Posts Tagged ‘state’

“Officials from 15 states have recently testified that groundwater contamination from the hydraulic fracturing procedure is not known to have occurred despite the procedure’s widespread use in many wells over several decades.” (New York State SGEIS)

See the Energy in Depth compilation of testimonies here.

Pennsylvania’s gain vs. New York’s missed opportunity.

The following article is from the July 21 Wall Street Journal

Politicians wringing their hands over how to create more jobs might study the shale boom along the New York and Pennsylvania border. It’s a case study in one state embracing economic opportunity, while the other has let environmental politics trump development.

The Marcellus shale formation—65 million acres running through Ohio, West Virginia, western Pennsylvania and southern New York—offers one of the biggest natural gas opportunities. Former Pennsylvania Governor Ed Rendell, a Democrat, recognized that potential and set up a regulatory framework to encourage and monitor natural gas drilling, a strategy continued by Republican Tom Corbett.

More than 2,000 wells have been drilled in the Keystone State since 2008, and gas production surged to 81 billion cubic feet in 2009 from five billion in 2007. A new Manhattan Institute report by University of Wyoming professor Timothy Considine estimates that a typical Marcellus well generates some $2.8 million in direct economic benefits from natural gas company purchases; $1.2 million in indirect benefits from companies engaged along the supply chain; another $1.5 million from workers spending their wages, or landowners spending their royalty payments; plus $2 million in federal, state and local taxes. Oh, and 62 jobs.

Statistics from Pennsylvania bear this out. The state Department of Labor and Industry reports that Marcellus drilling has created 72,000 jobs between the fourth quarter of 2009 and the first quarter of 2011. The average wage for jobs in core Marcellus shale industries is about $73,000, or some $27,000 more than the average for all industries.

The Pennsylvania Department of Revenue says drillers have paid more than $1 billion in state taxes since 2006—and the numbers are swelling. In 2011′s first quarter, 857 oil and gas companies and affiliates paid $238 million in capital stock and foreign franchise taxes, corporate income taxes, sales taxes and employer withholding. This exceeds by some $20 million the total payments in 2010.

The revenue department also identified some $214 million in personal income taxes paid since 2006 that can be attributed to Marcellus shale lease payments to individuals, royalty income and asset sales. And all of this with no evidence of significant environmental harm.

***

Then there’s New York. The state holds as much as 20% of the estimated Marcellus shale reserves, but green activists have raised fears about the drilling technique known as hydraulic fracturing and convinced politicians to enact what is effectively a moratorium.

The Manhattan Institute study shows that a quick end to the moratorium would generate more than $11.4 billion in economic output from 2011 to 2020, 15,000 to 18,000 new jobs, and $1.4 billion in new state and local tax revenue. These are conservative estimates based on a limited area of drilling. If drilling were allowed in the New York City watershed—which Governor Andrew Cuomo is so far rejecting—as well as in the state’s Utica shale formation, the economic gains would be five times larger.

Consider New York’s Broome County, which borders Pennsylvania and from which you can spot nearby rigs. The county seat of Binghamton ought to be a hub for shale commerce, but instead its population is falling as its young people leave for jobs elsewhere.

A study commissioned by the county in 2009 found that Broome could support up to 4,000 wells, but drilling even half that number would create some $400 million in wages, salaries and benefits; $605 million in property income from rents, royalties and dividends, and some $43 million in state and local tax revenue.

The Broome analysis pointed to Texas, where Chesapeake Energy paid Dallas Fort Worth International Airport $180 million for drilling rights on 18,000 acres of airport property—$10,000 per acre. The airport receives a 25% royalty on the natural gas produced by airport wells—more than $28 million in fiscal 2008. The study also noted the boon that rising oil and gas property values have been to Texas landowners, tax authorities and school districts.

***

Governor Cuomo has said he wants to lift New York’s moratorium, and the state’s recently released draft rules are a step forward. But they must still undergo legal review and a public comment period that could bar New York drilling for the rest of this year, if not longer. New York will also still ban drilling in about 15% of the state’s portion of the Marcellus and impose more onerous rules than other states on private property drilling. Such bows toward the obsessions of rich, big-city greens explain why parts of upstate New York are the new Appalachia.

