As head of Governor Tom Corbett’s Marcellus Shale Advisory Committee, Lt. Governor Jim Cawley visited the brand new U.S. headquarter of Talisman Energy in Warrendale, which he says illustrate how the Marcellus Shale industry benefits the state’s economy even in areas where drilling is not taking place.
Lt. Governor Cawley says 60% of the state’s population is in the one-third of the state that is not on top of the Marcellus shale, and they often don’t see the benefits but hear the industry is poisoning the water and not paying its fair share of taxes. Yet he says the Dept. of Revenue has found natural gas activity since 2006 responsible for $1 billion in tax revenues into the general fund
Cawley says even without a severance tax, Pennsylvania taxes are high compared to other states, so it would be possible to drive companies away.
On July 22nd, the Governor’s Marcellus Shale Advisory Committee will present its final recommendations on how best to maximize benefits without compromising public health or the environment.
Showing posts with label Marcellus Shale. Show all posts
Showing posts with label Marcellus Shale. Show all posts
Friday, July 8, 2011
Thursday, July 7, 2011
Lawmakers Could Push Shale Tax or Fee in Fall
Recent polls show the majority of Pennsylvanians support a fee or tax on natural gas drillers in the Marcellus Shale formation. But, is that enough to push the Legislature to muscle a bill through his fall? A good-government advocate says he believes lawmakers may pass a Shale tax to satisfy their constituents just in time for the campaign season next year. Tim Potts is with the non-partisan Democracy Rising Pennsylvania. He says an extraction impact fee or severance tax is inevitable. Just look at Alaska, Potts says - it collects $11 billion a year in leasing fees and extraction taxes. "Well that’s more than a third of the Pennsylvania state budget in a state that has less than the population of Philadelphia. More and more people are learning that we’re being played for chumps by not getting some money for the resources that we’re sending out of state," Potts says. He says the state’s tax revenue surplus, at more than $785 million, could have been a lot higher if there had been a natural gas driller fee in place. The large Republican majority means GOP lawmakers will have full ownership of bills that pass and fail, so he says they’ll have to answer to voters if there’s no fee or tax in the works come next year’s elections.
Wednesday, July 6, 2011
Economic Benefits of Shale Gas Touted
The American Petroleum Institute outlined the economics of domestic shale gas production today, which it says may result in a world where no one region of the world will dominate the energy supply, and the United States may not only meet its own needs but even export natural gas.
API Chief Economist John Felmy says the Marcellus Shale has the potential to be one of the largest natural gas fields in the world, and he says hydraulic fracturing can be done safely, with not one confirmed case of underground water supply contamination in the country.
People who live near drilling sites and can no longer use the water from their wells might disagree.
Felmy says a 2009 study by the Manhattan Institute found that shale gas development added more than 44,000 jobs, $389 million in state and local taxes, and nearly $4 billion in value to Pennsylvania’s economy.
Articles in the New York Times recently questioned the true scale of shale gas in the U.S., but Felmy says shale gas production tripled between 2006 and 2010 and will make up 40% of domestic production by 2020. The Department of Energy says shale gas was 15% of domestic production in 2009 and may be 25% by 2035.
Penn State Professor Terry Engelder is a member of Governor Tom Corbett’s Marcellus Shale Commission, which will issue its recommendations on or about July 22nd. He says members were astounded by the scale of economic activity in Williamsport over the last three years due to Marcellus Shale development. To critics who say the energy companies are not making money on Marcellus Shale gas wells, Engelder says the industry knows they’re making long-term investments that will not pay off for eight to ten years because of high up-front costs for drilling and infrastructure.
Wednesday, June 29, 2011
No Impact Fee for Now
State House Republicans say they will not pursue a Marcellus Shale drilling impact fee or severance tax before the summer recess.
After talk of three different amendments to attach an impact fee to a standing proposal before the House, the Republicans signaled a reversal.
The call to stand down came after Governor Tom Corbett again drew a line in the sand: that he won’t talk impact fee until he gets the final report from his appointed Marcellus Shale Impact Commission led by Lieutenant Governor Jim Cawley.
"I’m going to be supporting the work of my lieutenant governor. I have sent the message back-- if something gets to my desk, it will be vetoed."
Senate President Pro Temp Joe Scarnati introduced a drilling impact fee bill and has said passing a budget would be tough without also passing a fee on drillers. But his top aide acknowledges pushing a fee in the House now would be a poor use of time.
