Columbiana County managed to double its money through a deal with DPS Penn to lease hundreds of acres for Utica Shale drilling, breaking the record for highest signing bonus to any government body. The August 2011 lease agreement of $2,700 per acre more than doubled when Commissioner Chairman Mike Halleck signed a lease agreement this week for $5,850 per acre.
The 548-acre lease with DPS Penn, an agent for Chesapeake Energy, will bring in $3.2 million to the county, along with 20 percent royalties on any gross revenue received. The county also managed to sign for a three year lease, as opposed to the usual five year lease. The $5,850 per acre lease now holds the record as the highest lease fee paid to a government by $50.
With so much money suddenly headed in the county’s direction, Halleck says discussions on how to spend it are imminent. Halleck says he would like to see the money go toward a fund he started during his first term. The “rainy-day fund” consisted of unspent revenue from commissioners and was to be used for special projects and/or emergencies. “We did that years ago and it came in handy,” said Halleck.
This is not the only shale-related money coming to the county. The county will also be receiving payment from Cardinal Gas Services, LLC with whom they signed an agreement to run a pipeline across county-owned property. Halleck, who was granted full authority from commissioners to negotiate and sign all of the leases, is clearly taking advantage of the boom in the shale gas industry. As this industry continues to take off in the manner it is, signing bonuses of this magnitude could very well become more common, totally shattering this current record.