As they look across their northern border, Pennsylvanians can be forgiven for thinking of New Yorkers the way Abba Eban once described the Palestinians: They never miss an opportunity to miss an opportunity.

Canonsburg, PA – Member companies of the Marcellus Shale Coalition (MSC) invested more than $411 million over the past three years to repave, rebuild and improve roadways and transportation infrastructure across the state of Pennsylvania, according to a survey of participating members. Since 2008, approximately 21% of the payments have been made toward local roads, while approximately 79% went toward improving roads maintained by the state.

Kathryn Z. Klaber, president and executive director of the MSC, issued the following statement on the industry’s commitment to improving the roads and infrastructure that support Marcellus activity:

“Preparing and restoring roads associated with Marcellus development is a responsibility that our coalition members take very seriously. We understand and recognize the concerns regarding the increase in truck traffic and its impact on our roads. And we also understand, as good neighbors, that we must do everything to ensure that we leave these roads in better condition than when our operations started. This $411 million industry investment in our roads since 2008 is just one example of the natural gas industry addressing local concerns in a direct and straightforward manner. It’s an investment that will continue to grow as responsible shale gas development continues across the Commonwealth.”

Natural gas operators are required by law to bond each mile of posted road traveled, submit road management plans (Excess Maintenance Agreements) to the Pennsylvania Department of Transportation, and acquire hauling permits prior to truck traffic traveling on a given road. Road management plans outline which roads an operator may travel while also stipulating a maintenance plan for each roadway.

NOTE: Today, the MSC is hosting the second annual Marcellus Transportation Safety Day. This seminar is designed to better educate carriers and truck drivers supporting the natural gas industry on Pennsylvania’s regulations to continuously improve their safe operating practices. Speakers include representatives from the Pennsylvania State Police, Pennsylvania Department of Transportation, Federal Motor Carrier Safety Administration, Pennsylvania Department of Environmental Protection and the Pennsylvania Public Utility Commission. For additional information, visit www.marcelluscoalition.org.

Posted At: Marcellus Shale Coalition.org

PSU Cooperative Extension: “In counties with ten or more Marcellus wells…tax income increased 325.3 percent”

Canonsburg, Pa. – The Marcellus Education Team at Penn State University’s Cooperative Extension recently issued a comprehensive analysis highlighting the positive and growing tax revenues being generated throughout the Commonwealth tied directly to the responsible development of clean-burning, homegrown natural gas. Kathryn Klaber, president and executive director of the Marcellus Shale Coalition (MSC), issued this statement regarding Penn State’s findings:

“The responsible development of clean-burning natural gas is creating tens of thousands of good-paying jobs, providing stable, American energy supplies for consumers and generating hundreds of millions of dollars in tax revenues at the same time. This data brings into perspective the enormous amount of taxes our industry’s work is generating for Pennsylvania’s economy, especially in rural communities. Without question, each and every Pennsylvanian is benefitting from Marcellus Shale development.

“Unfortunately the ongoing tax debate has been framed too narrowly. This study, however, importantly broadens the understanding of the tax revenues our industry is helping to produce for state and local governments.”

Key excepts from Penn State University’s new study: “State Tax Implications of Marcellus Shale: What the Pennsylvania Data Say in 2010”

• State Sales Tax Revenues Soar in Marcellus Producing Counties: “The data indicate that counties with 150 or more Marcellus wells experienced an 11.36 percent increase in state sales tax collections between 2007 and 2010. Counties with fewer Marcellus wells reported declining state sales tax collections, but they still did better than counties with no Marcellus wells, which reported steeper declines. These data suggest that counties with Marcellus shale development fared better in retail sales during the years 2007–2010 than those counties without.
• Realty Transfer Tax Collections in Marcellus Producing Counties Stronger than Non-Marcellus Counties: “Across the state, realty transfer tax collections were down between July 2007 and June 2010, reflecting overall weaknesses in the real estate market. However, counties with Marcellus shale development typically declined less than those without such development.”
• “Counties With Marcellus Activity Showed Greater Increases in Tax Income”: “The state personal income tax is a levy on personal income, including wages and salaries, investment income, and leasing and royalty income. Counties with Marcellus activity showed greater increases in tax income than non-Marcellus counties even though there was little difference in the number of returns filed. Counties with ten or more wells reported an average 6.96 percent increase in taxable income, and counties with between one and nine wells reported a 3.08 percent increase. Those areas with no wells witnessed a 0.89 percent increase in taxable income.”
  • “In counties with ten or more Marcellus wells, returns reporting royalty income increased 44.1 percent and tax income increased 325.3 percent.”
    