The House Republicans say they’ll revisit the Marcellus Shale issue in the fall – after they get a report from the lieutenant governor. House Democrats have said the proposed amendments only gave the illusion that House Republicans were serious about passing an impact fee, given the Governor’s promise of a veto.
After talk of three different amendments to attach an impact fee to a standing proposal before the House, the Republicans signaled a reversal.
The call to stand down came after Governor Tom Corbett again drew a line in the sand: that he won’t talk impact fee until he gets the final report from his appointed Marcellus Shale Impact Commission led by Lieutenant Governor Jim Cawley.
"I’m going to be supporting the work of my lieutenant governor. I have sent the message back-- if something gets to my desk, it will be vetoed."
Senate President Pro Temp Joe Scarnati introduced a drilling impact fee bill and has said passing a budget would be tough without also passing a fee on drillers. But his top aide acknowledges pushing a fee in the House now would be a poor use of time.
The House Republicans say they’ll revisit the Marcellus Shale issue in the fall – after they get a report from the lieutenant governor. House Democrats have said the proposed amendments only gave the illusion that House Republicans were serious about passing an impact fee, given the Governor’s promise of a veto.
Monday, June 27, 2011
Shale Panel to Gather at CCAC
Congressman Jason Altmire (PA-04) will gather experts and activists versed in the debate over drilling in the Marcellus shale formation in a forum Tuesday evening in McCandless. This is going to be a community discussion said Altmire, “It’s not to advocate one side over the other, it’s certainly not a political meeting but it is to give everybody the opportunity to have a panel all in the same room, at the same time, answering the same questions so hopefully we can all learn from it.” Altmire hopes the activists on both sides will not disrupt the event.
The forum runs from 7:00 p.m. to 8:30 p.m. at the Community College of Allegheny County North Campus.
Each of the seven panel members will be given a chance to make opening remarks, “and then we are going to ask the obvious questions that always come up… the things I always hear in the public, and then we are going to open it up at the end for members of the community to directly ask the panel anything that they want,” said Altmire.
Representatives from the gas industry, the environmental movement, government regulatory agencies and academicians will sit on the panel. According to Altmire, this is the issue he hears about more often than any other issue as he travels around his district.
While the forum is to explore sides of the issue, Altmire has come out in favor of drilling in the past. “If you do it right the fracking process can be done safely without the environmental impacts that some are concerned about, but there does need to be oversight, we do need to make sure corners are not cut and that the process is carried out in an environmental way,” said Altmire. At the same time Altmire says Pennsylvania should not follow the lead of New York where all drilling has been banned pending review of the process.
The forum runs from 7:00 p.m. to 8:30 p.m. at the Community College of Allegheny County North Campus.
Each of the seven panel members will be given a chance to make opening remarks, “and then we are going to ask the obvious questions that always come up… the things I always hear in the public, and then we are going to open it up at the end for members of the community to directly ask the panel anything that they want,” said Altmire.
Representatives from the gas industry, the environmental movement, government regulatory agencies and academicians will sit on the panel. According to Altmire, this is the issue he hears about more often than any other issue as he travels around his district.
While the forum is to explore sides of the issue, Altmire has come out in favor of drilling in the past. “If you do it right the fracking process can be done safely without the environmental impacts that some are concerned about, but there does need to be oversight, we do need to make sure corners are not cut and that the process is carried out in an environmental way,” said Altmire. At the same time Altmire says Pennsylvania should not follow the lead of New York where all drilling has been banned pending review of the process.
Wednesday, June 22, 2011
Think Tank Disputes Shale Jobs Numbers
Reports published by the Marcellus Shale Coalition and other pro shale industry groups in April touted the creation of 48,000 new jobs in Pennsylvania thanks to the growing shale industry, now, the left-leaning Keystone Research Group says the number is “vastly overstated.” The jobs were reportedly created between the fourth quarter of 2009 and the first quarter of 2011.
The Keystone Research Center reviewed the numbers and Executive Director Steve Herzenberg found the 48,000 number was the number of “new hires” not the number of “new jobs.” “In every industry there are a lot of new hires and a lot of quits and firings and retirements, which economists call separations, If you want to figure out what the actual job change is you have to look at both the hires and the separations, that gives you the change in jobs,” said Herzenberg.
Herzenberg believes the number is closer to 10,000 new jobs created. “When you are looking at your bank account it would be nice if you could look just at deposits but if you want an accurate picture of what’s happening with your account you have to look at the withdrawals as well,” said Herzenberg.
