Shale Gas Drilling to Add 870,000 Jobs by 2015

On Sunday, December 11, 2011 0 comments

Producing natural gas from shale will support 870,000 U.S. jobs and add $118 billion to economic growth in the next four years, according to a report from IHS Global Insight.

Gas from shale, which accounts for 34 percent of U.S. output, also will contribute $57 billion in federal, state and local taxes by 2035, or $933 billion in the next 25 years, according to today’s IHS report, commissioned by America’s Natural Gas Alliance, a Washington-based industry group.

Shale gas is extracted using hydraulic fracturing, a process in which millions of gallons of chemically treated water and sand is forced underground, breaking up the rock to free trapped gas. Industry expansion is adding jobs in an otherwise disappointing economy, said John Larson, a vice president at Lexington, Massachusetts-based IHS, a management consulting company for the energy industry.

“Shale gas combines a capital-intensive industry with a broad domestic supply chain,” Larson said in an interview. “We think that these jobs through 2015 are net new jobs because of high unemployment.”

Environmental groups have said the process, also called fracking, has tainted drinking water in states such as Pennsylvania, where 4,100 wells have been drilled. About 1,900 people, most opposed to fracking, attended a New York City hearing on Nov. 30 to consider state rules for drilling.

Conclusions Questioned

Food and Water Watch, which advocates a ban on fracking, said IHS didn’t provide a detailed methodology, making it impossible to validate the projections. The report also ignores potential job losses, Emily Wurth, the Washington-based group’s water policy director, said today in an e-mail.

“The analysis fails to account for the job losses to agriculture and tourism caused by intensive shale gas development,” Wurth said.

Financial forecasts by IHS include direct jobs in the drilling industry plus an “employment multiplier.” For every direct job added, more than three indirect and induced jobs are created, according to the report.
The forecast excluded potential drilling in New York, which has placed a moratorium on fracking while it develops drilling regulations, or the impact of U.S. service companies supplying drilling in Canada, Larson said.

“Given those sort of factors, we feel that what we’ve presented here is a very conservative estimate,” Larson said.

Cost Cuts

The shale-gas contribution to U.S. gross domestic product will triple to $231 billion in 2036 from $76 billion last year, the report found. Lower natural gas prices as shale boosts supply will cut U.S. electricity costs by an average of 10 percent, the report found. Lower prices will raise industrial production 2.9 percent by 2017 and 4.7 percent by 2035.

“IHS appears to have included payments to landowners as capital expenditures by the gas industry that create direct jobs,” Wurth said. “Lease and royalty payments do not create direct jobs and do not lead to any indirect jobs.”

Food and Water Watch found in a November report that projections for the number of shale-industry jobs in New York led to a “gross exaggeration” of the gains, Wurth said.

A 2011 report by the Public Policy Institute of New York State, an Albany-based research group, found that by 2018, developing 500 shale gas wells a year in five counties would create 62,620 jobs. After correcting the “flawed” job multiplier, the number was closer to 6,656 jobs, Wurth said.

“Very few people have analyzed these reports,” Wurth said. “That’s unfortunate because a lot of elected officials take these studies as factually based.”

Read the original article here.

Gas Well Leases: Lesson Learned Too Late

On Saturday, December 10, 2011 0 comments

After Scott Ely and his father talked with salesmen from an energy company about signing the lease allowing gas drilling on their land in northeastern Pennsylvania, he said he felt certain it required the company to leave the property as good as new.

So Mr. Ely said he was surprised several years later when the drilling company, Cabot Oil and Gas, informed them that rather than draining and hauling away the toxic drilling sludge stored in large waste ponds on the property, it would leave the waste, cover it with dirt and seed the area with grass. He knew that waste pond liners can leak, seeping contaminated waste. 

“I guess our terms should have been clearer” about requiring the company to remove the waste pits after drilling, said Mr. Ely, of Dimock, Pa., who sued Cabot after his drinking water from a separate property was contaminated. “We learned that the hard way.”

Americans have signed millions of leases allowing companies to drill for oil and natural gas on their land in recent years. But some of these landowners — often in rural areas, and eager for quick payouts — are finding out too late what is, and what is not, in the fine print.

Energy company officials say that standard leases include language that protects landowners. But a review of more than 111,000 leases, addenda and related documents by The New York Times suggests otherwise:

  • Fewer than half the leases require companies to compensate landowners for water contamination after drilling begins. And only about half the documents have language that lawyers suggest should be included to require payment for damages to livestock or crops. 
  • Most leases grant gas companies broad rights to decide where they can cut down trees, store chemicals, build roads and drill. Companies are also permitted to operate generators and spotlights through the night near homes during drilling.
  • In the leases, drilling companies rarely describe to landowners the potential environmental and other risks that federal laws require them to disclose in filings to investors.
  • Most leases are for three or five years, but at least two-thirds of those reviewed by The Times allow extensions without additional approval from landowners. If landowners have second thoughts about drilling on their land or want to negotiate for more money, they may be out of luck.
The leases — obtained through open records requests — are mostly from gas-rich areas in Texas, but also in Maryland, New York, Ohio, Pennsylvania and West Virginia.

In Pennsylvania, Colorado and West Virginia, some landowners have had to spend hundreds of dollars a month to buy bottled water or maintain large tanks, known as water buffaloes, for drinking water in their front yards. They said they learned only after the fact that the leases did not require gas companies to pay for replacement drinking water if their wells were contaminated, and despite state regulations, not all costs were covered.

Thousands of landowners in Virginia, Pennsylvania and Texas have joined class action lawsuits claiming that they were paid less than they expected because gas companies deducted costs like hauling chemicals to the well site or transporting the gas to market.

Some industry officials say the criticism of their business practices is misguided. Asked about the waste pits on Mr. Ely’s land in Pennsylvania, for example, George Stark, a Cabot spokesman, said the company’s cleanup measures met or exceeded state requirements. And the door-to-door salesmen, commonly known as landmen, who pitch the leases on behalf of the drilling companies also dismiss similar complaints from landowners, and say they do not mislead anyone.

Read the entire article by the New York Times... 

DEP Boss in Erie to Talk Marcellus Shale

On Thursday, November 3, 2011 0 comments

The head of Pennsylvania's Department of Environmental Protection was in Erie Thursday, talking about Marcellus Shale gas drilling.

DEP Secretary Mike Krancer told member of the Erie Rotary Club that he is confident state lawmakers will pass some sort of impact fee in the near future.

Meanwhile, Pennsylvania Governor Tom Corbett remains opposed to any actual tax on drillers, he is willing to embrace a fee to help communities affected by the shale gas boom. 

DEP Secretary thinks the house and senate will come up with a compromise bill soon.

Krancer said, "Well I hope in the next several weeks it will be passed by the legislature. The governor has done his part. Now it is time for the legislature to act. "How will it help townships and municipalities? Well it will bring funds to address uncompensated costs for the drilling as the Marcellus Shale Advisory Commission pointed out."

State lawmakers are also considering how much control local governments should have over drilling.

PA Industry Group to Disclose Drilling Chemicals

On Friday, October 21, 2011 0 comments

Associated Press PITTSBURGH — Members of the leading Marcellus Shale industry group in Pennsylvania will voluntarily disclose chemicals used in each natural gas well as of Jan. 1, the organization said. An environmental group applauded the move, but said it's not enough.

The Marcellus Shale Coalition represents many of the largest gas drillers in Pennsylvania. The drillers use a process called fracking, which forces millions of gallons of water, mixed with sand and chemicals, deep into shale formations to free the gas.

The industry believes the process is safe, but environmental groups and people who live in drilling areas have worried about the exact chemicals used in each well, and the possibility of groundwater contamination.

Kathryn Klaber, president of the Marcellus coalition, said that the full disclosure was an "obvious choice" that the group's members had no problem supporting. The disclosure will be mandatory for members, who will list the chemicals used in each well on the website

"You want to make sure the transparency is worked in to everything we do," Klaber said.

