PULASKI TOWNSHIP, Pa. - Hilcorp Energy Company has halted an effort to force unwilling Pennsylvania landowners into allowing gas and oil well drilling under their property.

In a statement released Friday, Hilcorp says it has withdrawn its well spacing application pending before the Pennsylvania Department of Environmental Protection.

The DEP had scheduled hearings in late October on the well spacing request, which is also known by opponents as forced pooling.

Hilcorp said it wanted to establish four gas well drilling units on 3,267 acres to drill into the Utica Shale Formation in Pulaski Township, Lawrence County and Shenango Township, Mercer County.

Three property owners filed a lawsuit against Hilcorp, claiming that that the Oil and Gas Conservation law would require them to relinquish their property rights even when they don't want drilling on their land due to water concerns.

In the suit, Martin and Suzanne Matteo, Robert and Carole Valentine, and Steve Emery, argue that the more than 50 year old statute was designed for vertical drilling not horizontal drilling.

They also claim that it is an unconstitutional form of eminent domain by a private company.

Hilcorp says it is dropping the application to move forward with development operations and in keeping with the best interest of its lessors in Lawrence and Mercer Counties.

The energy company says that oil and gas development and production will continue on leased acreage in the area. Hilcorp says it plans to reform the production units to exclude the unleased tracts and activity will begin when local and DEP permits are issued.

However, Hilcorp said it remains committed to its legal position and expressed confidence that the company would have ultimately prevailed. Hilcorp says the decision is solely a business matter, not a legal one.

Hilcorp pointed out that it has successfully negotiated oil and gas leases for 99 percent of the acreage in and around Pulaski. The driller claims that landowners representing approximately one percent of the acreage opted to not sign leases.

The company says that Pennsylvania's law supporting integration of unleased mineral owners into established production units ensures fair treatment for landowners who wish to develop their oil and gas.

Hilcorp says the protracted process has created uncertainty for the landowners that have leased to Hilcorp, and wish to develop their oil and gas.

Company officials say they decided to move forward with drilling and development plans in order to provide the economic benefits to the mineral owners.