The Marcellus shale coalition responded by noting that many of the jobs created where in counties with higher than average unemployment and that many of the jobs in the shale industry pay well above the state average. Herzenberg does not dispute those numbers and admits that any new job is a good job in a soft economy. Herzenberg does however dispute the Shale Coalition’s claim that the report was politically timed to impact the debate over taxing the industry.
“The report that was misinterpreted came out in April, the series of press reports… came out in the very end of May, We’re a small think tank and it took us a little while to put together the briefing paper that explains carefully this misinterpretation.” Said Herzenberg.
The Keystone Research Center reviewed the numbers and Executive Director Steve Herzenberg found the 48,000 number was the number of “new hires” not the number of “new jobs.” “In every industry there are a lot of new hires and a lot of quits and firings and retirements, which economists call separations, If you want to figure out what the actual job change is you have to look at both the hires and the separations, that gives you the change in jobs,” said Herzenberg.
Herzenberg believes the number is closer to 10,000 new jobs created. “When you are looking at your bank account it would be nice if you could look just at deposits but if you want an accurate picture of what’s happening with your account you have to look at the withdrawals as well,” said Herzenberg.
The Marcellus shale coalition responded by noting that many of the jobs created where in counties with higher than average unemployment and that many of the jobs in the shale industry pay well above the state average. Herzenberg does not dispute those numbers and admits that any new job is a good job in a soft economy. Herzenberg does however dispute the Shale Coalition’s claim that the report was politically timed to impact the debate over taxing the industry.
“The report that was misinterpreted came out in April, the series of press reports… came out in the very end of May, We’re a small think tank and it took us a little while to put together the briefing paper that explains carefully this misinterpretation.” Said Herzenberg.
Friday, June 17, 2011
Councilwoman to Meet With President
Pittsburgh Councilwoman Natalia Rudiak joins a group of other young elected officials from across the country for meetings at the White House today (11 a.m. to 3 p.m.) with administration officials followed by a reception with President Obama.
Rudiak says a small number of members of the People for the American Way Foundation's Young Elected Officials Network were invited to the White House to discuss important issues facing states and municipalities. She says they will be talking about the $600 million cut this year from the Community Development Block Grants (CDBG) nationwide...
"We actually had to cut $2 million from our budget this year because of cuts from the federal government. So this actually means hundreds of less jobs for youths in our city."
Rudiak says she's also concerned that the federal COPS program, through which Pittsburgh receives a grant to keep police on the street, was trimmed by $296 million dollars when the federal government shutdown was threatened unless spending cuts were made. But Rudiak says it's not all about money, there are policy issues as well. She wants the administration including EPA officials to understand the environmental impact of Marcellus Shale drilling on Pennsylvania's environment.
Rudiak calls the president a steadfast ally to cities...."but it's important for the president to hear from young elected officials about programs meaningful to us. There are always things we need to make choices about and I think he needs to know what our highest priorities are.
Rudiak says a small number of members of the People for the American Way Foundation's Young Elected Officials Network were invited to the White House to discuss important issues facing states and municipalities. She says they will be talking about the $600 million cut this year from the Community Development Block Grants (CDBG) nationwide...
"We actually had to cut $2 million from our budget this year because of cuts from the federal government. So this actually means hundreds of less jobs for youths in our city."
Rudiak says she's also concerned that the federal COPS program, through which Pittsburgh receives a grant to keep police on the street, was trimmed by $296 million dollars when the federal government shutdown was threatened unless spending cuts were made. But Rudiak says it's not all about money, there are policy issues as well. She wants the administration including EPA officials to understand the environmental impact of Marcellus Shale drilling on Pennsylvania's environment.
Rudiak calls the president a steadfast ally to cities...."but it's important for the president to hear from young elected officials about programs meaningful to us. There are always things we need to make choices about and I think he needs to know what our highest priorities are.
Tuesday, June 14, 2011
Department of Energy Hearing
A U.S. Department of Energy Hearing on hydraulic fracturing was held in Washington County on Monday Night.
The hearing drew about 400 people, either in favor of or against hydraulic fracturing the controversial gas extraction technique that breaks up shale deep underground through unconventional methods. The technique has been responsible for water and air pollution, social ills and linked to domineering company practices in communities across the Marcellus Shale region.
An industry trade group, Energy in Depth provided all-expenses paid trips for pro-drilling landowners to travel from Northeastern Pennsylvania and New York to the meeting. Anti-drillers protested beforehand.
Both sides cheered and jeered as members of the Secretary of Energy Advisory Board listened to testimony from person after person.
Before the testimonials board member John Deutch said they were listening to hear the steps that should be taken to improve shale production in the country in an effort to reduce dependency on foreign energy.
