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Airports Turn to Oil and Gas Drilling to Boost Bottom Line

8/04/2014 by

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Like other airports, Pittsburgh International supplements its revenue from airlines with fees from parking, concessions, advertising and other sources.

But now that the FAA has given its approval, “other sources” for PIT is oil and gas drilling. It has a deal with Consol Energy that came with a $50 million signing bonus and the promise of payments and royalties of an estimated $25 million annually for at least the next 20 years.

“Other airports have other advantages. They may have better flight patterns or be close to major markets,” Allegheny County Executive Rich Fitzgerald told CNBC. “But we have this natural gas that others may not have.”

Federal Aviation Administration rules restrict how airports can spend drilling dollars and other non-aeronautical revenue.

“So we can’t take this new money and put it into the jail or the court system or the park system,” said Fitzgerald. The county is using the cash to reduce landing, terminal and ramp fees paid by airlines. “That makes us more desirable and will help us attract more airlines and more flights to our airport,” he said.

Pittsburgh International isn’t the first airport to dig deep in the ground for extra revenue. Drilling contracts generate cash for Dallas/Fort Worth, spokesman David Magaña told CNBC.

DFW received a $186 million bonus from Chesapeake Energy for a natural gas exploration lease signed in 2006.

This article has been extracted from http://www.nbcnews.com, please click on this link to read the article in full http://www.nbcnews.com/business/travel/airports-turn-oil-gas-drilling-boost-bottom-line-n74046

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