PRESTON – An interpretation of law rendered by Chenango County Attorney Richard Breslin that would limit taxpayers’ ability to profit from a natural gas well to be drilled adjacent to Preston Manor is not sitting well with members of the Chenango County Natural Gas Committee.

The opportunity, which needs to be decided by Jan. 13, represents a second time that county-owned land in the Town of Preston would be integrated into a New York State Department of Environmental Conservation spacing unit: The first, back in June of 2008, involved a 4.5 acre strip of land along county Route 10.

Thanks to a committee that is monitoring the natural gas industry locally, at least this newest compulsory integration offer is known. The first was signed by the county’s attorney and Chairman Richard Decker without the board’s knowledge. (Both involve wells drilled by contractors for Norse Energy, Inc.)

When compulsorily integrated into spacing units, landowners have three options in which to participate in the profits from production, all offering differing levels of reward and risk. It could mean the difference between a 12.5 percent share or 18 percent share of the profits, for example, or as much as 50 percent greater royalties over a number of years.

Chenango County Natural Gas Consultant Steven Palmatier suggested the county’s revenues could exceed by 10 to 20 percent what it is currently accepting under the more restrictive option.

In both instances, Breslin cited County Law Part 215 which limits negotiating any lease for a period greater then five years. Because most gas wells remain in production for 30 years or longer, Breslin has advised the county to become a non-participating owner, the least lucrative of the three choices offered at a compulsory integration hearing.

On Dec. 3, members of the gas committee attended a meeting of the Chenango County Finance Committee to suggest that Breslin revisit Law 215, paying particular attention to wording that might possibly enable a renewable lease. Supervisors Ross Iannello, unaffiliated-New Berlin, and Richard Schlag, D-German, both of whom serve on the gas committee, expressed surprise that the county’s counsel hadn’t picked up on the wording that clearly states: “renewal of a lease is allowed.” Iannello referred to a 1992 Attorney General’s opinion that agreed to allow renewals.

“We need to sell to Finance that in future years, if taxpayers find out we have screwed them out of tens of thousands of dollars of money, they are going to be angry,” said Iannello.

“We’ve already done it once,” said Natural Gas Committee Chairman Peter C. Flanagan, D-Preston.