The state of Pennsylvania already requires drillers to list all chemicals used in drilling on a website. But that doesn't tell people what's being used in a specific well near them.

Klaber said the group wanted to go beyond what the state requires.

Jan Jarrett, president of the environmental group PennFuture, said she applauds the decision by the Marcellus Shale Coalition.

"I'm not saying it's a bad thing for them to voluntarily do it," Jarrett said.

But Jarrett said that is no protection against firms that aren't members of the coalition, which companies join voluntarily.

"This is a matter of public policy. And it's really a proper role of government to set these kinds of rules," Jarrett said. She called for the state to make the disclosure of chemicals used in each well mandatory for all drillers.


On the web:
—Copyright 2011 Associated Press

Shale-Related Plant Coming to Altoona

On Tuesday, October 18, 2011 0 comments

The Altoona area will share in the growth from the Marcellus Shale natural gas boom with Gardner Denver's construction this winter of a 70,000-square-foot manufacturing plant near Tipton.

The $15 million project will create 40 jobs within three years, according to Marty Marasco, CEO of Altoona Blair County Development Corp., which helped broker the deal.

The company will manufacture and remanufacture "fluid ends" on big high-pressure pumps, Marasco said.

Average pay will be $42,000, with a few management jobs requiring college educations and production jobs requiring machine-oriented experience, according to Marasco.

The company will try to hire as many workers as possible from central Pennsylvania, he said.
Gardner Denver chose Blair County because it's midway between the two poles of Marcellus activity in northeast and southwest Pennsylvania, and the company chose Tipton in particular because of its easy access to Interstate 99, according to Marasco.

Last year, Gardner Denver moved its headquarters from Illinois to Wayne, Pa., bucking a decadeslong trend, thanks to the lure of the burgeoning Marcellus Shale industry, which the equipment manufacturer serves.

The development corporation has been angling to take advantage of "downstream" Marcellus activities since the beginning of the boom, Marasco said.

Although some existing Blair County firms have been selling Marcellus products and services, "this is the first direct success," he said.

The company made the first contact in its search for a site for the plant.
"The location sold itself," Marasco said.

Gardner Denver will be the first tenant in the I-99 Enterprise Campus Business and Industrial Park on Old Route 220 about half a mile south of Del Grosso's Amusement Park and across from an S&A Homes development.

The company will take two lots comprising 10 acres.

Utilities and a highway occupancy permit are already in place.
Founded in 1859, Gardner Denver is a "global manufacturer of industrial compressors, blowers, pumps, loading arms and fuel systems," according to the company's website. The firm has 40 plants worldwide, with offices in 36 countries and revenues of about $2 billion a year, according to the company website.

Work on the project in Antis Township began about two weeks ago and should finish in March, when production will begin, according to Marasco.

Neyer Inc. of Cincinnati will be constructing a 32-foot high, single-story building of prefabricated concrete panels shipped to the site.
Workers will outfit the production area with cranes.

The building will include 5,000 square feet of office space.

Gardner Denver is also building plants in Pittsburgh and Fort Worth to accommodate Marcellus demand, according to Marasco.

ABCD is serving as developer for the project, although it normally prefers not to take that role, Marasco said.

Gardner Denver received a $200,000 Pennsylvania First Grant and $18,000 in job training assistance, according to a news release from the governor's office.

The Governor's Action Team, First National Bank, the Pennsylvania Industrial Development Authority, Penelec, the Altoona City Authority, Northern Blair Regional Sewer Authority, the Blair County Soil and Conservation District and the Blair County and Antis Township planning commissions participated in the project, according to an ABCD news release.

The rest of the business park is already "spoken for" by two other potential tenants - although one may opt for another Blair County location, Marasco said.

"It's a great investment," Marasco said of the Gardner Denver project. "It's kind of an image builder for the Marcellus Shale industry - that a company like Gardner Denver would consider the Altoona area and the I-99 corridor."

Read the Entire article here.

Shale Gas Contract Heads to Supreme Court

On Wednesday, October 12, 2011 0 comments

(HARRISBURG) A case raising doubts about whether Pennsylvania's booming natural gas industry has the right to extract the methane from the thick shale more than a mile beneath countless properties is being appealed to the state's high court.

A Susquehanna County couple on Friday asked the Supreme Court to reinforce that a nearly 130-year-old ruling applies to the Marcellus Shale, which lies underneath much of Pennsylvania and is considered the nation's largest-known natural gas reservoir.

The appeal was motivated by a lower Superior Court action last month suggesting that perhaps the 1882 case cannot be used to separate mineral rights from gas rights in the case of the Marcellus Shale.
"Even if it was unintentional, the Superior Court did call it into question, perhaps not intentionally, but inadvertently, call into question longstanding law on what the term `mineral' means," said Gregory Krock, a Pittsburgh lawyer representing the couple. "But you also have to realize the case is at an early stage."

The Supreme Court must decide whether to hear the appeal.

If the courts decide that mineral rights do not cover the gas from the Marcellus Shale, it could upend some of the leases between property owners and the natural gas industry exploring the Marcellus Shale, some lawyers say.

A lot of leases say a lot of different things, especially over the years, and some are more specific than others, Krock said.

The case stems from a dispute between John E. and Mary Josephine Butler and a man named Charles Powers and his heirs.

The deed for the Butler's 244 acres in Apolacon Township splits "minerals and petroleum oils" between the parties in a land deal that originated in 1881. Natural gas rights were not mentioned, so all of the gas should still belong to the property, the Butlers contend.

A Susquehanna County judge agreed, citing the precedent the state Supreme Court set in the 1882 case, Dunham v. Kirkpatrick.

But Powers' heirs appealed, and a Superior Court panel last month said it could not say with certainty that Powers' heirs have no claim to the gas. The parties should have the opportunity to assemble expert testimony on whether the Marcellus Shale is a mineral and whether the gas it holds falls within the deed, the panel said.

It ordered a county judge to hold further hearings take expert testimony on whether the Marcellus Shale is a mineral, and whether the owners of the mineral rights or the gas rights own the gas it holds.
More than 3,000 wells have been drilled into the Marcellus Shale in the past three years and thousands more are planned in the coming years.

Read the original article here.

PA Landowners File Appeal in Marcellus Shale Ruling

On Tuesday, October 11, 2011 0 comments

Oct. 7 (Bloomberg) -- A Pennsylvania couple has asked the state’s Supreme Court to throw out a lower court’s decision dealing with ownership of natural gas on their land.

John and Mary Butler said in a filing today that the state Superior Court erred when it interpreted state law regarding mineral rights in the Marcellus Shale gas field.

“The Superior Court’s ruling could have a profound impact upon landowners and businesses in Pennsylvania,” the Butlers said in their appeal. They asked the court to uphold a county court verdict that gave them title to the gas.

Two other people had claimed partial ownership of the gas beneath the Butlers’ 244 acres in Susquehanna County. The Superior Court said Sept. 7 there was enough evidence to hold further hearings, saying Pennsylvania law is unclear whether shale gas is a mineral.

Under an 1882 court decision, ownership of oil and gas has to be transferred separately from other minerals. Legal experts said the Superior Court’s decision may cloud the title to other gas leases in the Marcellus Shale in Pennsylvania, where exploration companies such as Range Resources Corp. and Chesapeake Energy Corp. have leased millions of acres.

The case is Butler v. Charles Powers Estate, 1795-mda-2010, Superior Court of Pennsylvania.

NY Doctors to Perform Health Study of Gas Drilling

On Friday, October 7, 2011 0 comments

ALBANY, N.Y. — More than 250 doctors and other health care professionals have signed a letter to Gov. Andrew Cuomo seeking a comprehensive human health study of the state's proposal to permit new deep drilling for natural gas across the Marcellus Shale region of upstate New York.
The Department of Environmental Conservation's draft analysis of hydraulic fracturing for natural gas omits that critical issue, according to the letter dated Wednesday and released to reporters. It also said the state health department has declined to do that requested assessment on grounds it wouldn't provide significant new information that is not already being covered.

