Town Looking at Possible $4-5 Million Windfall
and Bruce Yarnall, Barnesville Area News
Village Administrator Roger Deal opened bids for oil and gas leasing at the August 25 village council meeting.
Two bids were received from Grenadier Energy Partners III and Gulfport Energy Corporation.
Gulfport, represented at the meeting by Brett Marlow, bid $8,250 an acre for the proposed bonus and proposed royalty is 20% with a term of five-years and a five-year option to extend.
Grenadier’s proposal was a bonus of $7,000 per acre and proposed royalty of 20% with a five (5) year primary lease along with a five (5) year extension option. Nathan Lambert, VP Land for Grenadier, was present at the meeting.
The bonus rates for the two firms would net the village between $4-5 million dollars at the time of signing.
Both representatives said the estimated acreage available for leasing was around 598 acres with much of the land in Somerset Township surrounding Slope Creek Reservoir.
Marlow said that Gulfport would not need to develop any new pad locations because they could access the lease area with existing equipment.
Lambert said Grenadier would need to develop new pads, an easy task.
Mayor Jake Hershberger added Grenadier currently has over 9,000 acres leased from landowners in the village.
Councilmember Terry McCort said it was important the town do whatever it can to help benefit village landowners.
During the two previous bid openings, Grenadier was the high bidder and successful contractor between the two firms.
Times may have changed recently as noted in Marcellus Daily News, an industry publication, on August 7. Gulfport’s CEO John Reinhart said at the firm’s quarterly update on August 6, the company is planning to spend up to $100 million in the coming months to lease more acreage, primarily in Belmont but also some in Monroe County.
Both men answered council members’ questions during the exchange.
The bids were turned over to Richard Myser, village solicitor, to review. He will report back to the body at the September 8 council meeting.
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