39.4 F
Fort Worth
Wednesday, October 28, 2020
Energy South Dakota, Texas company at odds over bond meant for wells

South Dakota, Texas company at odds over bond meant for wells

Other News

Who killed Sweden’s prime minister? 1986 assassination of Olof Palme is finally solved – maybe

Andrew Nestingen, University of Washington It took 34 years,...

Fort Worth Police seeking man who robbed diners on Southside restaurant patio

Fort Worth Police are seeking a man who robbed diners at an outdoor patio on Hemphill Street on the city's Southside.

Authorities find 2 abducted girls after 2 boys are killed

By HEATHER HOLLINGSWORTH The Associated PressMISSION, Kan. (AP) — Authorities found two girls who were abducted from a Kansas home where two...

Second whistleblower fired from Texas attorney general’s office after accusing Ken Paxton of bribery

By Emma Platoff, The Texas Tribune Oct. 22, 2020 "Second whistleblower fired from Texas...

BUFFALO, S.D. (AP) — An oil and gas exploration company is alleging its officials cashed out a $20,000 certificate of deposit intended to serve as a bond for 40 idled natural gas wells in South Dakota because they forgot the money’s purpose.

New Braunfels, Texas-based Spyglass Cedar Creek LP filed a petition last week opposing South Dakota’s revocation of the company’s permits for the wells near Buffalo, the Rapid City Journal reported . A state hearing on the permits is scheduled for Oct. 18.

The South Dakota Department of Environment and Natural Resources started proceedings to revoke the permits last month over the project’s non-compliance with state regulations. The project began in 2006 but ran into multiple issues, including a drop in natural gas prices, a lender’s bankruptcy and at least four lawsuits.

The department discovered last month that former Spyglass partner Kevin Sellers cashed out the $20,000 in 2015. The deposit was meant to help the state pay for plugging the wells if Spyglass couldn’t complete the work.

Sellers’ transaction occurred after a bank notified the company that Texas officials were trying to claim the deposit as abandoned property, said March Kimmel, general partner of Spyglass.

“At the time the bank insisted that the account be closed; neither Mr. Kimmel nor Mr. Seller(s) has any personal recollection of the documentation to the effect that the certificate served as collateral for any obligations to the state,” Kimmel wrote in his petition. “The bank’s correspondence did not indicate that it was being held for such purpose, nor did it indicate there was any requirement that DENR agree to termination of the account.”

The deposit loss leaves state regulators with less than $10,000 from a separate bond to use to manage the idled wells. Officials estimated that plugging the wells could cost more than $850,000.

Kimmel said he hopes to resurrect the project and that Spyglass is working with at least two investors interested in providing funding. But the department’s attempt to revoke the permits will stop such goals, he said.

“Essentially Spyglass cannot give any potential equity partners the assurance they need without assistance and assurance of cooperation or a stay of action against the project from the state,” he wrote.

___

Information from: Rapid City Journal, http://www.rapidcityjournal.com

Latest News

A week before the election, Texas National Guard prepares to deploy troops to cities

By Shawn Mulcahy, The Texas Tribune Oct. 27, 2020 "A week before the election,...

Polls, late campaign activity suggest Republican dominance in Texas could be at risk

By Alex Samuels and Patrick Svitek, The Texas Tribune Oct. 27, 2020 "Polls, late...

Michael Bloomberg to spend $15 million on TV ads for Biden in Texas and Ohio after seeing tight polling

By Alex Samuels, The Texas Tribune Oct. 27, 2020 "Michael Bloomberg to spend $15...

Barrett sworn in at Supreme Court as issues important to Trump await

By MARK SHERMAN Associated Press WASHINGTON (AP) — Amy Coney Barrett was formally sworn in Tuesday as the Supreme...

As Ken Paxton battles scandal, Land Commissioner George P. Bush considering a 2022 run for attorney general

By Emma Platoff and Cassandra Pollock, The Texas Tribune Oct. 26, 2020 "As Ken...