Moon OKs last of 6 Consol drilling pads
Less than a year since Consol Energy Inc. broke ground on the first natural gas well pad at Pittsburgh International Airport, work on the last of six drilling sites is poised to begin with a go-ahead from officials in Moon.
Consol Energy on Wednesday sought approval from the Moon Board of Supervisors to build a well pad on land it leases from the Allegheny County Airport Authority, which owns 9,000 acres surrounding the airport.
The Cecil-based company agreed to pay the authority $46 million up front, plus an estimated $450 million in royalties over 20 years for the right to extract natural gas from the Marcellus shale formation beneath the airport.
Moon's Planning Commission signed off on the conditional-use application to permit the well pad in mid-July. The airport's property is in Findlay and Moon.
Moon supervisors unanimously approved the conditional permit Wednesday evening.
Consol has five other well pads on airport property that are in various stages of development. It began fracking six wells on Pad 2 on April 1. Fracking on that site is complete, said Brian Aiello, a Consol spokesman, and Pad 2 is expected to start producing natural gas by the end of the year.
Consol last month announced it is cutting 290 jobs in its gas and corporate operations. That's in addition to 165 layoffs in the spring in its gas exploration and production division and corporate support. The company reported a second-quarter net loss of $603 million in the wake of low natural gas and coal prices.
Aiello said that does not affect Consol's plans for the wells at the airport.
Given the market conditions, drilling companies might focus their production efforts in contiguous areas were several wells are in close proximity for efficiency, said Tom Murphy, director of Penn State's Marcellus Center of Outreach and Research.
Bob Kerlik, spokesman for the Allegheny County Airport Authority, said about half of the lease payment will be used to defray airport landing fees and other rates charged to airline carriers.
The other half will be invested into airport facilities to address capital needs and to carry out economic development projects, Kerlik said.
Melissa Daniels is a staff writer for Trib Total Media. She can be reached at 412-380-8511.