Nov 5, 2014 4 min read

The Washington County commissioners are poised to enter into a lease allowing Range Resources to extract natural gas from the Marcellus Shale strata beneath Mingo Creek County Park in Nottingham Township.

Scott Fergus, director of administration, announced at an agenda-setting meeting Wednesday morning, under the terms of the lease, Range will construct no surface installations within the approximately 2,200-acre park.

“There should be no effect within the park,” Fergus said.

Representatives from the Center for Coalfield Justice spoke out against drilling beneath the park when the idea was first proposed nearly a year ago. Patrick Grenter, an attorney and executive director of the environmental nonprofit organization, unsuccessfully sought a series of evening meetings for public comment.

Range proposed paying the county a bonus of $6,500 per acre and a royalty of 18 percent once production begins.

“It’s a biggie,” said Commissioner Harlan Shober, who is a Range Resources leaseholder on 2 ½ acres of land at his Chartiers Township home.

Fergus said Range alone was willing to pay a full bonus price for 460 acres the county owns but is subject to other leases. Some property owners retained mineral rights for land that became part of the park.

The county’s acquisition of property to create the park in the 1960s predates the tenure of anyone who is now working in the commissioners office.

“Nobody else offered it, and it’s very, very unusual in the industry,” Fergus said after the meeting. “Normally, you give a portion to the present lessee and split the royalty.”

Range has five drilling sites on properties around the park’s perimeter. “One has already been permitted, so there should be production in four to six months,” Fergus said.

When the county announced in 2013 it planned to seek proposals from firms hoping to extract shale oil and gas from beneath the park, it negotiated with Range, EQT and Rice Energy. “We went to three firms we knew were interested in it. It was important that we were getting the biggest upfront bonus money from a firm big enough to develop the park with a nonsurface lease,” said Fergus.

An energy company approached the county several years ago about drilling a conventional well in the park, but it never materialized, Fergus recalled.

“That was non-negotiable about Range (not) drilling in the park,” Commission Chairman Larry Maggi said Wednesday after the agenda meeting. “Mingo is used by lot of people daily. We plan to maximize our assets and still keep green space there.”

Mingo is home to an off-leash dog park; walking and equestrian trails; a night-sky observatory that serves as a gathering place for stargazers from the region; a creek for wading and crayfish-catching; playgrounds and picnic pavilions; and a pair of covered bridges that are a backdrop for an annual autumn festival that encompasses Washington and Greene counties.

Mingo’s land lies close to heavily populated areas in the Route 19 corridor from Greater Washington to Peters Township.

Cross Creek County Park, which features a 258-acre lake near Avella and West Middletown in the northwest corner of the county, has had well sites for the past eight years. Cross Creek park’s first well was a vertical well that was plugged this year. About 30-some horizontal drilling legs lie beneath the entire 2,800-acre park.

The county has two goals in seeking sub-surface drilling leases, namely, raising revenues and keeping property taxes low, Fergus said. Half of the royalties from producing wells are earmarked for park improvements, while the rest of the income goes into the county’s general fund.

Washington County’s income from wells in the Marcellus Shale tapped beneath county-owned land reached six figures every month of the past year.

So, for the fifth year in a row, property taxpayers of Washington County should see no increase in their 2015 county tax bills, based on the $82.7 preliminary budget prepared for the county commissioners. The 2014 final budget the commissioners adopted totaled $80.9 million.

The bulk of the $4,923,107 from the first seven months of 2014 comes from wells at Cross Creek County Park, but the total also includes smaller infusions of cash from wells under the county-owned fairgrounds and Panhandle Trail.

The board plans to vote on the lease at its meeting scheduled for 10 a.m. Thursday in the public gathering room in the Courthouse Square office building.