The hearing drew about 400 people, either in favor of or against hydraulic fracturing the controversial gas extraction technique that breaks up shale deep underground through unconventional methods. The technique has been responsible for water and air pollution, social ills and linked to domineering company practices in communities across the Marcellus Shale region.
An industry trade group, Energy in Depth provided all-expenses paid trips for pro-drilling landowners to travel from Northeastern Pennsylvania and New York to the meeting. Anti-drillers protested beforehand.
Both sides cheered and jeered as members of the Secretary of Energy Advisory Board listened to testimony from person after person.
Before the testimonials board member John Deutch said they were listening to hear the steps that should be taken to improve shale production in the country in an effort to reduce dependency on foreign energy.
Friday, June 10, 2011
Rally Demanding ExxonMobil Pay Fair Share of Taxes
Marchers demanding that ExxonMobil pay a fair share of taxes will rally in Market Square today at 3:30, then proceed across the Smithfield Street Bridge to the Exxon Station on East Carson Street, where they will present a giant postcard listing the number of jobs the company could be creating in Pittsburgh.
Tom Hoffman, Western Pennsylvania Director of Clean Water Action, says companies like ExxonMobil have recovered from the recession and benefit from huge tax breaks, but cities like Pittsburgh are still suffering from cuts to education and environmental protection and a lack of funds to create jobs.
Hoffman says ExxonMobil and other companies profiting from the Marcellus Shale gas boom are "bleeding the state dry" without paying any severance taxes, so they should step up and pay a fair share.
Tom Hoffman, Western Pennsylvania Director of Clean Water Action, says companies like ExxonMobil have recovered from the recession and benefit from huge tax breaks, but cities like Pittsburgh are still suffering from cuts to education and environmental protection and a lack of funds to create jobs.
Hoffman says ExxonMobil and other companies profiting from the Marcellus Shale gas boom are "bleeding the state dry" without paying any severance taxes, so they should step up and pay a fair share.
Thursday, June 9, 2011
Warrendale Gas Co. Bought by Exxon
ExxonMobil has bought regional natural gas drillers Philips Resources and TWP in a $1.7 billion deal.
Dr. Kent Moors of Duquesne University’s Institute for Energy and the Environment says he’s not surprised by the acquisition, because big energy companies have already bought several small, local drillers.
Moors says purchases like this prove a couple of things.
“First, there is a movement from oil to natural gas. Natural gas will comprise a greater percentage of what it is these major companies actually drill, and a greater percentage of their bottom line,” says Moors. “And secondly, it makes more sense, especially for these large companies, to acquire somebody that already has experience doing it.”
The Duquesne professor says large companies want to avoid lawsuits, so they may put more resources into avoiding environmental mishaps than a smaller company might.
President Kathryn Klaber of the Marcellus Shale Coalition says the purchase shows the natural gas formation’s “transformative power” for Pennsylvania. She says investment from international companies can mean only good things for the region.
Dr. Kent Moors of Duquesne University’s Institute for Energy and the Environment says he’s not surprised by the acquisition, because big energy companies have already bought several small, local drillers.
Moors says purchases like this prove a couple of things.
“First, there is a movement from oil to natural gas. Natural gas will comprise a greater percentage of what it is these major companies actually drill, and a greater percentage of their bottom line,” says Moors. “And secondly, it makes more sense, especially for these large companies, to acquire somebody that already has experience doing it.”
The Duquesne professor says large companies want to avoid lawsuits, so they may put more resources into avoiding environmental mishaps than a smaller company might.
President Kathryn Klaber of the Marcellus Shale Coalition says the purchase shows the natural gas formation’s “transformative power” for Pennsylvania. She says investment from international companies can mean only good things for the region.
Wednesday, June 8, 2011
Protesters Don't Get To Meet With Governor
Harrisburg briefly took on the feel of Madison, Wisconsin Tuesday afternoon, when anti-drilling protesters staged a sit-in outside Governor Corbett’s office. Chants of “Corbett’s a Coward!” and “open the door!” rang out, as filmmaker Josh Fox and other environmental advocates unsuccessfully tried to schedule a meeting with the governor.
Fox, whose Academy Award-nominated documentary Gasland has become a rallying point for drilling opponents, told reporters he’s been trying to meet with Corbett for months. “We have sent letters. We have sent emails. We have sent phone calls. We have sent letters on behalf of huge numbers of people. We have never received a response,” he explained.
