2009-04-16 / Local & State

Pa. Officials Say Drilling Lease Falls Through

By Marc Levy ASSOCIATED PRESS WRITER

HARRISBURG, Pa. (AP) - A natural gas exploration company has told Pennsylvania officials it won't sign leases worth $31 million for the right to drill on state forest land.

The revelation potentially means more budget trouble for Gov. Ed Rendell.

Spokeswoman Chris Novak of the state Department of Conservation and Natural Resources said Thursday that she didn't know why Seneca Resources Corp. made the decision.

A Seneca spokeswoman didn't answer her telephone Thursday morning.

In December, Rendell announced plans to tap most of the $190 million that exploration companies had bid last year for the right to drill on 74,000 acres of state forest.

Rendell says he needs the money to help fill a gaping shortfall in the state's budget.

Seneca has executed leases on two other tracts on which it bid successfully.

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