TERRE HAUTE — Indiana State University is considering an oil and gas lease with Pioneer Oil Co. based in Lawrenceville, Ill.
The lease would allow Pioneer to explore, drill, produce and transport any oil and gas resources on ISU property in Terre Haute.
On Friday, the ISU board of trustees will be asked to approve the “substantive provisions” of the agreement and authorize the vice president for business affairs to negotiate and execute a contract.
“We’ve looked at doing this various times over the years,” said Diann McKee, ISU vice president for business affairs. “Certainly, the price of oil now, along with advances in technology, make it more feasible.”
Because of advances in technology, the company can drill horizontally underground from the perimeter of campus, she said.
The first step would be for the company to do a survey to determine the extent of oil resources, she said.
If oil is found, recovering it “would be done in such a way as to minimize any disruption to campus,” she said.
Any potential revenue ISU might receive would be viewed as “somewhat one-time in nature,” she said. “It is not something we would plan on using for ongoing operations.”
Under terms of a proposed agreement, the university would receive royalty payments of at least 15 percent for all oil that is produced. Pioneer also would provide an upfront fee yet to be negotiated, according to information that will be presented to trustees Friday.
ISU and Pioneer have been in discussion and have reached agreement “on certain substantive terms” of a lease that would remain in force for 730 days from the effective date of the agreement and as long afterward as oil or gas is produced or is being developed or operated.
The university would control the location of any equipment and drilling “to ensure the integrity of the main campus is preserved.”
McKee noted that in the late 1800s and early 1900s, oil wells did exist on what is now the eastern part of ISU property. “When we paved the back part of a parking lot of Hulman Center about eight years ago, there was an old well” that was then capped. A neighboring commercial establishment that was expanding also found and capped an oil well.
In a separate matter, this fall, ISU wants to conduct a pilot project involving electronic textbooks.
The study would involve a limited number of undergraduate courses that would include electronic textbooks; those courses would incorporate into their costs the purchase of the e-textbooks.
Students enrolled in those courses would be assessed an e-textbook fee, based on the following: The publisher price that Barnes & Noble will be charged, plus the Barnes & Noble contractual mark-up and an ISU administrative fee to cover bad debt and other administrative costs.
On Friday, the board of trustees will be asked to approve the e-textbook fee.
“This is a pilot to evaluate how this might work and students’ reaction to it,” McKee said.
The intent is to provide a lower cost alternative to the purchase of hardback textbooks, she said. “Obviously, this may be where we are headed with textbooks.”
Courses used in the study also will include sections that use traditional paper textbooks.