Fox and the other protesters made their way to Corbett’s office after a noon rally in the Capitol rotunda organized by environmental groups Clean Water Action, PennEnvironment and the Sierra Club. Myron Arnowitt, Clean Water Action’s western Pennsylvania director, said he’s frustrated. “Drilling has been going on in Pennsylvania for almost four years now. And what has our state legislature done? They have done nothing. Nothing. The problem keeps getting bigger and bigger. They keep drilling more wells. They keep having more blowouts. They keep contaminating more rivers.” Arnowitt and other speakers called for a moratorium on drilling – a politically unlikely action the rally’s crowd clearly endorsed. When Democratic Senator Daylin Leach voiced support for a severance tax, he was drowned out by calls for a full ban on drilling.
When the rally ended, many of the attendees visited lawmakers’ offices, to personally lobby for stricter regulations. Fox and several dozen other activists headed to the Capitol’s executive wing. “We were stopped at the door. We were told to call. I called several times,” Fox explained. “We had a few entertaining conversations about why they wouldn’t just come to the door and speak to us. I was sent to the scheduling person, who hung up on me. We are demanding that we have an appointment with Governor Tom Corbett to discuss what’s happening in Pennsylvania as a result of the gas drilling.”
Video shot by Roxbury News shows Fox and other organizers were less than polite about their request. “Are you telling me…that only certain people have the authority to open doors?,” he asked a Corbett staffer on the phone. Fox then pretended to be a member of the Marcellus Shale Coalition, as other protesters yelled and waved money in the air.
Regardless of their tactics, the environmental advocates aren’t alone in the frustration. Two weeks ago, a group of disabled people picketed Corbett’s office, after their attempts to set up a meeting about the Republican’s budget were been repeatedly ignored.
Many members of the press have had similar experiences. Corbett’s spokesman, Kevin Harley, ignored repeated requests for comment on this story, and hasn’t returned a call from this reporter since February 22.
Corbett was in Harrisburg on Tuesday. He gave an off-the-record talk to a group organized by Republican strategist Charlie Gerow in the morning, and headed to Washington, DC in the evening to attend a state dinner at the White House.
The anti-drilling activists have vowed to return on July 20th. They say they’ll spend all day -- and all night – at the Capitol, if they don’t get a meeting.
Fox, whose Academy Award-nominated documentary Gasland has become a rallying point for drilling opponents, told reporters he’s been trying to meet with Corbett for months. “We have sent letters. We have sent emails. We have sent phone calls. We have sent letters on behalf of huge numbers of people. We have never received a response,” he explained.
Fox and the other protesters made their way to Corbett’s office after a noon rally in the Capitol rotunda organized by environmental groups Clean Water Action, PennEnvironment and the Sierra Club. Myron Arnowitt, Clean Water Action’s western Pennsylvania director, said he’s frustrated. “Drilling has been going on in Pennsylvania for almost four years now. And what has our state legislature done? They have done nothing. Nothing. The problem keeps getting bigger and bigger. They keep drilling more wells. They keep having more blowouts. They keep contaminating more rivers.” Arnowitt and other speakers called for a moratorium on drilling – a politically unlikely action the rally’s crowd clearly endorsed. When Democratic Senator Daylin Leach voiced support for a severance tax, he was drowned out by calls for a full ban on drilling.
When the rally ended, many of the attendees visited lawmakers’ offices, to personally lobby for stricter regulations. Fox and several dozen other activists headed to the Capitol’s executive wing. “We were stopped at the door. We were told to call. I called several times,” Fox explained. “We had a few entertaining conversations about why they wouldn’t just come to the door and speak to us. I was sent to the scheduling person, who hung up on me. We are demanding that we have an appointment with Governor Tom Corbett to discuss what’s happening in Pennsylvania as a result of the gas drilling.”
Video shot by Roxbury News shows Fox and other organizers were less than polite about their request. “Are you telling me…that only certain people have the authority to open doors?,” he asked a Corbett staffer on the phone. Fox then pretended to be a member of the Marcellus Shale Coalition, as other protesters yelled and waved money in the air.
Regardless of their tactics, the environmental advocates aren’t alone in the frustration. Two weeks ago, a group of disabled people picketed Corbett’s office, after their attempts to set up a meeting about the Republican’s budget were been repeatedly ignored.
Many members of the press have had similar experiences. Corbett’s spokesman, Kevin Harley, ignored repeated requests for comment on this story, and hasn’t returned a call from this reporter since February 22.
Corbett was in Harrisburg on Tuesday. He gave an off-the-record talk to a group organized by Republican strategist Charlie Gerow in the morning, and headed to Washington, DC in the evening to attend a state dinner at the White House.
