CONSOL Energy settles with Pa. DCNR for $36 million over damage to state parkland

CONSOL Energy Inc. has agreed to pay the Commonwealth of Pennsylvania a hefty $36

million to go toward the replacement of a dam at a state park in the southwestern part of the state, according to the state’s Department of Conservation and Natural Resources.

The DCNR announced last week that the recently reached settlement would restore Duke Lake at Ryerson Station State Park in Greene County, which had to be drained in July 2005 for safety reasons after inspectors discovered cracks and water seepage in the dam.

The lake is expected to be restored by the summer of 2017.

“Greene County lost a significant recreational resource when the lake was drawn down, and many residents and community members expressed the need to get the dam replaced as soon as possible,” DCNR Secretary Richard Allan said in a statement. “This resolution will put us on the fastest track possible to bring back Duke Lake, and as an added bonus, will result in 506 additional acres of land for the park, an increase of more than 40 percent of the total current acreage.”

For years, the DCNR and CONSOL Energy were embroiled in litigation in which the state agency claimed that an investigation by the Department of Environmental Protection uncovered that the dam and lake had been damages by longwall mining in the area.

DCNR is currently filing court papers stating that the lawsuit has been settled, the agency announced, and CONSOL is withdrawing the appeals it had filed with the state Environmental Hearing Board.

The settlement agreement arose out of a two-month mediation process and public comment period, according to the DCNR.

As per the terms of the settlement, CONSOL has stipulated to the following:

It will pay the state the $36 million to be used toward the dam’s replacement; give DCNR 506 acres of land bordering the park to be added to the park’s total recreational space; construct a park maintenance building; monitor stream flows and ground movement with DEP oversight; be barred from mining beneath the dam and Duke Lake; be prohibited from using any of the park’s water for drilling activities; and agree to not drill on state park lands, including the area where CONSOL is already legally allowed to drill by current rights.

DCNR, on the other hand, will receive an 18 percent royalty payment for gas production from wells situated underneath the park, after the $13.7 million that will be realized by CONSOL, which will be filtered into the Oil and Gas Lease Fund; allow CONSOL to drill for natural gas beneath the parkland, but only from well pads outside park boundaries; and allow longwall mining under a portion of the park should CONSOL obtain the required environmental permits.

The state DEP expects CONSOL to receive its final permit for the project in October 2014, which would be followed by competitive bidding and conclude with an anticipated construction start date of around the spring of 2015, according to DCNR.

Ryerston Station State Park, which comprises more than a thousand acres of land, is situated in a corner of southwestern Pennsylvania near the West Virginia border.