New Castle News

May 15, 2013

Hilcorp might drill in Neshannock Township

Debbie Wachter
New Castle News

NEW CASTLE — Marcellus Shale drilling could be moving into Neshannock Township.

A Hilcorp Energy Co. representative said during the Neshannock supervisors meeting Tuesday that the company has leased Millennium Park property off King’s Chapel Road for possible drilling.

Ken Daugherty, surface land manager for the Houston-based firm, told the supervisors Hilcorp is in the preliminary stages of inspecting properties such as Millennium Park for potential drilling sites.

He asked the supervisors if the township would share survey information obtained by its engineers who designed the sewer system for Millennium Park. Daugherty indicated Hilcorp plans to build an access road near the sewer lines and needs depth information about manholes.

He previously had sent the township a letter asking for information sharing with Hatch Mott MacDonald of Pittsburgh, the sewer engineers.

“We’re willing to pay for it,” Daugherty said Tuesday.

Township solicitor Louis Perrotta advised him to have an engineer for Hilcorp draft a letter in greater detail, indicating the exact location of the property, where roads would be, how much Hilcorp is willing to pay for the information and whom the company is willing to pay.

Ralph Sheen, supervisor chairman, agreed with Perrotta, telling Daugherty, “Treat your first bill as if we are going to have someone review it,” he said, motioning toward Perrotta.

“If you don’t pay your first bill, we’re not going to do it,” Sheen said. “The first thing is to review the letter.”

Daugherty said he is only asking for information that the township sewer engineers already have.

According to Linda Nitch, Lawrence County Economic Development Corp. executive director, the agency entered a land lease with Hilcorp last fall for its mineral rights at Millennium Park.

She refused to say what the economic development corporation was paid.

The corporation owns 430 acres at Millennium Park and Hilcorp has leased “basically everything we own,” Nitch said, including the mineral rights that lie under a spec building on that site.

About 16 acres, where Steelite International is located, is owned by Medure Development, but Nitch said she does not know if Medure has leased that property to Hilcorp.

Nitch said the economic development corporation already has received its bonus payment from Hilcorp for the Millennium Park lease, and it also is to receive royalties for any drilling done there, under the agreement.

The money will be invested in economic development activities in the community, she said, adding, “Whatever dollars are there, it’s our mission to make sure they’re used for job creation and job retention.”

Nitch said Hilcorp has not confirmed whether it will actually drill on Millennium property, but indications are strong.

“They’re doing their due diligence,” she said. “They need to investigate where the sewer line is and understand what all was involved in it.”

“Everything is preliminary,” Daugherty told the supervisors regarding Hilcorp’s plans. “We’re first looking at potential well sites. We might look at a dozen different sites and only pick one of them.”