The doctors said they disagree and claim growing evidence from industrial gas development in other states shows worsening health among people living near gas wells, compressor stations and waste pits.

The DEC environmental analysis contains "glaring omissions with respect to human health," said Dr. Adam Law, an endocrinologist from Ithaca. A board member of the group Physicians Scientists & Engineers for Healthy Energy, he signed the letter.

Biologist Sandra Steingraber, who also signed it, said estimates of up to 77,000 upstate gas wells involving 1,000 truck trips each would make low-level air pollution a certainty, with estimated health costs that can be calculated.

"This kind of air pollution is lethal," she said.

The letter was also forwarded to the health department and the DEC, which is taking public comments on its draft analysis and regulations and plans to issue final regulations followed by new drilling permits, possibly starting in late fall or early winter. It has proposed rules for permitting gas-drilling companies to pump water, chemicals and sand into deep wells at high pressure to release natural gas from shale, a process known as "hydrofracking."

"Because New York has developed the most rigorous requirements in the nation to protect the public health and the environment, a comparison of health impacts in other states is inappropriate," DEC spokeswoman Emily DeSantis said. She said the draft analysis "thoroughly reviews the causes of potential health impacts in other states and the proposed requirements are designed to prevent them."

The agency analyzed additional truck emissions and found they would have "minimal" effect on air quality, DeSantis said. "Even so, DEC will assess and monitor air quality impacts near drilling operations and regionally," she said.

Health Department spokesman Peter Constantakes said that agency worked with DEC in "a thorough review" of potential health impacts and measures to avoid them. "Another health impact assessment is not necessary," he said.

Drilling advocates say it will bring an economic infusion to New York and that the health concerns are addressed in the DEC analysis and the many state, federal and local laws the industry adheres to daily. The Independent Oil & Gas Association said the regulations and permit limits will be in place "to prevent pathways to humans and the environment."

DEC Commissioner Joe Martens has said that hydraulic fracturing can be done safely with proper precautions. The DEC would prohibit the drilling in the New York City and Syracuse watersheds, on state land and within primary aquifers.

Its proposals include no drilling permits within 500 feet of a private water well or within 2,000 feet of a public drinking water well or reservoir, generally requiring a third casing around each well to prevent gas leaks, requiring watertight tanks to contain flowback water and a DEC-approved plan for disposal of waste water or brine. Applicants would have to fully disclose all chemicals used.

—Copyright 2011 Associated Press

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PA May Levy New Tax on Marcellus Shale

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Pennsylvania Gov. Tom Corbett has issued a proposal that, if passed, would allow counties in the Keystone State to impose fees on Marcellus Shale natural gas drilling.

County commissions in Pennsylvania are split on whether to support the Republican governor's proposal.

Kanawha County Commission President Kent Carper does not think this would be a good idea for West Virginia.

"It's just a new tax," Carper said. "And I don't support new taxes."

Instead, Carper wants state lawmakers to distribute severance tax funds that already are in place directly to cities and counties with roads that are damaged by industry trucks.

"The counties and municipalities that have their roads damaged by these large trucks should get that money without having to fight for it," he said.

Money from the oil and gas severance tax also should be set aside and distributed to counties that have had their waterways damaged, Carper said.

Kanawha County already receives severance tax funds collected by the state, he said.

The county received $390,307 in fiscal year 2010-2011, said David Fontalbert, chief fiscal officer.

Click here to read the original article in its entirety.

Marcellus Shale Question Will Be on Ballots

On Tuesday, October 4, 2011 0 comments

Barring any appeals, it appears that the question to amend the Peters Township Home Rule Charter will appear on the ballots in the Nov. 8 general election.

Members of the Peters Township Marcellus Shale Awareness and Action Group confirmed late Monday that Washington County Judge Paul Pozonsky ruled in their favor in a decision handed down earlier in the afternoon.

The judge’s decision came earlier than expected.

Pozonsky stated at a hearing last Wednesday that he would accept final briefs from legal counsel on Monday, and render a decision by the end of the week.

There was no immediate comment from Peters Township Solicitor William Johnson or township administration. Attempts to reach township officials at the end of the day were not successful.
The ruling clears the way for the question to appear on the ballot asking voters if the township’s Home Rule Charter should be amended to include a bill of rights and incorporate a ban on gas drilling within township boundaries.

Members of the Marcellus Shale Awareness group filed a petition in August with more than 2,400 names to have the question go before voters.

The township asked the court for an injunction against placing the question on the ballot, saying it would subject the township to lawsuits from individuals and gas companies. In his arguments, Johnson also argued, that if approved, the township would be a violation of the Pennsylvania Oil and Gas Act, as well as causing the township’s drilling ordinance to be nullified.

In his ruling, Pozonsky said the court lacks jurisdiction to rule on pre-election challenges “without an immediate harm caused by the presence of the measure on the ballot.”

PTMSA member Ann Shaner said the ruling was a proper one.

“We’re elated by the decision, because we said all along that the threshold issue was that it was the right of the people to vote,” she said. “You can’t speculate that this might happen or that might happen, or this person might sue. You can’t go on that because it’s all speculation.”

Shaner said she received a call after the lunch hour Monday afternoon that Judge Pozonsky had rendered his decision.

“This gives the people the right to vote. It’s democracy at work,” she said. “Whether we win or lose, it should go to a vote.”

Shaner said she and members of the PTMSA group disagree that the ballot question will nullify the gas drilling ordinance recently passed by council and that lawsuits will result.

“How can you have lawsuits if there are no permits issued?” she asked. “I don’t think anyone can bring a lawsuit for something that doesn’t even exist. People sign gas leases all over the country, but it doesn’t mean gas companies want to drill tomorrow.”

Shaner said she is not opposed to the existing ordinance, but said her group has information that some gas companies already planning challenges to the ordinance.

“Chesapeake Energy says there are about 16 items in the (township) ordinance that they would find objection to,” she said. “The only way the Oil and Gas Act is going to be changed is to chip away at it item by item. We’re going to change it by case law.”

It is not known if the township will appeal Pozonsky’s decision.

He said at the hearing he wanted to make his ruling in time to allow for any appeals that might take place.
According to Washington County Solicitor Mary Lynn Drewitz, the county elections office needed the decision before Oct. 12.

Drewitz, said that the “drop dead date” for a decision is Oct. 17.

Read the entire article here

Marcellus Shale on Capital Hill Agenda

On Tuesday, September 27, 2011 0 comments

According to an article published by Patriot News - "Many think it is likely that after three years of trying the state will finally set policy on how to tax and regulate the burgeoning shale gas industry.
Corbett is days away from announcing his own proposal for an impact fee that would closely tie any revenue raised to impacts from the drilling, be it mitigating damage to state roads or forests or improving municipalities’ ability to keep their public water supplies safe.

There are some shared goals: Democrats and many Republicans believe the time is ripe for the industry to give back.

But there are still big divides over exactly how much money to extract — bills range from Senate President Pro Tempore Joe Scarnati’s impact fee, which would generate $172 million annually by year six, to a House Democratic tax plan generating $483 million in its second year — and what to use it for.

Even some Republican House members, for example, have ambitious plans to use shale tax money for broad purposes, including the return of block grants to local school districts and dedicated funding streams for programs such as drug and alcohol treatment or emergency mortgage assistance.
Corbett is likely to be much more targeted in his approach, working hard to tie the money derived from per-wellhead impact fees to costs created by the industry.

