ASHTABULA COUNTY — The president of Wishgard, LLC, says a high failure rate in obtaining a clear title, not a shortage of capital, is preventing his company from paying Ashtabula County landowners for their oil and gas leases.

Kip Tygard, president of Wishgard, said in Ashtabula County, the company is experiencing an 85 percent “failing initial title” rate, whereas in the Appalachian Basin, the rate is 40 percent.

Typical causes for failure are existing leases that were not released after expiration or the lease holder went out of business and never bothered to clean up the title. Or, the landowner may have purchased the well and the transaction was never recorded.

Tygard said the extra work involved in clearing those titles is costing the company, in some instances, tens of thousands of dollars per customer. The extra work is also causing delays in paying the landowners, resulting in extensions.

“Those things are being done at my cost and we are charging the landowners nothing,” Tygard said. “You got two of the most unreasonable people in the county causing these problems and by listening to them you are causing me international problems. I don’t think you understood the good Wishgard has done for them.”

Tygard was not available for comment when the first story was prepared for publication. He denied the company does not communicate with

landowners, or that there is a funding issue.

“To summarize you can blame the old oil and gas leases that were signed, real estate agents or ultimately the landowners for not taking care of their title,” Tygard said in an email.

Victoria Dresnek, interim Ashtabula County Recorder, said the issue is not with her office. “It’s not that we can’t find the records, it’s that the leasing company has not bothered to record the releases,” she said.

Tygard said Wishgard had been using an out-of-town title company to perform work in Ashtabula County until recently.

“They were doing a good job, but it was just too costly,” he said of their departure. Since then, releases have been handled through the company’s home office in Eighty-Four, Pa., and filed by the Jefferson office.

Earlier this week, the Star Beacon received complaints from area property owners who signed lease agreements with Wishgard months ago and are still awaiting payment. Several said they were promised payment within 120 days, but instead Wishgard requested they sign an extension while title work continued.

Tygard said the extensions are necessary because clearing the titles takes time and the company must have a “critical mass” of acreage before it can obtain funding and pay the landowners. He denied a lack of funding is causing the delays.

“No, we’re not broke,” he said. “Our customers have received over $200 million. We have sources that ... are willing to spend hundreds of millions dollars, with some of it designated for Ashtabula County. But they are not going to pay for anything unless there is a critical mass (of acreage).”

One county family committed 900 acres to Wishgard but, as of earlier this week, had received payment for 15 acres. Tygard said the parcels had multiple title issues the owners had not disclosed at the time of signing. The company since has agreed to release the land and “all (the owners) did is get $10,000 worth of free title work from us.”

“Despite our efforts, the (family) recently sent us a letter to release them. All companies require a letter requesting release before we go through the time and expense of releasing people at the courthouse,” Tygard said in an email. “It’s simply the honest and legal way to do business. Conversely what would happen if an unreasonable landowner called in and requested a release and then all their neighbors got paid and they did not? They would then call us back and complain.”

Tygard said the company responds within 30 days of the receipt of any such letter.

He said the examples cited in the Star Beacon’s article were the exception to the way Wishgard treats its customers.

“We have also released about 10,000 acres that we suspected had clean title,” he stated. “Some of those people have gone on to get paid, some are still waiting for a deal.”

He defended Wishgard’s 30-day time period as “ahead of the curve” and said some companies claim that they can take as long as 60 days. In Mahoning and Trumbull counties, landowners are being asked to sign nine-month contracts that allow for an additional “curative effort.”

“When Wishgard requests a release from an old oil and gas company we often have to track the company down and wait for them,” Tygard stated in the email. “Many companies respond quickly but some take all of their allotted time. This is a prime example of why extensions are a needed and common part of the industry.”