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Avalon Holdings Corp. Message Board

  • edado edado Oct 23, 2013 3:31 PM Flag

    AWX looking to buy other injection wells - Part 1

    HOWLAND TOWNSHIP, Ohio -- American Water Management Services Inc. is interested in picking up the pieces left scattered by D&L Energy Inc.

    American Water, a division of American Waste Management Inc., Howland, is drilling two wastewater injection wells in Trumbull County and would like to add D&L’s abandoned projects in North Lima and Coitsville Township to that list.

    “D&L has two wells that we’ve been interested in for some time,” says Ron Klingle, chairman of Avalon Holdings, the parent company of American Water and American Waste. “We’ve been working with a lot of the investors to see if there’s an interest on their part to become part of what we’re putting together.”
    &L Energy, the embattled company whose injection well in Youngstown – Northstar #1 – was identified as the culprit behind a series of earthquakes that shook the Mahoning Valley in 2011 – filed Chapter 11 bankruptcy earlier this year. Its former president, Ben Lupo, and a former employee of an affiliated company, were charged with one count of violating the U.S. Clean Water Act. The government says that Lupo instructed the employee, Michael Guesman, to illegally discharge drilling wastewater into a storm drain that ended up contaminating a portion of the Mahoning River.

    Guesman has since pleaded guilty.

    Klingle says that his company and D&L started discussions after a 2011 New Year’s Eve earthquake in the Valley caused the state of Ohio to step in and shut down all injection well operations within a five-mile radius of the Northstar site.

    “We began having conversations with D&L right after the earthquakes, when they were not able to follow through themselves,” Klingle notes. “We weren’t able to come an agreement.”
    However, D&L’s bankruptcy has opened the door for further discussions, Klingle adds. The injection well in North Lima, on state Route 7, is nearly finished and would require only a “few more weeks” of work before operations could begin.

    “It’s in a good location and is an excellent facility,” he says. American Water is interested in acquiring just these two wells, Klingle emphasizes, and no other D&L properties or sites.

    And, he assures skeptics, American Water isn’t going to make the same mistakes that D&L did. The company’s two new wells, slated for Weathersfield Township, will comply with stringent regulations the state mandated in the wake of the Youngstown quakes.

    D&L’s well in Youngstown, for example, was drilled too deep and fractured the basement rock, Klingle says. When water was injected into the well, it lubricated a fault line, causing it to slip.

    Sentiment: Strong Buy

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