  • “Counties with ten or more wells recorded an 10.8 percent increase in net profits[what business owners pay on their business earnings] between 2007 and 2008, and counties with fewer than ten wells saw a 7.1 percent increase in such income. Counties with no gas activity had increases of only 1.5 percent.”

• “Positive Economic Activity for [Marcellus] Communities”: “State tax collections in counties with significant activity related to Marcellus shale on average had larger increases in sales and personal income tax collections and less precipitous declines in realty transfer tax collections than did other Pennsylvania counties. The data indicate that Marcellus shale development brings some positive economic activity for communities.”

NOTE: Click HERE to view this study online.

Copyright: MarcellusCoalition.org

PSU Cooperative Extension: “In counties with ten or more Marcellus wells…tax income increased 325.3 percent”

Canonsburg, Pa. – The Marcellus Education Team at Penn State University’s Cooperative Extension recently issued a comprehensive analysis highlighting the positive and growing tax revenues being generated throughout the Commonwealth tied directly to the responsible development of clean-burning, homegrown natural gas. Kathryn Klaber, president and executive director of the Marcellus Shale Coalition (MSC), issued this statement regarding Penn State’s findings:

“The responsible development of clean-burning natural gas is creating tens of thousands of good-paying jobs, providing stable, American energy supplies for consumers and generating hundreds of millions of dollars in tax revenues at the same time. This data brings into perspective the enormous amount of taxes our industry’s work is generating for Pennsylvania’s economy, especially in rural communities. Without question, each and every Pennsylvanian is benefitting from Marcellus Shale development.

“Unfortunately the ongoing tax debate has been framed too narrowly. This study, however, importantly broadens the understanding of the tax revenues our industry is helping to produce for state and local governments.”

Key excepts from Penn State University’s new study: “State Tax Implications of Marcellus Shale: What the Pennsylvania Data Say in 2010”

• State Sales Tax Revenues Soar in Marcellus Producing Counties: “The data indicate that counties with 150 or more Marcellus wells experienced an 11.36 percent increase in state sales tax collections between 2007 and 2010. Counties with fewer Marcellus wells reported declining state sales tax collections, but they still did better than counties with no Marcellus wells, which reported steeper declines. These data suggest that counties with Marcellus shale development fared better in retail sales during the years 2007–2010 than those counties without.
• Realty Transfer Tax Collections in Marcellus Producing Counties Stronger than Non-Marcellus Counties: “Across the state, realty transfer tax collections were down between July 2007 and June 2010, reflecting overall weaknesses in the real estate market. However, counties with Marcellus shale development typically declined less than those without such development.”
• “Counties With Marcellus Activity Showed Greater Increases in Tax Income”: “The state personal income tax is a levy on personal income, including wages and salaries, investment income, and leasing and royalty income. Counties with Marcellus activity showed greater increases in tax income than non-Marcellus counties even though there was little difference in the number of returns filed. Counties with ten or more wells reported an average 6.96 percent increase in taxable income, and counties with between one and nine wells reported a 3.08 percent increase. Those areas with no wells witnessed a 0.89 percent increase in taxable income.”
  • “In counties with ten or more Marcellus wells, returns reporting royalty income increased 44.1 percent and tax income increased 325.3 percent.”
    
  • “Counties with ten or more wells recorded an 10.8 percent increase in net profits [what business owners pay on their business earnings] between 2007 and 2008, and counties with fewer than ten wells saw a 7.1 percent increase in such income. Counties with no gas activity had increases of only 1.5 percent.”

