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Theta plays high stakes drilling

By Patrick SweetStaff Writer

A Washington Countyenergy company has plansto drill a natural gas welli n P la i n s To w n s h i p o nproperty owned by ThetaLand Corp., a firm linkedto landfill/casinodeveloper

Louis DeNaples.It is the third proposedexploratorywell inLuzerne County.

Rice Drilling BLLC, a subsidiaryof Rice EnergyLLC, applied for a

permit withthe state Depart-ment of Environmental Pro-tection onJune 24to drillandoperate a well on Thetasproperty just east of Inter-

state 81 and southof JumperR o a d, a cco rdi n g to th edepartments website. Thedepartment may take up to 45days to grant or deny theapplication.

Theta, a former subsid-iary of the now-defunctP e n n s y l v a n i a G a s a n dWater Co., holds tens ofthousands of acres of unde-veloped land in Luzerneand Lackawanna counties.The Plains Township prop-erty would be the first drill-

i n g s i t e o nThetas hold-ings.

Toby Rice,chief operat-ing officer ofRice Energy,said his com-pany has notl e a se d t h e

mineral rights from Theta,but has been contracted bythe company to drill an

exploratory well. He declinedcomment on the details ofthe deal, citing a nondisclo-sure agreement.

Pennsylvania Gas andWatersold Theta andits landto unnamed buyers in 2000shortly after the companymerged with another utility.Information in governmentdocuments indicated DeNa-ples, the owner of the Key-stone Landfill in Dunmore

anddeveloperof Mount AiryCasino Resort in Monroe

County, was involved in thesale,buthehas neveracknowl-edged ownership. In 2008, aDauphin County grand jurythat indicted DeNaples oncharges that he lied to stategaming regulators about tiesto organized crime figuresreportedthat a DeNaplescom-pany owned Theta. The perju-ry charge was later droppedafter DeNaples transferredownership of the casino to a

trust controlled by membersof his family.

Rices permit to drill onTheta land would be its firstin Luzerne County. EncanaOil & Gas USA Inc. is set todrill thefirst two wellsin thecounty in Fairmount andLaketownships this summer.Encanaalsohas DEPpermitsto drill atanother site inLakeTownship and one in Lehm-an Township.

Accordingto Rice, hiscom-pany is poised to begin con-

struction of the well not longafter the permit is granted.

What the well will mean tothe area though, may not bedetermined until muchlater,when or if the well beginsproducing gas.

This well, its going to betough, Rice said. Peoplestart (drilling) in areas wherethey knowit works and slow-ly start to explore.

It could take anywherefrom six to 12monthsbeforethey have an idea of the

wells potential, Rice said.If we are successful, we

would plan on drilling morewells, Rice said.

Attempts to reach DeNa-plesand Theta presidentRob-ert McNichols were unsuc-cessful. A call to Thetasoffice at One Public Squarei n W i l ke s - B a r re w a sanswered withan automatedmessage saying the numberwouldnot accept voicemails.

Along with the Encanawells, Thetas will help paintthe Marcellus gas-drillinglandscape in LuzerneCounty.

Th e f o rme r h o tbe d f o ranthracite coal mining couldsee thenextrushof gas com-panies, including furtherdevelopment of the Thetaproperty.

The Theta well will be thefirst that Rice has drilled inLuzerne, but the companyhas drilled several otherwells farthernorth, Ricesaid.Rice Energyhas leases to themineral rights of roughly

25,000 acres in Pennsylvania.The company does not haveanyleases in LuzerneCoun-ty, though, according torecordsfrom the Recorder ofDeeds office.

Weve already drilled in(Northeastern Pennsylva-nia),Rice said. Werefamil-iar with the regulations uphere. Were experiencedup here.We know what weredoing.

psweet@citizensvoice.com, 570-821-2117

Marcellus Shale Northeastern Pennsylvanias New Frontier

Find information on more than 6,000natural gas leases in Luzerne,Lackawanna and Wyoming counties andmore than 3,600 drilling sites around thestate in our natural gas databases.

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Public vents opposition to utility status for gas pipeline companiesBy David Falchek

Staff Writer

A bid by natural gas gath-ering company Laser North-

east Gathering Co. LLC tobecome a regulated utilityand earn the power of emi-

nent domain faced vocaloppositionat a public hearing

in GreatBend on Wednesday.More than two dozen peo-

ple, including a county com-missioner, spoke before

Administrative Law JudgeSusan D. Colwell and an

audience of nearly 200at thestate Public Utility Commis-

sion hearing at the Great

Bend Fire Department in

Susquehanna County.

Allbut a few were opposedto the petition, which wouldset a statewide precedentgranting natural gas pipelinecompanies public utility sta-

tusand givethem thecontro-versial power of eminentdomain forthe project.

Some speakers cited envi-ronmental concernswith thenatural gas extraction pro-

cess. Other property ownerssaid use of eminent domainto put a pipeline on theirproperty would violate theirrights. Many focused on emi-

nent domain, the process oftaking propertythrough con-

demnation.

Idontwanta privatecom-

panyto tellme whenandhowI can use my land, saidMichael J. Giangrieco, aSusquehanna County com-missioner. They say its a

last resort,but it will becomeone of the first resorts. Ourexperience shows that thisindustry views landownersas an inconvenience.

Patrick Walker of Facto-

ryville called eminentdomaincorporate welfare.

Environmental consultantNancy Wottrich of New Mil-ford lives in a solar-powered

home, grows her own foodand works to maintain her

land. She refuses to partici-

pate in the natural gasrush.

She said eminent domainwould force her to turn overher land for something shebelievesis wrong.

While principals of Laser

Northeast, Scranton nativeTom Karam and TexanChipBerthelot, were in the hall,they did not testify. Theydefended their plans withsomeattendees during breaks

i n t h e h e a r i n g , w h i c hstretchedon forthreehours.

K a r am s a i d e m i ne n tdomain is not an unfetteredpower that negates property

owners rights and interests,but rather a dueprocess that

includes a hearing before a

local quasi-judicial board of

view, just compensation, andan appeals process.

Beyond that, condemna-tion is something LaserNortheast wants to avoid

because of the expense andbad feelings it engenders,Karamsaid.

The only positive com-mentscame fromlandownerswho negotiated agreements

with LaserNortheast, includ-ing LibertyTownshipfarmerJim Barbour. He focused onthe employment and invest-mentthe naturalgas industry

hasbroughtto thecounty andthe need to move gas so that

mineral rights owners may

reaproyalties.

Barbour reminded peoplethat the U.S. has hundreds ofthousandsof milesof naturalgas pipelines that operatesafely.

I dont know anyonewhocares about the environmentmore than I do, he said.Laser was very cooperativeand catered to my wishes.They are going to do this in

an environmentally-friendlyway.

Mike Fiorentino, an attor-neyfor theSilver Lake Asso-ciation, an officialintervenor

in the case, said his groupwill put Laser Northeast

applicationto thetest.

MARK MORAN / THE CITIZENS VOICE

A portion of land owned by Theta Land Corp. is seen from the end of Bal-timore Drive in Plains Township. Rice Drilling B LLC, a subsidiary of Wash-ington County-based Rice Energy LLC, has applied for a permit to drill andoperate a gas well on Theta-owned property in Plain Township.

DeNaples

Company linked to developer DeNaplesproposes gas well in Plains Twp.

COVERSTORY

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THE

CITIZENSVOICE

THURSDAY,

JULY

8,

2010