The anti-drilling activists have vowed to return on July 20th. They say they’ll spend all day -- and all night – at the Capitol, if they don’t get a meeting.
Saturday, June 4, 2011
Flow of Fracking Water to Treatment Plants Stopped?
Officials with the Pennsylvania Department of Environmental Protection believe that companies drilling for natural gas in the Marcellus Shale formation have just about stopped shipping chemically-treated waste water to treatment plants. The DEP had said a May 19th deadline for companies to voluntarily stop taking the waste water to the treatment plants that discharge into rivers. The agency says the plants are ill-equipped to remove all the pollutants. Department spokeswoman Katy Gresh says they've confirmed the transport of the fracking water is down to possibly a handful of trucks in the past 2 weeks, and they are trying to determine if those trucks did indeed carry the waste water.
Friday, June 3, 2011
More Shale Tax Ideas Floated
Two more severance tax proposals are joining the party in Harrisburg.
The new bills come from Republicans legislators from the southeastern corner of the state where there is little or no Marcellus shale. However, they are the latest sign of growing support for some sort of tax on Marcellus Shale drilling. At least five tax or fee proposals are now in front of the General Assembly.
Senate Majority Leader Dominic Pileggi and Rep. Nick Miccarelli are both introducing levies that would direct revenue toward tax relief. The two measures are a far cry from Senate President Pro Tem Joe Scarnati’s impact fee, which would funnel money to local governments in the Marcellus Shale formation, as well as environmental and infrastructure projects.
Pileggi’s measure would fund a property tax freeze for senior citizens. According to a co-sponsorship memo distributed to senators, “all revenue would be deposited into a dedicated fund to provide a school property tax freeze for Pennsylvania residents 65 and older. …the tax burden would be shifted from seniors, many of whom are struggling to stay in their homes on a fixed income, to companies involved in natural gas drilling in Pennsylvania.” Pileggi’s memo doesn’t mention a specific tax rate, but claims the “reasonable and competitive tax” would raise $250 million over the next five years.
Miccarelli’s measure would impose a three percent tax on drillers. “The money would go directly to reducing the personal income tax from 3.07 percent to 2.99 percent,” explained Miccarelli. The tax would eventually increase to five percent, and, he claims, “would generate, by fiscal year 2015, $1.1 billion.”
Pileggi and Miccarelli both represent districts in the Philadelphia area, where support for a severance tax is most intense. Neither of their constituents would see any benefit from Scarnati’s impact fee, which limits revenue to communities where drilling is actually taking place. In his memo, Pileggi writes he, “support[s] Senator Scarnati’s approach,” but if a tax or fee becomes law, the Republican wants to spread its funds around. “My view is that the entire commonwealth needs to benefit from an extraction tax, regardless of whether or not communities have wells or pipelines in their own area,” he said, on the day Scarnati unveiled his plan. Scarnati’s chief of staff, Drew Crompton, did not respond to a request for comment on the new proposals.
Neither new tax has been formally introduced yet. Miccarelli said he’ll release his bill next week. It’s unclear when Pileggi’s plan will be unveiled.
The new bills come from Republicans legislators from the southeastern corner of the state where there is little or no Marcellus shale. However, they are the latest sign of growing support for some sort of tax on Marcellus Shale drilling. At least five tax or fee proposals are now in front of the General Assembly.
Senate Majority Leader Dominic Pileggi and Rep. Nick Miccarelli are both introducing levies that would direct revenue toward tax relief. The two measures are a far cry from Senate President Pro Tem Joe Scarnati’s impact fee, which would funnel money to local governments in the Marcellus Shale formation, as well as environmental and infrastructure projects.
Pileggi’s measure would fund a property tax freeze for senior citizens. According to a co-sponsorship memo distributed to senators, “all revenue would be deposited into a dedicated fund to provide a school property tax freeze for Pennsylvania residents 65 and older. …the tax burden would be shifted from seniors, many of whom are struggling to stay in their homes on a fixed income, to companies involved in natural gas drilling in Pennsylvania.” Pileggi’s memo doesn’t mention a specific tax rate, but claims the “reasonable and competitive tax” would raise $250 million over the next five years.
Miccarelli’s measure would impose a three percent tax on drillers. “The money would go directly to reducing the personal income tax from 3.07 percent to 2.99 percent,” explained Miccarelli. The tax would eventually increase to five percent, and, he claims, “would generate, by fiscal year 2015, $1.1 billion.”