• “Positive Economic Activity for [Marcellus] Communities”: “State tax collections in counties with significant activity related to Marcellus shale on average had larger increases in sales and personal income tax collections and less precipitous declines in realty transfer tax collections than did other Pennsylvania counties. The data indicate that Marcellus shale development brings some positive economic activity for communities.”

NOTE: Click HERE to view this study online.

Natural gas industry committed to safety on the roads, communities in which we operate

Canonsburg, PA – At a day-long seminar yesterday in State College, the Marcellus Shale Coalition (MSC), in collaboration with the Pennsylvania State Police, Pennsylvania Department of Transportation (PennDOT), the Public Utility Commission (PUC) and the Department of Environmental Protection (DEP), hosted the first Marcellus Transportation Safety Day. The seminar’s aim was to “Better educate carriers and truck drivers supporting the natural gas industry of Pennsylvania’s regulations to improve their safe operating practices.”

The seminar included remarks from Kathryn Klaber, president and executive director of the MSC; Scott Christie, deputy secretary for Highway Administration, PennDOT; and Colonel Frank E. Pawlowski, commissioner, Pennsylvania State Police. Photos from yesterday’s event are available on the MSC’s Facebook page; to view them, click HERE.

“The natural gas industry is committed to working with state regulators and safety officials at every level of government to ensure that the safety and integrity of our roads and infrastructure are maintained as increased truck traffic associated with Marcellus development expands across the Commonwealth,” said Kathryn Klaber. “The safety of our workers and the communities in which we operate is an integral part of our Guiding Principles, and we will continue to work each day with local, state and federal officials to address these important issues. By all accounts, this event was a huge success toward achieving that common goal.”

The seminar, held at The Penn Stater Conference Center, attracted over two hundred transportation experts, truck drivers and safety coordinators that support the development of the Marcellus Shale across Pennsylvania.

Seminar breakout sessions included:

• PA State Police: Pennsylvania State Police motor carrier enforcement personnel discussed the motor carrier safety regulations with particular emphasis placed upon the most common violations found during roadside inspections of trucks supporting gas drilling operations. Following a classroom presentation, attendees participated in an actual walk-around truck inspection performed by experienced field motor carrier inspectors.
• PA Public Utility Commission: The PUC discussed the Commonwealth’s Unified Carrier Registration (UCR) program, along with the requirement for certain carriers to obtain PUC operating authority. Pennsylvania’s New Entrant Audit and Compliance Review programs and their impact on carrier operations were also addressed during this session.
• PA Dept. of Environmental Protection: DEP, Bureau of Waste Management, addressed Pennsylvania’s regulations pertaining to the transportation of environmental waste, with particular emphasis placed on the regulations that govern the transportation of waste water from Marcellus Shale gas drilling operations.
• PA Dept. of Transportation: Special Hauling Permits are required and issued for Oversize and Overweight loads using Pennsylvania’s Interstate Highways, US Routes and State Highways. During this session, PennDOT discussed the process by which these permits can be obtained and the penalties for violating their terms and conditions. This session also addressed PennDOT’s posted and bonded roads program.
• Federal Motor Carrier Safety Administration: FMCSA discussed the process by which they determine a carrier’s safety fitness rating and the consequences and intervention taken on carrier’s determined to be unsatisfactory. A new safety fitness system, Comprehensive Safety Analysis 2010, will be implemented this year and was discussed in detail.

NOTE: Click HERE to view a recent Lock Haven Express op-ed by Kathryn Klaber, which underscores the MSC’s commitment to road and infrastructure investment and safety.

