parks as assets and sell them to make profits.
Ohio usually charges low profit percentages when leasing public land, but the state is trying to raise those rates, Becker said.
“It's going to be, at this point, something like 18% to the state of Ohio, but that only lasts for as long as the fracking lasts, and you can only frack one place so many times before there's no more gas left,” Becker said.
According to an ODNR news release, however, Ohio is only set to receive 12.5% of royalties from EAP.
The operation comes after an Ohio judge dismissed a lawsuit from Save Ohio Parks allowing companies to lease public land, according to a previous Post report. The decision opens over 1,000 parcels of land to oil and natural gas companies.
Melinda Zemper, Save Ohio Parks steering committee chair, said communities near fracking operations experience negative economic effects.
“The eight main counties in Ohio that have been fracked for decades came to the conclusion that they lost population by about 8% and the number of jobs that they had for the community was also down,” Zemper said.
She also said farmers can lease mineral rights to their land and make a lot of money.
“It's the most money they've ever seen in their lives and are able to take vacations or buy cars or pass their farms on to the next generation,” Zemper said.
Becker added fracking poisons the land, so farmers can’t grow or have animals on it.
