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January 8, 2013

Company looks to lease CSA land for shale gas

JOHNSTOWN — Cambria Somerset Authority land in Jackson Township is being eyed by a company collecting gas rights for a planned Chevron shale well.

And CSA officials indicated they are willing to discuss the possibility.

The company wants to lease nearly 31 acres of CSA land along Blackburn Road near Vinco, Greensburg-based land broker Torrey Sochacki wrote.

The initial offer: $300 per acre, totaling a $9,210 payment for a five-year mineral rights lease, plus 12.5 percent royalties if drilling occurs, said Sochacki, of T.S. Dudley Land Co.

CSA Chairman Jim Greco called that “a very preliminary offer” that would be negotiated if the authority decided to consider a deal.

He noted the board will have to do its homework first.

That would likely start with a sit-down during the coming weeks with the land brokers and, possibly, Chevron, regarding details on what the driller is planning, and where, Greco said.

“All we basically have right now is a three-page letter indicating they are interested,” he added. “This is just the first step in a long process.”

The property sits along the Hinkston Stream, CSA manager Earl Waddell said. On Thursday, the board gave Chevron approval to have an independent firm conduct a “pre-drilling water analysis” on the property.  

Such studies are required by the state for properties close to proposed drilling operations to identify current water resources and their quality and content. The report is designed to establish a picture of water source health before the industry locates nearby.

“The most important thing is ensuring our resources are properly protected,” Greco said. “We’re not going to risk screwing up the one resource we have – the one we sell to people.”

In his letter, Sochacki said the CSA property is within a mile of a wellhead planned for development on another tract of land.

If permitted by the state, Chevron would use the horizontal drilling method to access the Marcellus Shale. The process allows crews to capture gas from areas from adjacent properties through one well pad.  Sochacki did not offer specifics on the drill pad site’s location.

Jackson Township manager Dave Hirko said township officials are aware Chevron is interested in putting wells in the area.

Planners and residents have both stopped by his office for information, he added.

“But we don’t have site plans yet,” Hirko said. “It’s all still very preliminary.”

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