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Leechburg Area gives firm permission to seek gas-leasing contract

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Tuesday, June 17, 2014, 12:01 a.m.
 

The Leechburg Area School Board will allow a consulting firm to market drilling rights for oil and natural gas on district-owned property in West Leechburg.

The board voted unanimously on Monday to approve a six-month agreement with Western Pennsylvania Gas Leasing Consultants LLC.

By approving the contract, officials are allowing the Meadville-based consultants to seek bids on their behalf for leasing agreements on an eight-acre tract of land at Main and Giron streets.

Now vacant, the land once served as the site of West Leechburg Elementary School.

Per Solicitor Robert Cinpinski's counsel, the board added three conditions to the contract prior to Monday night's approval.

The first was to make no representation or claim that the district does, indeed, own the mineral rights underneath the property.

“Ownership to mineral rights can be a very complex thing,” Cinpinski said. “Sometimes, you have agreements that date back to the late 19th century. We don't want to make any definite claim until we know.”

Western Pennsylvania Gas Leasing Consultants (WPGLC) will survey the land and conduct research to determine actual ownership of the property's mineral rights.

The second condition was added to ensure that the contract was non-binding. With the new language, Cinpinski said, the school board affirms its right to reject any leasing agreements that WPGLC presents to the district.

The board made clear on Monday that WPGLC would not be compensated for its services unless Leechburg Area accepts a leasing agreement.

If it does, however, the district will provide WPGLC with 10 percent of the lease bonus it's offered by the approved drilling company.

Board member Neill Brady estimated that the district could be awarded a bonus of about $3,200 per acre.

District officials declined to speculate on the royalty rate Leechburg Area might set on any leasing agreements for the West Leechburg property.

It's too early in the process, they said, to estimate how much total revenue the district could collect from the potential drilling.

Leechburg Area will present WPGLC with the amended agreement this week for its approval, Brady said.

An after-hours call to the consulting firm on Monday was unsuccessful.

Braden Ashe is a staff writer for Trib Total Media. He can be reached at 724-226-4673 or bashe@tribweb.com.

 

 
 


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