Copyright Marcelluscoalition.org

• “Pennsylvania’s Marcellus Shale has been a bright spot in job creation”

• Marcellus development “to create more than 111,000 new jobs and generate $987 million in state and local tax revenue by 2011”
  
• ‘Marcellus Multiplier’ creating “a surge in real estate activity”; “There’s no question it’s having a positive impact” on regional hotels

We’re Hiring: “Shale coalition launches job site”: “The Marcellus Shale Coalition has launched a website intended to connect job seekers with its members – natural gas companies and related businesses. The “job portal” at marcelluscoalition.org offers descriptions of job opportunities and what the required qualifications are, from equipment operators and well tenders to geophysicists and market research analysts, and has links to the employment pages of companies’ websites. (Scranton Times-Tribune, 9/14/10)

“Thousands of jobs listed on a Marcellus Shale jobs website”: “The gas drilling industry is flourishing in the Northern Tier. People at Talisman Energy tell us the company is producing 200 Million cubic feet a day in Bradford, Tioga, and Sullivan counties alone. They expect that to rise to 300 million cubic feet by the end of the year. That’s enough to heat a city three times the size of Rochester. A Talisman spokesman tells us the industry is working with area schools and universities to develop a local work force. “That’s happening right now”, says spokesman, MarkScheuerman: “Penn College is doing some wonderful things in PA. Penn State is working on those things as well. Corning Community College, and Broome Community College are deeply interested in it.” There are thousands of jobs listed on a Marcellus Shale jobs website — from office support, to general labor, to scientists. (WENY-TV, 9/16/10)

Responsible Marcellus Shale Development “a modern-day gold rush” in Pa.: “Pennsylvania is on the verge of what many policy experts are calling a modern-day gold rush, thanks to the Marcellus Shale formation, a natural gas deposit that spans most of the state. … In fact, Marcellus may turn out to be the second-largest gas deposit in the world. It promises great potential for economic expansion and job creation in a state and region sorely in need of both. Development of the Marcellus Shale was one of the few bright spots in Pennsylvania’s economy last year, according to a recent Penn State study, creating44,000 new high-paying jobs and generating nearly $1.4 billion in additional federal, state and local tax revenue. In a state where unemployment has been rising toward double digits throughout the year, hitting 9.3 percent in July, the Marcellus Shale provides tremendous hope for the hundreds of thousands of Pennsylvanians seeking work. The Penn State study concluded that, in total, development of the site is likely to create more than 111,000 new jobs and generate $987 million in state and local tax revenue by 2011. (Politico Op-Ed,9/16/10)

Marcellus Shale “a bright spot in job creation”: “The natural-gas bonanza inPennsylvania’s Marcellus Shale has been a bright spot in job creation, said Angela Palumbo, an administrator for Mercer County’s CareerLink employment agency. “The Marcellus Shale is just starting to generate interest in training for these types of jobs,” Palumbo said. “Our hope is that this can help our economy turn around.” Companies that service the natural-gas industry — including manufacturers, logistics providers and water-treatment facilities — have started hiring, and more workers likely will be needed, she said. (Youngstown Vindicator, 9/16/10)

350 New Marcellus-Related Jobs En Route to Eastern Ohio: “Bill Turner, Workforce Administrator for the Trumbull County One-Stop job office in Warren, partly attributed the number of jobs to development of the Marcellus Shale natural gas formation under eastern Ohio, Pennsylvania and neighboring states, but also a gradual economic recovery that is bringing jobseekers back into the market. ”A lot of people are looking again due to encouraging news. They have more options than they did six months ago,” he said. … The Marcellus Shale is prompting global steel tubemaker V&M Star to hire 350 workers to staff the new fine-quality tube mill it’s building. (Warren Tribune Chronicle, 9/16/10)

“Shale Gas Development Safe and Beneficial”: “Natural gas production has the potential to make a tremendous positive economic impact in New York. Not long ago the Broome County government commissioned a study to explore the benefits of natural gas production. It found the Marcellus holds enough natural gas just in that single county to pave the way for 16,000 good-paying jobs, $793 million in wages, and $15.3 billion in economic output over the next 10 years. If we look to our neighbors in Pennsylvania, we already see the amazing impact of natural gas production. According to a 2009 IHS Global Insight study,natural gas supported 53,000 jobs and provided almost $13 billion in economic value in 2008 alone. … We look to Pennsylvania where more than 200,000 new jobs will be created from Marcellus development. (Press & Sun-Bulletin Op-Ed, 9/12/10)