Pileggi and Miccarelli both represent districts in the Philadelphia area, where support for a severance tax is most intense. Neither of their constituents would see any benefit from Scarnati’s impact fee, which limits revenue to communities where drilling is actually taking place. In his memo, Pileggi writes he, “support[s] Senator Scarnati’s approach,” but if a tax or fee becomes law, the Republican wants to spread its funds around. “My view is that the entire commonwealth needs to benefit from an extraction tax, regardless of whether or not communities have wells or pipelines in their own area,” he said, on the day Scarnati unveiled his plan. Scarnati’s chief of staff, Drew Crompton, did not respond to a request for comment on the new proposals.
Neither new tax has been formally introduced yet. Miccarelli said he’ll release his bill next week. It’s unclear when Pileggi’s plan will be unveiled.
Thursday, June 2, 2011
The Changing Face of Washington County
There has been a lot of discourse about Marcellus Shale drilling. You’ve heard the two most common arguments – that it’s good for the economy and its bad for the environment. But today, we’re going to talk about something a little bit different. All the drilling is significantly changing the landscape of the region.
Back in 2006 there were 24 permits issued for Marcellus Shale drilling in Washington County. The natural gas extraction process of hydraulic fracturing was in an earlier experimental phase and not as well known. Things have changed. Last year, 250 permits were issued in Washington County. Wells upon wells are getting drilled. There are compressor stations and pipelines and more on the way. You can’t turn on a television without seeing a natural gas industry ad and every day, newspapers are full of stories. It’s what people talk about.
They have strong opinions. This is serious business. It could ruin the landscape and damage our water, poison our air, destroy our health. Wells explode. Workers get hurt. But –and this is what makes it tricky, it can create jobs, provide money and wean us off a dependency on foreign energy.
But of all the things people disagree on, there is one thing they do agree on. The Marcellus Shale, the drilling, the discourse, all of it are drastically changing the face and character of the region.
If you’ve never been, Washington County sits to the south of Allegheny County. At a little over 200,000, the entire county’s population is less than the population of the city of Pittsburgh. But by square mile acreage, the county is bigger than Allegheny County. So it’s a lot of land for a lot fewer people. With a few exceptions, it’s mostly rural, with miles of two lane roads, acres of rolling hills and vistas of trees. It’s quiet. Which is why Wayne Thompson chose to live here.
"I moved out here to Buffalo Township about 14 years ago. And I moved out here specifically to get away from the city. I mean I grew up, I could see the arches of the West End bridge out my bedroom window and I specifically picked this location to get away from the traffic, to get away from the noise," he said.
Wayne lives in a custom built log cabin off an interchange of gravely roads. It’s the kind of place that he used to cheerfully call “the middle of nowhere.”
But a few years ago, things started changing. First he was approached by a land–man – someone who wanted him to lease his land.
He signed on with Range Resources. Drilling hasn’t started yet on his five acres. But now, if you look out a window on one side of his home you see a chain of flares from rigs that have been burning nonstop for weeks. You can also hear them. They sound like an airplane flying overhead. If you look out the other side you see the beginnings of a massive compressor station.
Kevin Sunday, a spokesman for the Department of Environmental Protection told DUQ that they’ve given a permit to MarkWest for 6 compressor station engines with a stack, two oxidation catalyst engines, four other engines and a dehydrator. That’s 13 buildings.
Listen to the story here.
Back in 2006 there were 24 permits issued for Marcellus Shale drilling in Washington County. The natural gas extraction process of hydraulic fracturing was in an earlier experimental phase and not as well known. Things have changed. Last year, 250 permits were issued in Washington County. Wells upon wells are getting drilled. There are compressor stations and pipelines and more on the way. You can’t turn on a television without seeing a natural gas industry ad and every day, newspapers are full of stories. It’s what people talk about.
They have strong opinions. This is serious business. It could ruin the landscape and damage our water, poison our air, destroy our health. Wells explode. Workers get hurt. But –and this is what makes it tricky, it can create jobs, provide money and wean us off a dependency on foreign energy.
But of all the things people disagree on, there is one thing they do agree on. The Marcellus Shale, the drilling, the discourse, all of it are drastically changing the face and character of the region.
If you’ve never been, Washington County sits to the south of Allegheny County. At a little over 200,000, the entire county’s population is less than the population of the city of Pittsburgh. But by square mile acreage, the county is bigger than Allegheny County. So it’s a lot of land for a lot fewer people. With a few exceptions, it’s mostly rural, with miles of two lane roads, acres of rolling hills and vistas of trees. It’s quiet. Which is why Wayne Thompson chose to live here.
