County commissioners do about-face on leasing their mineral rights | PostIndependent.com
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County commissioners do about-face on leasing their mineral rights

The Garfield County commissioners reversed themselves on a proposal to lease their mineral interests to a natural gas development company Monday. Last week the commissioners voted two to one to reject a proposal by Antero Resources to lease county-owned minerals on 19 acres at the west end of the county airport near Rifle. Commissioners Trési Houpt and John Martin apparently balked at the lease partly because Antero said it would opt for forced pooling of mineral interests on its 320-acre drilling unit near the airport if the commissioners did not agree to the lease terms.According to state law, a gas developer can apply to the Colorado Oil and Gas Conservation Commission for forced pooling when not all the mineral owners in a drilling unit agree about such development. If the COGCC approves, the drilling unit is developed with or without the consent of all mineral owners.Assistant County Administrator Jesse Smith explained the terms of the lease to the commissioners Monday. “Last week we did not have a full discussion of the lease,” he said. “It’s very good and extremely competitive.”Under the terms of the lease, the commissioners will receive a $24,000 signing bonus. The county will also get 20 percent royalties on the gas produced from the wells, as compared to 12.5 percent under forced pooling.Directional drilling from another parcel will tap the county’s minerals but not disturb the surface, Smith said.If the commissioners refused Antero’s offer and the company pursued forced pooling, in the end the county would have no choice about leasing its minerals and would also be liable for the risks of developing the wells, such as reclamation costs, he added.On Monday, Houpt reversed her decision and voted in favor of the proposal. She said she did not have enough information about the competitive nature of the lease proposal last week and so felt she could not vote for it. But after reading the terms of the contract, “It does appear to be very competitive,” she said.Martin again voted against, saying, “I disagree with the law that forces (pooling). It’s hard to swallow. For one, I don’t think the government should be forced into that.”He also said he had “nothing against Antero, it’s a matter of principle and individual rights,” but if the measure passed he would sign the contract.Houpt agreed with Martin. “Pooling seems unjust. People are being forced into a situation, but (the law) is in place.”Commissioner Larry McCown, who voted for the lease last week, reiterated his stand on the issue.”The reason I voted for it was because it was a good and prudent contract. … I didn’t anticipate it would be a problem. I said it would be a win-win for the county,” he said.Antero Resources vice president for production Terry Dobkins said the company plans to begin drilling on the county parcel “in the next couple months.”Contact Donna Gray: 945-8515, ext. 510dgray@postindependent.com


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