NORWICH – Though not all of the particulars have been determined, the news last week that 19,000 acres in Broome County was leased for natural gas development breathes new life into what has been a quiet period for Chenango County landowners.
A coalition of 700 property owners in Binghamton and Conklin signed a preliminary deal June 19 with Hess Corporation and Seneca Resources Corporation for $3,500 per acre and 20 percent royalties.
The amount compares to a deal signed 14 months ago where XTO Energy agreed to pay to lease 37,000 acres in Deposit at $2,400 per acre for mineral rights and 15 percent royalties.
The development is a good sign that the industry “appears to be heating back up,” said Brian Conover, a member of the Central New York Landowners Coalition based in New Berlin.
Bryant LaTourette of the Oxford Land Group said the development is “a good start for our area.”
New York Governor David Paterson placed a moratorium on all permitting and drilling into shale formations last fall in order to give the New York State Department of Environmental Conservation time to catch up with new horizontal drilling and hydrofraking technologies. That action has put New York behind Pennsylvania and other Appalachian Basin states where record-breaking reserves of natural gas are being produced from the Marcellus Shale formation.
The Broome County coalition agreed to accept the companies’ offer, but the contracts have yet to be completed. The corporate partners would pay in a tiered system, with a total of $1,500 per acre for an exploratory phase through 2012, and a total of $1,500 an acre from 2013 to 2015.
At the end of 2012, the companies have the option of deciding whether to continue into full scale development through 2017.
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