South Carolina-based Wastech Inc. said Wednesday it had acquired the rights to about 44,000 acres of subsurface coal, coalbed methane and all other mineral rights in various counties in West Virginia for approximately $6 million.

The deal also includes just over 5,898 acres of oil and gas reserves in Fayette County, Wastech said in a news release. The mineral rights are located on 341 properties in 24 counties.

The company said it paid for the mineral rights using a combination of stock, cash and almost $5 million in promissory notes. Wastech paid the various parties, exclusive of legal and state recording fees, 11,750,000 shares Wastech common stock, $770,000 in cash and $4.98 million in promissory notes.

“The mineral rights are owned in fee, without lien, by Wastech’s wholly owned subsidiary, Wastech of West Virginia Inc.,” in-house counsel Bill Tuorto said.

Tuorto said Wastech expects to lease the mineral rights for future drilling prospects, as well as its future energy projects, likely to its largest shareholder, Boise, Idaho-based Environmental Energy Services Inc.

EESV reached an agreement with Wastech in April to acquire 50.3 percent of its common stock. This agreement allowed Wastech to finalize acquisition of the 44,000 acres of coal leases and 5,898 lease acres of oil and gas rights in West Virginia.

EESV has had a strategic relationship with Wastech and has maintained ownership in the company for several years, said Dr. A. Leon Blaser, chairman of EESV.

“I am excited about the deep relationship we have with Wastech and the potential that exists within these specific leases,” Blaser said. “Using the reserve estimates calculated by the state of West Virginia, approximately $1 billion in coal and an additional $1 billion in oil and gas potentially exist within this project.”

Blaser said EESV is evaluating the appropriate steps necessary to open these operations.

“Drilling the gas leases will be coordinated with the current planned drilling operations in Louisiana, Arkansas and Oklahoma,” he said. “Additionally, EESV is in discussions with two potential investment groups wishing to utilize some of the coal leases for operations which will allow the company to take advantage of ... income tax credits.”

Blaser said the increase in ownership level will allow EESV to oversee and focus on the development of the energy assets owned by Wastech, which will in turn allow Wastech’s management to concentrate on the final development of its revolutionary waste transportation technology.

“Both companies are in discussions with other energy companies concerning the acquired rights for alternate leases and business opportunities,” he added.

In West Virginia it is estimated that 99 percent of the generated electricity comes from coal, utilizing within the state about 14 coal-fired electric generating facilities, amounting to $3.5 billion in gross state product generated as a result of coal.

The Associated Press contributed to this story.

— E-mail: fpace@register-herald.com

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