Grant negotiating settlement on oil lease

June 13, 2019

By Pat Maurer

A now inactive oil well, originally developed on property leased from Grant Township back in 1985 and tanks stored on the township property, are the subject of lengthy concern and now negotiations by the township board.
Superintendent Dan Dysinger explained the process of the negotiation at Tuesday’s regular board meeting. He said the well, which has not been “produced” in the past two years, and the tank “battery” are now owned by Ranch Productions LLC of Pentwater.

In an earlier meeting Dysinger said the township had never received royalties from the oil produced in earlier years.

“A prior Township Trustee, the late Jack Wolfe, attempted an investigation on the well ownership and royalty payments prior to 2004, but was at that time unable to get answers,” Dysinger said in an email after the meeting.
Dysinger added, “I started getting back into the issue in 2017, but was gathering information in Mid-2015. Previously the prior boards kept hitting dead ends.”

There are actually two oil wells attached to the storage tanks on the township property.

Dysinger explained, “The Grant 1-18 is located on township property, (property more commonly known as the old Grant Township dump in Section 18). The Gardner 1-18 is located on property owned by John Urqhardt. The Gardner Well is located about 1/4 mile north of the Grant well.”

He said both wells were part of a 1985 lease agreements with JEM Petroleum. “The installation of the wells and tanks was completed in 1986, by Bob Adams and Associates Inc. of Pentwater, MI., that company is closed.”

“Over the years lease ownership changed hands and it eventually ended up with Ranch Productions,” he said. Both wells and the storage tanks, which are on township property, are now owned by Ranch Productions.

Attorney Susan Topp, of Topp Law in Gaylord is representing the township in the negotiations and William McClintic of McClintic and McClintic in Mt. Pleasant is representing Ranch Productions.

Dysinger explained the negotiations so far and some of the township concerns.

“Topp has indicated that discussions with the attorney McClintic, are close to completing the major points of an agreement regarding the Grant 1-18 oil well.  The remaining issue which needs to be worked out deals with the tank battery.  The tank battery serves the Grant 1-18 and the Gardner 1-18.  The specific details could encompass a simple lease agreement in the event the Grant 1-18 is plugged and abandoned at some future date.  The tanks would need to remain if the Gardner well was still under production. 

Moving the tanks off the Township property would be very costly for Ranch Productions.  The Township attorney gave some options and the Board agreed that a simple agreement of lease for the land allowing the tanks to remain after discontinuance of the Grant well would be the best.  Of course if both wells are eventually plugged the tanks would be removed and the land restored.  I am confident an agreement can be reached which would work for both parties.”

Dysinger said, “The amounts being negotiated would include some past estimated royalties and legal – title search costs.” He said the amounts would be released after the agreement between the parties is reached.
In another matter at the meeting, Dysinger gave a report on road work, telling the board that the Clare County Road Commission has agreed to provide match funds ($40,000) and in-kind work for the projects scheduled this year. “They haven’t agreed to match and in-kind for 2020,” he said. “I will be watching that very closely.” He also noted that at the CCRC meeting he learned that Fahrner Asphalt is looking for new chip and seal work and that he would see if the township could save money by using them for a project this year.

In her report to the board, Clare County Clerk/Register of Deeds Lori Martin reported that the May election “went well with few problems.” She said that statewide, 15 percent of eligible voters cast a ballot and that of those who voted, 49 percent were by absentee ballot.

Dysinger voiced concern that the new equipment (voting machine) is much slower than the old and takes more time. Martin said she had received several other complaints about it, but said, “We are stuck with it for the next ten years.”

Other business at the meeting included:

*approval of a waiver from the County on PA 123 for purchasing a piece of property on White Birch Drive;

*setting a date of July 9th at 7 p.m. for a public hearing on the annual rubbish rate from $110 to $144 for township residents;

*a decision to postpone adding a 1 percent administration fee to tax bills this year. The additional fee will probably be added in 2020 to cover increased costs in assessing and tax administration;

*approved a five-year extension for right of way permits for AT&T;

*reviewed the newsletter which will be sent out with the summer tax statements;  

*approved bills totaling $27,595.07.

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