Fortuna Energy Inc. and the New York State Attorney General’s Office have come to an agreement on a new set of business practices for negotiating natural gas exploration leases, the Attorney General’s Office announced last month.

The agreement comes at the end of an investigation that began during the fall of 2004, when landowners complained that Fortuna and other energy companies used misleading information and pressure tactics, and discouraged them from consulting attorneys, as the companies pursued leases.

Also, Fortuna, which has offices on Colonial Drive in Horseheads, paid $100,000 to cover the cost of the investigation, plus an additional $51,596 in royalties to some landowners. The figure represents marketing fees charged to Fortuna, which the company incorrectly deducted from gross revenues before distributing the royalties. Fortuna’s president, James O’Driscoll, said the company is happy the investigation has come to a conclusion.

“There is an overriding desire for Fortuna to have good relations with our landowners, and this is something we have been very sensitive of since we began our operations in the Twin Tiers,” he said.

With the agreement now in place, Ashur Terwilliger, head of the Chemung County chapter of the New York Farm Bureau, said the state Department of Environmental Conservation is the next entity that needs to be “brought in line.”

The Farm Bureau is one of several groups that are championing the rights of landowners in the natural gas leasing issue. “(DEC) sold us down the drain,” Terwilliger said. “I’ve been arguing for years that DEC should make it so you have to bid out the royalties. That’s where the money is. The upfront money is here today and gone tomorrow. The royalty payment is the money that lasts.”

Terwilliger also said the agreement will have a limited effect on lease negotiations, since Fortuna and other energy companies usually hire third-party contractors, who might not be fully aware of the new business practices for obtaining leases, to secure the agreements. — (Elmira, N.Y.) Star-Gazette