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Geothermal project at least $200K over budget

Stephen Bond / Lantern photographer

A multimillion-dollar project designed to drill geothermal wells to heat and cool South Campus is over budget and behind schedule after Ohio State paid $200,000 to a contractor whose drilling efforts failed.

Scott Conlon, Ohio State project manager, said it cost the university $200,000 alone to let the first subcontractor Chesapeake Geosystems, Inc. out of its contract.

“The university negotiated a settlement with Dugan and Meyers which included a final negotiated payment to Chesapeake for work performed, materials left behind which would be reused by the new drilling contractor, and miscellaneous incurred expenses,” Conlon said.

OSU came to a mutual agreement with the prime contractor, Dugan and Meyers, to fire the geothermal subcontractor, Chesapeake Geosystems, Inc. in April 2011.

Conlon said Chesapeake Geosystems, Inc. worked on the project from Nov. 8, 2010 to April 1, 2011. He said OSU hired Bergerson-Caswell as the new and current geothermal subcontractor on Sept. 8, 2011.

“While the contract documents allowed multiple means and methods for drilling, the method that Chesapeake used did not work well with the underlying geologic condition,” Conlon said. “Rather than force Chesapeake to continue with a drilling method that was proving less than productive, the university elected to part ways with Chesapeake and hire a new subcontractor who could employ a more suitable drilling method.”

Conlon said the total geothermal cost of the project is $10.3 million and approximately 30 percent of the construction is in place.

He also said due to the switching of subcontractors, the project will be open for student activity sometime in October 2013.

Chesapeake Geosystems, Inc. did not respond to The Lantern‘s calls on Friday, Saturday or Sunday.

Conlon said Bergerson-Caswell is using is called mud rotary method of drilling. Chesapeake Geosystems used an air rotary method. Conlon said that is the reason they turned up unsuccessful. OSU Chief Financial Officer, Geoffrey Chatas, said he knew the project was over its budget. Chatas said he estimated the total budget after the problems to be around $12 million.

“I know that the figure is a fairly significant amount,” Chatas said. “They were doing some test bores, and I know they didn’t get it right.”

President E. Gordon Gee told The Lantern about some of the problems the subcontractor ran into.

“We ran into a lot of problems in terms of getting the right holes at the right depth and to get the right geothermal power,” Gee said.

The 261 wells that were supposed to be drilled at depths of 550 to 600 feet were not finished on time, nor on budget due to the fee to let Chesapeake Geosystems out of its contract.

Gee said he was aware of the unbudgeted costs as well.

“I suspect if you go into a second contract, it’s going to cost more,” Gee said.

David Heinrich, division manager for the project’s new subcontractor, Bergerson-Caswell, said the company is just beginning work on the field next to Stradley Hall, not the bigger one in front of the Ohio Union.

“We are slowly, but consistently drilling over there,” Heinrich said. “We now have 16 or 17 borings done with just one piece.”

Heinrich said once they are done with that field, they will move over to the bigger field.

“Knock on wood, if we don’t run into any problems and everything goes as smoothly as it is now, we should be over there [to the bigger field] in no time,” he said. “We’ve had no problems with setting the heat exchangers.”

Heinrich said he has no knowledge of the previous contractor or what went on.

“The field over by the union is in pretty bad shape,” he said. “We’ve definitely got our work cut out for us over there.”

He also said Stradley Hall portion should be done by April, if everything goes according to plan.

“We are optimistic to have the project complete by spring,” Heinrich said.

The timeline that is hanging on the fence outside of the South Oval projects the timeline for the Stradley Hall site to be from September 2011 to October 2012, and the bigger field to be from May 2012 to October 2013. Originally, the project was intended to reduce OSU’s dependency on energy by utilizing the Earth’s natural energy to heat and cool residence halls on South Campus.

Voicemails to four different representatives from Dugan and Meyers went unreturned.

OSU students told The Lantern they are unsure about the progress of the construction.

“I don’t really go on that side of campus very much, but when I do, it looks really bad. There is just too much construction on campus, and it’s loud and dirty and gross,” Carrie Marks said, a second-year in marketing.

Another student, Carl Friess, a second-year in exploration, said everyday there was a new water work for him to see.

“It turned into this mass of drilling and sludge and construction. I know it’s for a good cause, but it just sucks that it’s happening now while we’re here,” he said. “It was our front yard and it was turned into a mudslide.”

Christina Castillo, a third-year in criminology and sociology, said the construction is an inconvenience.

“I have meetings in Drinko Hall and my last class is in Lazenby so when I come out, I have to walk all the way around it,” she said. “Everyone says we have such a nice campus, but this is making our campus look bad.”

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