Man pleads guilty in scheme to falsely sell mineral rights to Marcellus Shale gas drillers

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One of two men accused of involvement in an elaborate fraud that resulted in the sales of millions of dollars of bogus mineral rights to gas drilling companies pleaded guilty today.

William J. Ray, 29, of Monroeville, pleaded guilty to one count of mail fraud and could face about three years in prison under federal guidelines when he is sentenced on Jan. 10.

Mr. Ray's accused business partner, Derek A. Candelore, 33, of Jeannette, has pleaded not guilty to similar charges. The two were "landmen," securing drilling leases for sale to firms working in the Marcellus Shale.

According to assistant U.S. attorney Nelson Cohen, the two wrote up and filed false deeds and forged the signatures of property owners, transferring mineral rights to "bogus companies" they created.

"They thereafter sold and leased the mineral rights to Range Resources" and other companies, he said.

Questioned by U.S. District Judge Arthur J. Schwab, Mr. Cohen said the two fraudulently sold the rights to drill on some 40 Washington County properties for about $2.4 million.

In addition to a potential prison term, Mr. Ray has agreed to forfeit $543,146 and to pay restitution from future earnings.

Range Resources discovered the fraud when different employees of the firm realized that they were negotiating with different people for rights to drill on the same property.

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Rich Lord: or 412-263-1542. Twitter: @richelord.


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