Broad Coalition Fights for Responsible, Job-Creating Marcellus Development: “Economic development organizations and landowner groups in Wayne County issued a stinging criticism Thursday against the Delaware River Basin Commission for enacting a moratorium on natural gas drilling and causing a deep negative economic impact by effectively halting development. The pro-drilling groups, including landowners’ alliances that have secured more than 100,000 acres in Wayne County for gas development and the Wayne County Chamber of Commerce, also warned the commission not to develop stringent regulations that would exceed current state environmental regulations because it could deter companies from operating there. (Scranton Times-Tribune, 9/10/10)

Clean-Burning Marcellus Shale Natural Gas “the best news” the Region, Economy’s Had in Years: “The best news that has happened again to our region and economy in many years has been the discovery of the Marcellus gas shale formation. … We must open our minds, think, and appreciate this new-found resource. … Oil and gas have played a huge role in our development and will continue; however, we must not allow moratoriums, misinformation and over regulation to rule. (Observer-Reporter Op-Ed, 9/5/10)

MSC president: “Marcellus Shale: Rebuilding our workforce and infrastructure”: “This year alone, the Marcellus Shale industry will invest more than $100 million to repair and repave roads in the communities we operate – and in virtually every case, we’re rebuilding these roads to higher standards, ensuring their ability to handle the increased traffic and weight. These upgrades and repairs are done overwhelmingly by local contractors, another example of our industry’s robust and growing supply chain – the ‘Marcellus Multiplier’ – is helping to give a much-needed shot in the arm to local businesses and to our workforce. (Lock Haven Express Op-Ed, 9/10/10)

“Gas drilling sparks real estate windfall”: “The natural gas-rich Marcellus shale has created a surge in real estate activity in Southwest Pennsylvania. It’s not confined to leasing acres of land for natural gas drilling operations, but extends to the rental of housing and the leasing of office, industrial and warehouse space since the boom in gas exploration in the mile-deep shale began here two years ago. … The industrial and residential real estate boom has come from new companies bringing jobs and people to the region, West said. There has been no exact count of jobs created in Southwest Pennsylvania from the natural gas boom, but one estimate has 44,000 jobs being added statewide. … A survey by the Marcellus Shale Coalition, a trade group representing gas companies, found that 10 companies with operations in Southwest Pennsylvania now have 2,076 employees, and they expect to add 5,185 new jobs through 2011. (Tribune-Review, 9/12/10)

“Natural gas industry a boon to Centre County hotels”: “Occupancy rates at some Centre County hotels are booming, fueled by Marcellus Shale gas. Hotels in areas nearest gas drilling operations are boasting 30 to 50 percent increases in overnight stays thanks to the influx of personnel extracting natural gas from the rich deposits located 5,000 feet or more under the ground. Philipsburg’s Harbor Inn packed gas workers into 25 of its 65 rooms from January through June, according to general manager Dolores Hollabaugh. “Our winters are usually really slow, and having them brought us way up,” Hollabaugh said. “Revenue went up 40 percent.” … Their numbers have increased so much so that several places that previously only filled up on Penn State football weekends now report they’re regularly booked up once or twice a week. … “There’s no question it’s having a positive impact on the hotel,” Purdum said. (Centre Daily Times, 9/13/10)

Top National Energy Expert Confirms Hydraulic Fracturing’s Long Record of Safety: “Over the past 60 years, fracking has been applied to millions of wells worldwide with virtually no incident and without any physical evidence that it can contaminate drinking water. … This war on fracking jeopardizes more than $200 billion per year in U.S. economic activity, and this is just the incremental value added at the wellhead. The multiplier effect throughout the American economy of foregoing production of these valuable resources would be several times greater. (Syracuse Post-Standard Op-Ed, 9/13/10)

Copyright http://marcelluscoalition.org/

Working alongside the State Fire Academy, industry takes safety training to next level

Canonsburg, Pa. – As natural gas production from Pennsylvania’s portion of the Marcellus Shale – considered by experts to be the world’s second largest natural gas field once fully developed – continues to increase, helping to create tens of thousands of good-paying jobs across the Commonwealth, the industry is working closely with the emergency response community to ensure environmental and worker safety, a top industry-wide priority.

