Mediator Releases Interim Report on Ryerson Negotiations
Washington PA Observer Reporter
8 February 2013
by Bob Niedbala, Staff Writer
niedbala@observer-reporter.com
A mediator attempting to settle litigation between the state and
Consol Energy regarding damage to the dam at Ryerson Station State
Park released a report Friday that includes recommendations he
said he believes can serve as a basis for resolving the dispute.
The mediator, Thomas A. Rutter, released the interim mediation
report with the approval of all parties to the case. Expanding
cracks in the concrete dam at Ryerson forced the state Department
of Conservation and Natural Resources in 2005 to drain the lake
and remove part of the dam.
DCNR filed a claim against Consol suggesting the damage was caused
by Consol’s Bailey Mine, which was mining near the park. The state
Department of Environmental Protection later determined the damage
was caused by mining and ordered Consol to restore the dam.
Denying its mining activities was to blame, Consol appealed DEP’s
decision to the state Environmental Hearing Board, where the case
is scheduled for trial in May.
Rutter’s recommendations build on a proposal he presented at a
public meeting on restoration of the dam last month.
He proposes a settlement under which Consol would pay to rebuild
the dam in return for it being allowed to drill for natural gas
beneath the park, but only from properties adjacent to the park.
Consol would be given the opportunity to lease gas resources
beneath the park. Once its drilling activities are completed on
the eight parcels of land it now owns adjacent to the park, the
company would deed those parcels to the state, which will increase
the size of the park by about one third, Rutter said.
Consol would also agree never to conduct gas drilling on the park
lands and would establish a monitoring program to address concerns
related to future mining in the area of the park.
Rutter notes an executive order has established a moratorium on
drilling in state parks, but he urged parties to consider the
proposal for reasons stated in the report.
“This matter has dragged on too long. If the parties miss this
opportunity, I fear that this case will proceed and the community
will continue to suffer while this lengthy and costly litigation
proceeds,” Rutter wrote.
The report was released at the request of DCNR secretary Richard
J. Allen.
“The report in my view provides a reasonable framework to reach a
resolution of the litigation and to restore the dam,” Allen wrote
in a letter to Rutter, which also was released.
Allen said he believes from newspaper articles and other
information he’s received that the community would support such a
resolution, but to insure the public is fully informed he
suggested the report be released.
Consol spokeswoman Lynn Seay said in an email that the company has
supported the process outlined by the mediator.
“We’re hopeful that this mediation sets a new course that takes it
out of the attorney’s hands and into a construct where all parties
can align around the common goal of restoring Ryerson dam and the
recreational aspects to the park as soon as possible,” she said.
A spokesman for the Center for Coalfield Justice, which intervened
in the case, could not be reached Friday for comment.
In his report, Rutter said he believes from discussion with the
parties that any settlement involving Consol paying a substantial
sum to resolve the claim would have to address, in exchange,
Consol’s development issues.
The company owns coal rights beneath part of the park that could
be mined in the future, he said. In addition, its subsidiary, CNX
Gas, has acquired the assets of MOB Corp. that include four gas
wells in the park.
CNX gas has not drilled any wells in the park but is interested in
doing so in conjunction with its shale gas development on the
parcels it owns adjacent to the park, he said,
DCNR has estimated the cost to rebuild the dam at $21.7 million
not including design and pre-construction services. Consol has
estimated repairs and renovations at between $10.6 and $17.6
million
Rutter said that oral and written testimony he received from about
200 individuals and groups, include more than 40 who testified at
the hearing Jan. 26, indicate people want the dam restored as soon
as possible and would accept a “reasonable resolution” to ensure
that result.
He said he heard little opposition to the settlement proposal he
presented at the hearing, which involved having Consol compensate
the state for the dam while allowing it to drill for gas beneath
the park.
Each of the parties is ready to prove its case before the hearing
board, he said. Both sides “have marshaled impressive, well
credentialed experts who support their positions.”
Parties estimate it could take three to five years to resolve the
case through administrative and appellate court proceedings.
But even if the state wins, the public will lose by the time that
has passed until the lake is restored, Rutter wrote. If the state
should lose, he added, it might find it hasn’t the money to
replace the dam itself.
Negotiation teams have made progress but the matter has come to a
“critical point” at which those involved in the mediation must
obtain authority to negotiate a settlement under terms specified
in the report.
“I may be optimistic, but if you can agree to these terms I
believe the rest of the case can be settled in short order.”
Rutter said.
Further public comment in writing is still be accepted regarding
the report. Comments can be sent to:
• Stewart L. Cohen, DCNR special counsel, Two Commerce Square,
2001 Market Street, Suite 2900, Philadelphia, Pa. 19103;
facsimile: 215-567-6019;
• Stan Geary, senior counsel, Consol Energy, 1000 Consol Energy
Drive, Canonsburg, Pa. 15317; facsimile: 724-485-4837;
• Michael Heilman, assistant regional counsel, DEP, 400 Waterfront
Drive, Pittsburgh, Pa. 15222; facsimile; 412-442-4267
• Odam Salim, Center for Coalfield Justice, University of
Pittsburgh School of Law, P.O. Box 7226, Pittsburgh Pa.
15213-0221; facsimile 412-648-1992