At the end of the day, observers think chances are good a package can be hammered out, in part because there is some support in all four caucuses, and polls show that even in a strident no-new-tax climate, Pennsylvanians don’t mind taxing energy companies.
What needs to happen: Corbett and Republican allies must offer enough in terms of revenue and environmental protection to win over Democrats whose votes will be needed since some Republicans in the GOP-controlled Legislature remain steadfastly against any new taxes.

House Minority Leader Frank Dermody, D-Allegheny County, said his members are ready to negotiate. But he added this caution: “There’s only going to be one chance to do this, so I also think we have to make sure that we do it right so this industry develops in the most environmentally sound way possible.”

Fall prognosis: Call it likely. "

Read the entire article, here.

Is Marcellus Shale a Mineral?

On Friday, September 23, 2011 0 comments

A pending case in Pennsylvania considers whether Marcellus shale is a mineral.

The answer could determine whether contracts transferring mineral rights to Marcellus shale also transfer rights to Marcellus natural gas, the Pittsburgh Tribune-Review reports. "For anyone who's played the game 'Animal, Vegetable, Mineral,' it might seem obvious that the Marcellus shale isn't alive and doesn't grow—it's a rock layer in the ground, so it's a mineral," the story says. "In the Pennsylvania courts, the answer is not so clear."

Under the state’s so-called “Dunham rule,” Pennsylvania courts have held that a grant of mineral rights in a deed generally does not mean that the parties intended to grant or reserve oil or gas rights, according to a summary by the law firm K&L Gates.

In a ruling earlier this month, a Pennsylvania superior court asked a Susquehanna County court to decide whether the shale is a mineral and, if so, whether anyone who owns the shale also owns the shale gas, according to a summary by McGuireWoods.

The superior court ruled in an action to quiet title filed by John and Mary Josephine Butler. Their deed gives them the rights to half the minerals on their 244 acres of property, the Tribune-Review says. The case is now pending in Susquehanna County. “If the Marcellus shale is not a mineral,” the newspaper says, “it could change everything drillers have assumed about the state's oil and gas laws.”

Hat tip to Pat’s Papers and ABA Journal.

WV Proposal Means Natural Gas Operators Would Pay to Drill

On Thursday, September 15, 2011 0 comments

CHARLESTON, W.Va. (AP) — Natural gas operators would pay $10,000 to drill a well in West Virginia's share of the Marcellus shale field, and $5,000 for each additional well at the initial site, under a proposal adopted Wednesday by a special legislative committee.

The House-Senate panel also approved provisions increasing bonds posted for well projects, enhancing public notice of drilling and compensating the owners of surface land where operators drill their wells. With the committee resuming its work next month, Wednesday's changes move lawmakers closer to a regulatory bill that they hope to propose during a special session before year's end.

But the permit fee amendment has been considered a crucial hurdle in the process. Operators now pay just a few hundred dollars for a permit. The resulting revenues have helped to leave the Department of Environmental Protection's Oil and Gas office with a $1 million shortfall in its budget.

Tapping the rich Marcellus reserve can involve a horizontal drilling method that differs from the practices followed for vertical wells. Marcellus drillers also employ hydraulic fracturing, or fracking, and pump a high-volume, high-pressure mix of water, chemicals and sand into wells to release the shale's gas.
The mile-deep rock formation, stretching beneath several states in the region, is considered one of the world's largest natural gas fields. The resulting push to drill into the shale has spurred concerns about the large amounts of water needed, the potential effects of drilling and fracking on nearby drinking supplies, and what happens to the tainted frackwater afterward.

Lawmakers estimate the amended permit fees would provide DEP with $2.5 million annually, enough to cure that shortfall and allow the office to add as many as 15 additional staffers. The office would hire two field inspectors for every office worker it adds, DEP lawyer Kristen Boggs told the committee Wednesday.

"I think that this is a very good compromise," said Delegate Tim Manchin, D-Marion and the committee's House co-chair. "This is a very good step forward in terms of trying to meet the needs of the folks in the impact zone and get more feet on the ground and to restore some confidence in the people that the that the state is watching out for them."

Senate Co-Chair Doug Facemire said natural gas operators support the amendment.
"The industry made it clear to us that they wanted to try to protect the environment and the citizens," the Braxton County Democrat said, adding that "The industry did not try to fight or obstruct this. That's an important thing, also, to bring up."

The Legislature proved unable to pass a Marcellus measure during this year's regular session. Acting Gov. Earl Ray Tomblin has since ordered DEP to issue emergency regulations. Approved last month, these temporary provisions requires drillers to explain how they'll protect area land, manage the large volumes of water involved and respond to accidents, among other topics.
But environmental groups and the West Virginia Surface Owners Rights Organization argue that the emergency rule as falling short in such areas as air pollution and surface owner protections. The special committee expects to consider some of those subjects during October's interim study meetings.

Critics of the state's handling of this issue include West Virginia for a Moratorium on Marcellus. They plan to picket Thursday outside a well site at Morgantown Industrial Park. This Marcellus project spurred a Morgantown ordinance banning horizontal drilling-hydraulic fracturing operations within or near city limits.
A circuit judge has since blocked that ordinance.

Read the original article here.

Pittsburgh Residents Suing to Hault Anti-Drilling Referendum

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An affluent Pittsburgh suburb is suing to stop an anti-drilling referendum that a citizens group has gotten on the Nov. 8 ballot.

The Peters Township Marcellus Shale Awareness group collected 2,500 signatures to get the question on the ballot that would amend the township's home rule charter to ban gas drilling and hydraulic fracturing.
The township has already passed an ordinance that limits drilling to 40-acre parcels and requires soil and water testing, but the citizens group doesn't believe those measures are strong enough.

Township solicitor William Johnson believes the referendum is illegal under a state act that regulates drilling and could expose the township to litigation from drillers or those who want to lease their land for that purpose.

A Washington County judge has set a Sept. 28 hearing on the issue.

Read original article here

Marcellus Shale Could Mean Fifty-Thousand Jobs to New York

On Monday, September 12, 2011 0 comments

In announcing the study, DEC Commissioner Joe Martens said the agency will propose regulations for high-volume hydraulic fracturing, or "fracking," of gas wells in early October. Environmental advocates have urged the agency to enact regulations rather than mere permitting guidelines to give the rules the force of law.
The study proposes guidelines to protect the environment, human health and communities from potential harm related to gas production using fracking, which injects wells with millions of gallons of chemically-treated water and sand a mile underground to release trapped gas.

Read original article here

Flooding in NY and PA Raising New Fracking Concerns

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The floods in upstate New York are raising new concern about plans for natural gas drilling in New York.
The areas most affected by the disaster happen to sit on the Marcellus Shale, the rich natural gas field that the natural gas industry hopes to open for future drilling using horizontal hydraulic fracturing, the controversial extraction method that is currently under public review in New York.

The New York State Department of Environmental Conservation has set a timeline that calls for a public comment period on its environmental impact document and proposed regulations by Dec. 12, with final regulations and new drilling permits envisioned for some time next year.

But environmental groups and some elected officials are now calling for more time, saying floodplains maps should first be updated to take into account the recent extreme weather events and point out that such flooding makes hydrofracking an even bigger environmental risk.

“The floodplain is a different place than it was,” said New York State Assemblyman Kevin A. Cahill, a Democrat, who chairs the energy committee.

He said places that used to flood sporadically or not at all now experience three or four floods a year. “We need to remap,” he said.

In Pennsylvania, where drilling in the Marcellus is already taking place, environmental groups are asking that state’s environmental officials to disclose whether drilling pits have overflowed and spilled their toxic contents into flooded creeks, streams and rivers.

In New York, state environmental officials say that their draft requirements for hydrofracking already ban the placement of well pads and storage for drilling chemicals and waste water in flood plains.
But their own environmental impact document acknowledges that mapping of some of the areas affected by recent flooding won’t be ready until 2012.