Launched in May, a partnership with the industry and the State Fire Academy will expand training that responders receive, adding new components targeted specifically at shale gas production. Trainings will cover a host of issues, from what to expect upon arriving at a well site, to how best to coordinate with on-site industry personnel.

“Safety is our industry’s top value, and we recognize the opportunity that the environmentally-safe and effective development of the Marcellus Shale’s clean-burning natural gas represents,” said Kathryn Klaber, president of the Marcellus Shale Coalition (MSC). “Preparing our first responders, and putting in place the best possible communication, training and educational tools is critical to ensuring that. And that’s exactly why we’re focused on proactively implementing commonsense practices that will benefit all Pennsylvanians.”

The industry’s engagement, education, preparation and outreach ranges from emergency responders to individual citizens and land owners, as well as with local and state government administrators and officials. The Pennsylvania State Fire Commissioner and Pennsylvania Emergency Management Agency (PEMA), as well as the Lycoming County Gas Exploration Task Force, continue to work in tandem with the MSC to jointly develop training curriculum for the State’s Emergency Response Communities.

These comprehensive training plans will help give Pennsylvania’s first-responders the tools needed to effectively respond to the broad range of unlikely scenarios associated with the production of these clean-burning resources. For more information on this program and future training opportunities, visit www.osfc.state.pa.us, or call 717.248.1115, to register.

Copyright Marcellus Shale Coalition’s (MSC)

Gas drilling incident in western Pennsylvania linked to firm’s corner-cutting tactics.

From staff and wire reports

HARRISBURG – Rig workers’ inexcusable failure to use a second set of pressure-control devices while preparing to connect a natural gas well to a pipeline led to the well’s blowout in western Pennsylvania last month, a consultant’s report said Tuesday.

State regulators, who hired the consultant, quickly ordered all drilling operators to adhere to a set of safety standards designed to prevent another such incident.

“I don’t know any company that would cut corners like this on this kind of well,” said consultant John Vittitow, a Texas-based petroleum engineer.

The company, Houston-based EOG Resources Inc., has used this same tactic on other wells in Pennsylvania, Vittitow said.

“I don’t think they’ll use it again,” he added.

Meanwhile, state Environmental Protection Secretary John Hanger warned that another such incident could mean the end of EOG’s business in Pennsylvania, and insisted state regulations don’t allow EOG’s tactics.

EOG and its contractor, C.C. Forbes Co. of Texas, were given maximum fines of more than $400,000 combined and ordered to take corrective actions, but were allowed to resume all activities in Pennsylvania on Tuesday after a 40-day suspension of well-finishing work.

EOG operates nearly 300 wells in Pennsylvania.

The blowout happened late June 3 on the grounds of a hunting club in Clearfield County where EOG is drilling a number of wells.

For 16 hours, explosive gas and briny wastewater shot into the air before specialists brought it under control.

Hanger insisted Tuesday that existing regulations do not allow EOG’s tactics because they require companies to obey accepted industry safety standards.

Most companies obey those, he said, but a letter sent Tuesday would lay out in detail what is expected of them.

Gary L. Smith, EOG’s vice president and general manager in Pittsburgh stated in an e-mailed that company officials “sincerely regret that the well-control issue took place.”

Since that time, Smith said, EOG has worked with the DEP to resolve all issues, will implement the new operational procedures outlined in the letter to gas well operators and looks forward to resuming activities.

Marcellus Shale Coalition president and executive director Kathryn Klaber said the new regulations DEP put forth “have already been incorporated by many of our members as part of their regular wellsite operations.”

State Rep. Phyllis Mundy, who is leading the charge for a moratorium on gas drilling in the state, said the $400,000 in fines and 40-day suspension “seems like a pittance … for what was clearly an inexcusable lack of proper procedure to care for the environment and their workers.”

Mundy, D-Kingston, said the incident “reinforces the need to hit the pause button with a moratorium. With this kind of activity, there will always be accidents.

