The Herald Bulletin

September 9, 2013

Indiana State gives permission for company to drill


The Associated Press

TERRE HAUTE, Ind. —  Indiana State University is hoping to join in on the ongoing oil boom in Vigo County.

The university has given permission for Pioneer Oil of Lawrenceville, Ill., to drill on university-owned land, the Tribune-Star reports. Indiana State President Dan Bradley, a former professor of petroleum engineering, says Pioneer believes there is "significant" potential for oil production under the campus in Terre Haute in western Indiana.

The drilling won't cost university anything, but it would receive royalties if oil is found. Bradley says other property owners downtown are also being contacted about possible drilling.

Interest in Vigo County oil really took off after Indianapolis-based CountryMark made a significant oil find on property belonging to the Hulman family that owns the Indianapolis Motor Speedway. The strike was producing as many as 2,000 barrels per day for a time, CountryMark Chief Executive Officer Charlie Smith said.

"There's nothing that attracts attention and interest like someone who has had success," said Herschel McDivitt, DNR's director of the division of oil and gas.

Since then, the Indiana Department of Natural Resources has issued seen oil permits go from one in 2010, to 18 in 2011, to 25 in 2012. The DNR says nine permits have been issued so far in 2013.

Pioneer Chief Financial Officer Steve Miller says drilling on the Indiana State campus is made possible by improved technology. He says Pioneer likely will drill straight down more than 1,000 feet and then turn its drilling equipment to run horizontally.

"It's incredibly sophisticated stuff," Bradley said.

Pioneer has experience drilling in unconventional locations. The company has a well on the campus of the University of Southern Indiana and also drills in New Harmony State Park, Miller said.

Miller says Pioneer has already drilled a saltwater disposal at Indiana State, an expense not normally incurred until after oil is confirmed.

The new interest in oil production in the county has also triggered concern. The City Council recently imposed a moratorium on hydraulic fracturing, better known as "fracking," within the city limits.