“Broome County is one of the hotspots that gas companies are trying to target for drilling and much of the county is now underwater,” said Katherine Nadeau, of Environmental Advocates of New York. “That’s scary to think about.”

Mr. Cahill said he was also asking the environmental conservation department for an extension of the public comment period by an additional three months. He said communities affected by the floods need to recover to be able to participate in the public review of the proposed hydrofracking rules.

Read original article here

More Hydraulic Fracturing Wastewater is being Recycled

On Wednesday, September 7, 2011 0 comments

In early 2010, the West Virginia Department of Environmental Protection took two steps to get a better idea of water sourcing, volumes and disposal for hydraulic fracturing of Marcellus shale gas wells.

A year and a half later, results are beginning to accumulate.

Several million gallons of water are injected into a Marcellus shale well to release the gas within.

As this hydraulic fracturing, or fracking, began ramping up several years ago, public concern grew over where the water was coming from and how the flowback that returns to the surface was treated and disposed of.

In response, the WVDEP Office of Oil and Gas issued a permit addendum in January 2010 requiring operators planning to use more than about 200,000 gallons of water to detail in advance their expected volumes, sources and disposal methods.

The OOG’s primary interest, according to office Chief James Martin, was to find out how much water operators are withdrawing from where.

A global position system website that will use that information in real time is still in development, Martin said.
However, he was able to share some aggregate information on anticipated volumes and sources.

From April 2010 through August 2011 — about 17 months — gas well operators reported expecting to use about 2.1 billion gallons of surface water, 230 million gallons of purchased water and 26 million gallons of groundwater, according to the OOG database.

The report did not detail how many wells these permits represented.

Operators also reported expecting to re-use about 87 million gallons — less than 4 percent for the 17 months, a number Martin said is, in reality, far higher.

“There’s been more move toward trying to re-use and recycle as much as possible,” he said. “We weren’t expecting that in the beginning. It’s been more than I would have thought two years ago.”

Conclusions to be drawn from the numbers are limited because they are pre-use — plans could change during drilling — and also because operators are allowed two years after receiving a permit to drill or may never drill at all.

More interesting, though also incomplete, is post-use reporting that the WVDEP Division of Water and Waste Management, or DWWM, began requiring in March 2010.
“Keep in mind, once they do the fracking and they get the return water back, then at that point they have a year to report,” said DWWM Director Scott Mandirola.

“Up until the last three months or so, we didn’t have very much data at all and all of a sudden we’re starting to get reporting coming in,” Mandirola said.

So far for 2010, operators have reported withdrawing 344 million gallons in surface, purchased and groundwater to fracture wells at 38 sites, according to the DWWM database.

The number of wells at the 38 sites is not specified.

Of that water, 323 million gallons was reported injected into wells as hydraulic fracturing fluid. Chesapeake Appalachia has so far reported injecting the most in 2010, with 196 million gallons at 16 well sites. Second is Antero Resources, with 41 million gallons at five well sites.

About 31 million gallons of the injected fluid returned to the surface as flowback, or 9.5 percent of fluid injected, with companies reporting flowback rates ranging from 4.8 percent for EQT to more than 43 percent for Waco Oil and Gas Co.

In aggregate, for all wells reporting so far in 2010 and the few that are in for 2011, about three-quarters of flowback was destined for re-use — far more than gas operators anticipated in their pre-use permit addenda, as Martin suspected.

Nearly all the rest was disposed of by underground injection, with a few hundred thousand gallons going to publicly owned treatment works in Pennsylvania.

Water use will be reported more formally through new water management plans required by the emergency rule that WVDEP issued in August for Marcellus operations, Mandirola said.

And he added to Martin’s mention of a real-time GPS tracker for water withdrawals.

Operators will contact WVDEP 24 to 48 hours before beginning to withdraw, he said, and the agency will plot their withdrawal points and estimated volumes online. Operators will then notify the agency when they’re done.
“That way we will have a dynamic map of sites coming online and going offline so at any time we know how many folks are out there drawing water,” he said.

Read the original article here.

Post-Gazette Seeks Settlement Details

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The Pittsburgh Post-Gazette has asked a Washington County Common Pleas judge to unseal a recent legal settlement between a Mount Pleasant Township family and various corporations involved in Marcellus Shale gas drilling operations near its home.

Judge Paul Pozonsky scheduled arguments for 11 a.m. Oct. 4 on whether the settlement he sealed Aug. 23 should be open to public review.

In settling the case, plaintiffs Stephanie and Chris Hallowich and defendants -- including Range Resources, the Mark West Energy Partners and Williams Gas/Laurel Mountain Midstream Partners -- agreed to not disclose settlement details.

But Post-Gazette attorney Frederick N. Frank said Post-Gazette reporters had been present for the settlement hearing, so compelling reasons should have been stated to justify sealing the results from public view.

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Township Officials Denounce Drilling Tax

On Thursday, September 1, 2011 0 comments

In a meeting with several state legislators Wednesday morning, a group of township supervisors from Westmoreland County voiced their objections to a Marcellus shale drilling tax that would benefit counties statewide, regardless of whether they play host to drilling companies.
The state legislators met with the supervisors yesterday at the Unity Township municipal building for an open forum, but much of the discussion was geared toward fair compensation for municipalities that allow companies to drill for the natural gas.

State Sen. Kim Ward, (R-Hempfield), Rep. Joseph Petrarca, (D-Washington Township) and Rep. Mike Reese, (R-Mt. Pleasant Township), among others, fielded questions from the group about severance tax and impact fees, both of which are being considered by the state.

An impact fee is a funding mechanism that would help municipalities pay for the wear and tear on their roads and any other repairs needed because of the impact from drilling activity.

A severance tax, the legislators explained, is a tax levied on the gas taken out of the ground and paid out statewide.

Both the supervisors and legislators voiced their opinions against the latter.

"This is all about a wealth transfer from the western part of the state where the drilling takes place to the southeastern part of the state," said Rep. Tim Krieger, (R-Delmont).

"We should get more money where roads are being affected and water is being threatened," Petrarca added.

Ward advised supervisors to voice their opinions for the impact fee as opposed to the severance tax before it's too late.

"Twenty-six senators don't have any Marcellus shale drilling," Ward said. "That means they could pass (a severance tax) today. If it gets to Harrisburg, things get taken. If it's anywhere where a legislator can get a hold of it, it's gone."

Unity Township Supervisor Mike O'Barto said he isn't concerned with getting extra money from the taxes, just enough to offset the damage done to roads and other public infrastructure.
"We're not looking for any sort of handout, we're just looking to get what we deserve," O'Barto said.
O'Barto also led a lengthy discussion about some municipalities being forced to do work on state roads that should be taken care of by PennDOT.

"Here we are taking care of signage on state roads, traffic lights, cutting grass, all of which we aren't getting paid for. I think we're all frustrated," O'Barto said.

Read more: Township officials denounce drilling tax - Pittsburgh Tribune-Review

Residents Condemn Effects of Drilling

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More than 100 residents turned out Wednesday night to express their concerns about Marcellus Shale drilling in Southwestern Pennsylvania and to urge community leaders to continue the fight in Harrisburg.

Their voices were heard by members of the Citizens Marcellus Shale Commission, a blue-ribbon panel gauging the opinions of residents in preparation of a report to be submitted next month to legislators.

Commission co-chairman Dan Surra, a former Democratic representative from Elk County, said the group -- including numerous environmental and homeowner representatives -- was assembled in response to the governor's Marcellus Shale Advisory Commission, which was "loaded with industry representatives."

"This commission will give citizens an opportunity to add their voice and bring some necessary balance to this critical debate," he said.

The meeting at the South Fayette Middle School auditorium was the first of five scheduled across the state. It opened with presentations from experts on water and air pollution, followed by remarks from more than two dozen residents from Allegheny, Washington, Westmoreland, Beaver and Greene counties.