“But with proper laws, regulations, best practice guidelines and inspections in place, we could prevent many of them and be much better prepared to deal with them when they do occur. Those things are not in place at this time, yet we continue to issue new permits. We are simply not prepared to either prevent or react to these incidents.”

Hanger said his agency would redouble its inspection activity with more emphasis on well-finishing work.

Copyright: Times Leader

The Luzerne County legislator has higher hopes for another bill related to drilling.

By Andrew M. Sederaseder@timesleader.com
Times Leader Staff Writer

State Rep. Phyllis Mundy said her proposal to establish a one-year moratorium on the issuance of new permits for drilling in the Marcellus Shale formation is well intentioned, but she does not believe it has the support of enough of her colleagues to be passed this year.

“The moratorium bill is a long shot,” Mundy, D-Kingston, said on Thursday, responding to questions related to two bills and a resolution she introduced on Wednesday. The three were referred Thursday to the state House Committee on Environmental Resources and Energy.

House Bill 2608 would prohibit natural gas drilling companies that use fracking, or horizontal drilling, from drilling wells within 2,500 feet of a primary source of supply for a community water system, such as a lake or reservoir. The current restriction is only 100 feet.

That bill gained the largest number of cosponsors, including the other six state representatives who serve Luzerne County: Karen Boback, R-Harveys Lake; Mike Carroll, D-Avoca; Eddie Day Pashinski, D-Wilkes-Barre; Todd Eachus, D-Butler Township; Jim Wansacz, D-Old Forge; and John Yudichak, D-Plymouth Township. In total, the bill has 47 cosponsors, and Mundy.

She said that legislation has the best chance of being approved, but it will likely have to be offered as an amendment to another bill.

House Resolution 864, if approved, would urge the U.S. Congress to pass the Fracturing Responsibility and Awareness of Chemicals (FRAC) Act. The resolution urges Congress to repeal a provision in the federal Safe Drinking Water Act, known as the “Halliburton loophole,” that exempts oil and gas drilling industries from restrictions on hydraulic fracturing near drinking water sources.

The act would also require oil and gas industries to disclose all hydraulic fracturing chemicals and chemical constituents currently considered proprietary rights of the company.

That resolution has the support of Mundy and 43 of her colleagues who signed on as cosponsors. Eachus, Pashinski, Wansacz and Boback were the other Luzerne County representatives who signed on as cosponsors.

House Bill 2609 seeks to establish a one-year moratorium on the issuance of new natural gas drilling permits, which Mundy said would give state officials more time to analyze the drilling industry and ensure proper protections are in place and if they’re not, what measures should be enacted.

That bill received the cosponsor support of 18 of Mundy’s colleagues, but of her fellow Luzerne County Caucus members, only Pashinski signed his name as a cosponsor. Two Lackawanna County-based state House members signed on, Kevin Murphy, D-Scranton, and Ed Staback, D-Sturges. They were among a handful of House members who signed their names as cosponsors to all three measures.

Mundy’s opponent in November, Republican Bill Goldsworthy, said the 20-year lawmaker is using Marcellus Shale exploration “to help her re-election campaign.”

“First Ms. Mundy votes to increase spending and pay for it with a new tax on gas drilling, then turns around and calls for that drilling to stop. This is the type of political double-talk that has gotten our state where we are today,” said Goldsworthy in a written statement.

Goldsworthy, the mayor of West Pittston, said he supports gas exploration, as long as it is done in an environmentally responsible manner.

“I do not think a moratorium would pass the House at this point, let alone the Senate. Perhaps a few more disasters will change people’s minds,” Mundy said, continuing to voice frustration with the way things work in Harrisburg that she expressed at a House Transportation Committee field hearing in Scranton two weeks ago. At that time, speaking about the gaping hole in the transportation budget and the state of disrepair of hundreds of roadways and bridges throughout the state, she quipped “We in Pennsylvania don’t do anything unless there’s a crisis.”

In addition to Mundy, Pashinski, Staback and Murphy, only 14 representatives signed their names as cosponsors on all three pieces.

Copyright: Times Leader