If there was anyone in the audience who supported gas drilling, he or she didn't speak up.
Pam Judy of Carmichaels told the commissioners how members of her family have been affected by a drilling operation on property adjacent to their home.

"They sound as if it's a jet engine. It rattles the windows in our house," she said. "We've experienced sore throats, headaches, runny noses, muscle aches and fatigue. Our children have experienced nosebleeds. I've had dizziness, vomiting and vertigo."

"It's shocking. It's a failure of the agencies responsible for protecting public health," said Ned Mulchay, executive director of Three Rivers Waterkeeper. "It's not radiation, it's not nuclear waste, we're not going to end up with three heads, but it's something that the state has the power to regulate, and they're simply not doing it."

Mike Atherton of Greensburg decried the decreased value of homes and property near drilling sites.
"Risk alone lowers property values. An accident destroys what is left," he said. "Who would buy a home with unreliable water? Most homeowners get no profit from shale gas, yet we all bear the risks."
Deron Gabriel, a South Fayette commissioner, told how officials learned of drilling companies leasing property near the school and, after researching the matter and conducting public hearings, enacted a zoning ordinance banning drilling in residential areas or conservation districts.

Two weeks ago, they learned that the restrictions are the subject of a lawsuit filed by Range Resources, a Texas-based drilling company.

"We're in a position, as a township, of defending our ordinance," Mr. Gabriel said. "Our residents made it very clear to us. We're hoping for some help from the state because we believe local people should be able to decide."

The other four commission meetings this month will be held in Philadelphia; Williamsport, Lycoming County; Wysox, Bradford County; and Harrisburg.

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SEC Steps Into Fracking Debate

On Thursday, August 25, 2011 0 comments

WASHINGTON—The Securities and Exchange Commission is asking oil and gas companies to provide it with detailed information—including chemicals used and efforts to minimize environmental impact—about their use of a controversial drilling process used to crack open natural gas trapped in rocks.

The federal government's investor-and-markets watchdog is stepping into the heated environmental debate surrounding hydraulic fracturing, or "fracking," according to government and industry officials, even as state and federal environmental officials have begun to bring greater pressure on the industry. The process, which involves pumping water, chemicals and sand underground to free difficult-to-reach natural gas in shale basins, has come under criticism from environmental groups ad some lawmakers over concerns toxins in the mix may contaminate air and water.

The SEC move shows the broad interest among Washington regulators in taking a closer look at fracking and suggests companies that are betting billions of dollars on the technology will increasingly need to weigh disclosing techniques they often consider proprietary. Battles over disclosure have already broken out at the state level, including in states such as New York and Pennsylvania that sit on the giant Marcellus Shale, an underground formation that has become a fracking hotbed because of the large quantities of natural gas there. Just last week, Noble Energy Inc. paid $3.4 billion for a stake in developing 663,350 acres there.

Regulators in several states have identified cases in which drilling—although not necessarily the fracturing process in particular—has allowed natural gas to seep into residential water wells, and at least one scientific study has linked drilling and gas contamination more broadly. But there have been few if any documented cases of contamination by the chemicals used in hydraulic fracturing. The industry acknowledges that improperly constructed wells can allow gas to escape, but says such cases are rare and aren't directly tied to fracturing itself.

In the past, the SEC has trained its attention on other areas of concern, such as subprime mortgages and credit-default swaps, and has asked companies to provide additional information to investors. Government officials said the SEC's interest in fracking is in ensuring investors are being told about risks a company may face related to its operations, such as lawsuits, compliance costs or other uncertainties. Other federal agencies like the Environmental Protection Agency are collecting information about fracking, but those efforts are separate from the SEC.

For the moment, the SEC isn't requiring broad, standardized disclosure of fracking information to the public. Instead, oil and gas companies are being asked by the agency's office that oversees corporate disclosure to supply information confidentially to the SEC, and the agency, in turn, will likely require them to publicly disclose some of that information, according to government officials.

"If there's something in [a company's] field of operation that creates uncertainty, that's something they may want to talk about" with investors, said a government official.

The SEC's requests drew criticism from some in the industry about potential regulatory overkill.

"While our industry absolutely supports common sense disclosure and transparency measures, such duplicative inquires that may fall outside of an agency's core mission, are troubling and counter to what our nation needs at this time," said Kathryn Klaber, president of Marcellus Shale Coalition, an industry group.

An SEC spokesman said "in the course of our filing reviews staff will ask questions related to the areas disclosed in the company's filings." The EPA didn't respond to requests for comment.

The SEC's foray into the issue comes as the Obama administration is trying to find a middle ground between environmental concerns over fracking and an industry that is creating jobs and increasing domestic supplies of an alternative energy source to coal. Natural gas currently provides about 25% of total U.S. energy and is projected to increase to 45% by 2035, according to the U.S. Energy Information Administration. In addition to a fracking study being conducted by the EPA, the Department of Energy and the Interior Department have also been examining the practice. Some states have fined drilling companies for environmental problems.

For securities regulators, two recent energy-related disasters are fresh in their minds: the crippling of Tokyo Electric Power Co.'s Fukushima Daiichi nuclear-power plant in March and last year's BP PLC oil spill in the Gulf of Mexico. In both cases, some investors were surprised at the risk to which the companies were exposed, and their share prices fell sharply.

The SEC's questions in recent letters include which chemicals are being injected into the ground, what companies are doing to minimize water usage and what steps they are taking to minimize environmental impact, according to copies reviewed by The Wall Street Journal.

The questions are already prompting some companies to disclose more. SandRidge Energy, a small, Oklahoma company, beefed up disclosure related to fracking operations after the SEC asked a series of questions in connection with a public offering of a trust SandRidge completed last week. For instance, the company said in a recent financial filing that its fracking fluid contains 99% fresh water, and the remainder includes the food additive guar, enzymes and other chemicals, which it didn't name.

Fracking fluids include some toxic chemicals, based on company disclosures of chemicals such as benzene and formaldehyde for congressional reports and at voluntary disclosure sites.

Kevin White, senior vice president of SandRidge, said "responding to those comments would be easier than what other companies might face" because the firm doesn't use many chemicals in its fracking fluid.

Industry representatives said much depends on how specific the SEC wants companies to be and cautioned they would resist revealing proprietary information.

"While we support disclosing our ingredients, it is critical to our business that we protect our proprietary information, including the recipes of our products," said spokeswoman Tara Mullee Agard of Halliburton Co., one of the largest providers of hydraulic-fracturing services to the energy industry.

Already some companies have said they will voluntarily publicize their chemicals online at, and several states, including Wyoming, Texas and Arkansas, have recently passed mandatory disclosure rules. The companies will make the information public through state registries.

Fracking is primarily regulated by states and is largely exempt from some federal statutes, such as the Safe Water Drinking Act. The EPA's study on whether fracking affects drinking water is to be released at the end of 2012. For the study, nine companies provided information on the chemicals they use after an agency request last year.

The SEC has also been investigating whether companies are overstating the long-term productivity of their natural-gas wells and has issued subpoenas to at least two firms, according to company financial disclosures earlier this month. The agency subpoenaed Quicksilver Resources Inc. and ExCo Resources Inc. The New York attorney general's office, meanwhile, has also issued subpoenas this month to various companies, including Range Resources Corp., Goodrich Petroleum Corp. and Cabot Oil & Gas Corp., over their estimates.

Jim Smith, a partner at Houston law firm Porter Hedges LLP specializing in environmental law, questioned whether the type of fracking information the SEC is requesting is material to a company. "I have not heard of companies in relatively recent times having significant environmental liabilities associated with hydraulic fracturing that in any way affected their reported worth," he said.

Investors, including the $129.4 billion New York State Common Retirement Fund, have begun agitating for enhanced disclosure of fracking operations over the past few years and have successfully included shareholder proposals at 16 companies. Though none have passed, proponents at Chevron Corp. got 41% support, backers at Exxon Mobil Corp. got 28% and Williams Cos. holders got 42%. Some companies, such as Williams and Cabot, have increased disclosure of their fracking operations as a result of the proposals.

New York State Comptroller Thomas P. DiNapoli , who runs the New York State Common Retirement Fund, said some companies drilling in the Marcellus Shale in Pennsylvania have had to pay large fines and suffered reputational damage over fracking problems. Chesapeake Energy and Cabot have paid fines there. "Only through appropriate disclosure do you get the information you need to make informed and sound investment decisions," he said.

—Daniel Gilbert and Russell Gold contributed to this article.

US Slashes Marcellus Shale Estimate by 80 Percent!

On Wednesday, August 24, 2011 0 comments

The U.S. will slash Marcellus Shale reserves from 84 trillion cubic feet of natural gas from the earlier estimates of 410 trillion, according to Bloomberg.

Geologists from the U.S. Geological Survey provided the new number, which supersedes estimates from the Energy Information Administration.

The EIA does not contest the new number: "They’re geologists, we’re not. We’re going to be taking this number and using it in our model,” an EIA analyst told Bloomberg.

The Marcellus Formation, which spans from New York to Kentucky, was America's greatest hope for natural gas.

An April estimate from the EIA increased Marcellus reserves by a multiple of 42 based on new technology and information. As part of this estimate, the EIA said America had enough recoverable natural gas to heat homes and run power stations for 110 years

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New Marcellus Shale Study Says Marcellus Shale is Better Than Coal

On Thursday, August 18, 2011 0 comments

Marcellus gas has less impact on global warming than coal, according to a recent study by scientists at Carnegie Mellon University.
The peer-reviewed study published Aug. 5 in “Environmental Research Letters” appears to be a direct refutation of an April study from researchers Robert Howarth and Anthony Ingraffea at Cornell University that indicated that shale gas was worse for global warming than coal.

The Cornell study had a number of faults — acknowledged by its authors — including sketchy data that did not directly apply to Marcellus drilling operations.

The Carnegie Mellon study looks specifically at Marcellus and the “life cycle greenhouse gas emmissions” associated with its production and consumption.

Marcellus gas is essentially no different than conventional natural gas, the study found, and 20-50 percent cleaner than coal for producing electricity.

“Marcellus shale gas emits 50 percent fewer greenhouse gas emissions than any U.S. coal-fired plant,” said study co-author Chris Hendrickson. “We favor extraction of Marcellus shale natural gas as long as the extraction is managed to minimize adverse economic, environmental and social impacts.”
Former DEP Secretary John Hanger lauded the new study on his blog, saying it “debunks and decimates professor Howarth’s hit piece study that the NYT gas reporter and other media gave so much attention.”

“By contrast,” Hanger said, “the CMU study has received very little press attention so the result remains that many people think Howarth is the final word on this important matter.”
The new study does support “green completions” — in which gas is captured during the earliest stages of production rather than being vented or flared into the atmosphere. Proposed shale gas rules from the EPA would require green completions.

“Green completion... would significantly reduce the largest source of emissions specific to Marcellus gas preproduction,” the study says, but it adds that such emissions are a small portion of the life cycle estimates.

The study’s authors said greenhouse gas emissions are not the only challenge when it comes to extracting shale gas.

“We still need to study other environmental issues, including use of water and disruption of natural habitats,” said co-author Paulina Jaramillo.
Read Original Article - Here.

Proposed Drilling Under PA State Forests Could Bring In $60 Billion in Revenue

On Wednesday, August 17, 2011 0 comments

The head of Pennsylvania's Department of Community and Economic Development has said if Pennsylvania allows new Marcellus Shale gas well drilling throughout Pennsylvania's publicly owned forests, state government could receive revenues of $60 billion in the next 30 years and solve all of its economic problems.

Alan Walker, secretary of the DCED, made the remarks last week during an interview for Capitolcast. The remarks were reported by Capitolwire yesterday.

According to the article, Mr. Walker acknowledged that getting $60 billion in revenue would require leasing drilling rights under most of the state's forests, but he said he wasn't concerned about any environmental impacts.

Mr. Walker is quoted in the article as saying, "The way the drilling platforms are being set up today -- where you may only have to have one pad every so many square miles -- it's a minimum impact on the state forest property, and in a matter of a couple of years, it's going to be revegetated."

Environmental organizations and some Democratic state legislators condemned the idea. Paul King, president of the Pennsylvania Environmental Council, a mainstream statewide environmental organization, said in a letter to Gov. Tom Corbett that the proliferation of shale drilling rigs, pipelines and compressor stations "would be devastating to our state forests" and the impacts would last for generations.

"To use our state forests as an expedient means to generate new revenues, when there are a multitude of options including but not limited to a severance tax, is wholly inappropriate," Mr. King wrote, noting that the forests are already big economic assets for their timber production, tourism and recreation. "These lands belong to the people of Pennsylvania."

In response to reporters' questions, Kevin Harley, the governor's spokesman, issued a statement Tuesday afternoon saying Mr. Walker's remarks reflected his position and opinion.

"[Secretary Walker] was speaking as someone who is in charge of economic development," Mr. Harley said. "He wasn't speaking on behalf of the governor." He added that Mr. Corbett would take into consideration both economic and environmental factors before moving forward on any future lease sale, but no additional leasing of forest land is in the works.

Read entire article in Pittsburgh Post Gazette.

PA Shale Gas Production is UP

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HARRISBURG, Pa., Aug. 17 (UPI) -- Natural gas production from the Marcellus shale gas play in Pennsylvania increased substantially during the first six months of 2011, the government said.The Pennsylvania Department of Environmental Protection reported a 22 percent increase in shale gas production during the first half of 2011 compared with the second half of 2010, the Platts news service reports.

Shale gas production was reported at 1.87 billion cubic feet per day.

The U.S. Environmental Protection Agency in May called on energy companies to do more to monitor drinking water downstream from treatment plants taking wastewater from the Marcellus shale gas play.

Environmental advocates have expressed concern that chemicals used to coax natural gas out of shale formations could reach drinking water aquifers.

The New York State Department of Environmental Conservation in early July released recommendations surrounding shale gas operations in the state. Those recommendations could open about 85 percent of the Marcellus Shale play in New York to development but keep operators away from key watersheds and groundwater aquifers.

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Pittsburgh Mayor Won't Sign Bill Banning Marcellus Shale In City

On Tuesday, August 9, 2011 0 comments

Mayor Luke Ravenstahl has decided not to sign Pittsburgh City Council's bill banning Marcellus Shale gas drilling in the city.

Tuesday marks the deadline for getting the measure to the elections department to include it on the fall ballot.Ravenstahl's decision to withhold his name eliminates the possibility of any ballot referendum. Ravenstahl said in a statement that the "industry is in the region to stay."

National Fuel Joint Venture to Develop Marcellus Shale Is A No Go.

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Dow Jones Newswire -
National Fuel Gas Co. (NFG) said it likely won't pursue a joint venture with two companies that its subsidiary had been eyeing to develop assets in the Marcellus shale region.

The company's stock had rallied last September after its Seneca Resources Corp. subsidiary said it was seeking a partner for its assets in the prolific natural-gas production area in Pennsylvania.

Friday, shares were off 9.9% to $57.01 after setting off a single-stock circuit breaker. The stock had also declined after-hours Thursday, despite the company's better-than-expected fiscal third-quarter results.
As late as last month, Seneca said it was still considering offers from "several" different parties. Friday, it parent company said discussions came "relatively close" with two potential partners but didn't meet the bar of enhancing shareholder value.

"Our future growth prospects--and the fact that we're not capital constrained or up against a schedule of lease expirations--sets a pretty high bar," Chief Executive David F. Smith said in a statement. He added that, while the two offers the company considered were good and serious, "they just weren't good enough."

Seneca's exploration-and-production business already operates a joint venture for some of its Marcellus shale wells with EOG Resources Inc. (EOG)

Late Thursday, National Fuel reported its profit for the period ended June 30 rose 10% to $46.9 million, or 56 cents a share, from $42.6 million, or 51 cents a share, a year earlier. Operating revenue climbed 8.2% to $381 million. Analysts polled by Thomson Reuters had expected earnings of 53 cents a share and revenue of $375 million.

National Fuel also increased its earnings guidance for the year to a range of $3 to $3.10 a share from $2.83 to $2.98.

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Pittsburgh City Council Wants Marcellus Shale Drilling Ban on Ballot

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According to a report by the Pittsburgh Tribune-Review,"Pittsburgh City Council launched a murky legal maneuver today in an attempt to get a Marcellus shale drilling ban onto November ballots.

Council earlier this month passed legislation that would make the ban part of Pittsburgh's Home Rule Charter and was awaiting Mayor Luke Ravenstahl's approval to get a required voter referendum on the ballot. The deadline for submitting referendum paperwork to the Allegheny County Elections Department is today.

But Ravenstahl informed council by letter Monday evening that he would neither sign nor veto the bill, choosing instead to sit on it until the deadline passes.

Councilman Doug Shields said this morning that council would attempt to get the elections department to accept its "interim approval" of the referendum, but admitted he was unsure if the maneuver would succeed.
"I've never been in a situation like this before," Shields said. "What we're going to do is go see elections Director Mark Wolosik and see if we can get it on the ballot. The legal question is, is this valid?"

Controversy Surrounds One Citizen's ANTI-Drilling Billboard

On Thursday, August 4, 2011 0 comments

BRIDGEWATER TWP. - According to an article published on Citizens Voice, A public gathering near a billboard that depicts a pitcher of contaminated water became contentious Wednesday as pro- and anti-Marcellus Shale gas groups clashed.

Craig and Julie Sautner, of Carter Road in Dimock Township, have received threats since the sign was erected earlier this week, Sautner said. The pitcher of water depicted on the sign was drawn from the Sautners's well.

Small groups gathered near the sign Wednesday afternoon, at times turning contentious, with a member of the anti-gas group calling someone in the pro-gas group "greedy."

Sautner said his family has been living with a contaminated well for nearly three years.
"I think that's long enough to wait for clean water," Sautner said. "I've been living this life for three years. It's time to get it fixed."

The state Department of Environmental Protection has held Cabot Oil & Gas Corp. responsible for contaminating water wells in the area.

Sautner told those present the sign put the water issue "back on the front burner where it belongs."
Cabot spokesman George Stark disagreed.

"This billboard represents a falsehood," Stark said at the gathering. "Test results and science show that the water is clean and meets Safe Drinking Water standards.

"We continue to ask for others to prove the water is contaminated when we are able to prove otherwise," he added.

The company has tested the water of all of the plaintiffs embroiled in a lawsuit against Cabot, Stark said.

Sautner also spoke of a waterline former DEP Secretary John Hanger promised in late 2010 would be run from Montrose to the affected homes.

Cabot opposed the waterline proposal, as did Montrose Borough.

Bruce Ferguson of the Catskill Citizens for Safe Energy said the state backed away from the waterline when Cabot voiced opposition to the project.

"The gas companies are more powerful than the state government," Ferguson said.
"The waterline was yanked out from underneath us," Sautner said. "We deserve that waterline. It's time to step up."

DEP and Cabot reached a settlement and the state withdrew the waterline proposal in late 2010. In the settlement, Cabot agreed to pay affected homeowners double the fair market value of their homes and install methane separators.

Sautner said none of the affected homeowners in the lawsuit have taken the offer.
Others at the event expressed support for the Sautners and other affected Carter Road residents.
Craig Stevens, of Silver Lake Township, said the decisions made by some people based on money were negatively impacting others.

"Fix the water or go back home," Stevens said.

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Lieutenant Governor Meets With Marcellus Shale Task Force

On Friday, July 29, 2011 0 comments

According to a July 29th article published by The Republican Herald - Pennsylvania's lieutenant governor challenged Schuylkill County's newly formed Marcellus Shale task force to make recommendations to the county commissioners based on fact and not emotion regarding the county's role in the future of the deep drilling industry.

"I would challenge you to get to the truth, get to the science, and paint the picture in a truthful way," Lt. Gov. Jim Cawley said Thursday. Cawley, a guest at an informal question-and-answer session held at the Schuylkill Chamber of Commerce building in Pottsville, commended the county for creating a Marcellus Shale task force to analyze effects of drilling by the natural gas industry - the 16th county to do so.

Also attending were chamber President Bill Wydra, county commissioners Mantura M. Gallagher and Frank J. Staudenmeier, county engineer Lisa Mahal, county grant writer Gary Bender, state Sen. Dave Argall, R-29; state Rep. Jerry Knowles, R-124; Mike Hanley, a representative of U.S. Rep. Tim Holden, D-17; Ed Kleha, representing state Rep. Neal P. Goodman, D-123; and Scott Thomas, a representative of state Rep. Mike Tobash, R-125.

Cawley, a former Bucks County commissioner, heads Gov. Tom Corbett's Marcellus Shale Advisory Commission, which was charged with developing policy recommendations on economic development and regulation of natural gas drilling.

Corbett formed the 30-member commission in March, giving them 120 days to develop recommendations on all aspects of natural gas drilling. The commission held 21 public meetings, heard 60 expert presentations and reviewed more than 650 emails and letters from the public.
"Rome wasn't built in a day and you can't study all of Marcellus Shale in 120," Cawley said Thursday. "We did discover a lot."

The state advisory commission released their final report July 22 containing 96 policy recommendations that include tougher regulations for drilling, doubling fines for violations, creating jobs in related industries and promoting the use of natural gas vehicles.

Cawley said the Corbett administration is ruling out a severance tax on the Marcellus Shale drilling industry, but not ruling out an impact fee. If a severance tax were implemented, Cawley said executives of the natural gas industry potentially could choose to do business elsewhere."

We have to be sensitive to the fact that we can price ourselves right out of the market," Cawley said.
Knowles said he has been witness to many discussions on Marcellus Shale which, he said, were based on misinformation.

"Putting a tax on it won't solve all of our financial problems," Knowles said. "I had the opportunity to visit a drilling site and I am firmly convinced it can be done safely."
Kleha said a number of Goodman's constituents are concerned that drilling would leave the county landscape worse than it all ready is.

"This area was raped and pillaged by the Industrial Revolution. Can you guarantee that what is left of this land will be returned to its natural order?" Kleha asked.

"I believe we have learned from the sins of our fathers, both in the timber and coal industries, and we will prohibit the irresponsibilities of the past," Cawley said. "We are going to make provisions for things like that. We will take the appropriate steps to continue to be good stewards of the environment."

Huge amounts of natural gas lie in the Marcellus Shale formation and are being developed in Northeastern Pennsylvania. No wells are yet planned for the county, although Susan A. Smith, director of county planning and geographic information systems, told the task force at its first meeting held June 15 that almost all of the county is in the Marcellus Shale area and one local landfill is accepting items from such activities.

"There is a Marcellus Shale in Schuylkill County but it is at a greater depth than what is being drilled now," Mahal said Thursday.

Rausch Creek Land LP of Valley View filed paperwork with the county's engineering office late last year, informing Schuylkill County of plans to withdraw up to 100,000 gallons of water daily from an abandoned stripping mine pit in Porter Township. The company said the purpose for the withdrawal is to provide water for future Marcellus Shale wells. It is unclear whether those wells would be in Schuylkill County. The water withdrawal plan must first be approved by the Susquehanna River Basin Commission.

The Schuylkill County commissioners established the 15-member county task force in May to identify key issues, conduct research, generate public awareness and review and recommend public policy regarding Marcellus Shale activities.

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