"I moved out here to Buffalo Township about 14 years ago. And I moved out here specifically to get away from the city. I mean I grew up, I could see the arches of the West End bridge out my bedroom window and I specifically picked this location to get away from the traffic, to get away from the noise," he said.
Wayne lives in a custom built log cabin off an interchange of gravely roads. It’s the kind of place that he used to cheerfully call “the middle of nowhere.”
But a few years ago, things started changing. First he was approached by a land–man – someone who wanted him to lease his land.
He signed on with Range Resources. Drilling hasn’t started yet on his five acres. But now, if you look out a window on one side of his home you see a chain of flares from rigs that have been burning nonstop for weeks. You can also hear them. They sound like an airplane flying overhead. If you look out the other side you see the beginnings of a massive compressor station.
Kevin Sunday, a spokesman for the Department of Environmental Protection told DUQ that they’ve given a permit to MarkWest for 6 compressor station engines with a stack, two oxidation catalyst engines, four other engines and a dehydrator. That’s 13 buildings.
Listen to the story here.
Monday, May 30, 2011
Feds, State Officials Meet on Criminal Enforcment of Drilling
Oversight of, or enforcement against Marcellus Shale gas drillers might call to mind the federal Environmental Protection Agency or the Pennsylvania Department of Environmental Protection.
Last week in State College more than 200 federal, state and local law enforcement officers, prosecutors and environmental officials from Pennsylvania, New York, West Virginia and Ohio participated in a 2-day Marcellus Shale Law Enforcement Training Conference.
The conference focused on potential environmental impacts and law enforcement issues arising from the rapid expansion of drilling in the Marcellus Shale region.
Ignacio Moreno, Assistant Attorney General at the Justice Department, said oil and gas extraction is occurring with increasing frequency......
"We must ensure that all laws intended to protect human health, sources of drinking water, wildlife and the environment are well understood and enforced to mitigate any potential adverse effects."
According to David Hickton, U.S. Attorney for Western Pennsylvania, the conference provided an overview of state and federal requirements that companies and subcontractors must follow to ensure that workers, the public and the environment are not put at risk. Hickton says his office has a responsibility to prosecute environmental crimes....
"If the frack water (used to break the shale and released the gas) is not handled properly and, for example, is dumped without proper disposition, there would be potential criminal issues involved."
Hickton says cooperation with state and local law enforcement is imperative because the federal authorities "do not have enough boots on the ground to cover the entire state." He says one goal of the conference was to create a "force multiplier" where all law enforcement works together to enforce the various laws.
"I think the buzzword for our current approach is we're trying to be alert, informed and vigilant and the public should know we're going to do our part to protect the law so that whatever is done with Marcellus Shale is done legally and appropriately."
Last week in State College more than 200 federal, state and local law enforcement officers, prosecutors and environmental officials from Pennsylvania, New York, West Virginia and Ohio participated in a 2-day Marcellus Shale Law Enforcement Training Conference.
The conference focused on potential environmental impacts and law enforcement issues arising from the rapid expansion of drilling in the Marcellus Shale region.
Ignacio Moreno, Assistant Attorney General at the Justice Department, said oil and gas extraction is occurring with increasing frequency......
"We must ensure that all laws intended to protect human health, sources of drinking water, wildlife and the environment are well understood and enforced to mitigate any potential adverse effects."
According to David Hickton, U.S. Attorney for Western Pennsylvania, the conference provided an overview of state and federal requirements that companies and subcontractors must follow to ensure that workers, the public and the environment are not put at risk. Hickton says his office has a responsibility to prosecute environmental crimes....
"If the frack water (used to break the shale and released the gas) is not handled properly and, for example, is dumped without proper disposition, there would be potential criminal issues involved."
Hickton says cooperation with state and local law enforcement is imperative because the federal authorities "do not have enough boots on the ground to cover the entire state." He says one goal of the conference was to create a "force multiplier" where all law enforcement works together to enforce the various laws.
"I think the buzzword for our current approach is we're trying to be alert, informed and vigilant and the public should know we're going to do our part to protect the law so that whatever is done with Marcellus Shale is done legally and appropriately."
Wednesday, May 25, 2011
Bill to Require Posting of Gas Wells' GPS Locations
A Pennsylvania Senate committee has passed a bill to document the exact location of every Marcellus Shale natural gas well in the state.
Sponsoring Senator Lisa Baker says emergency crews often cannot find gas wells in emergency situations. Baker, a Republican representing six northeastern counties, says if the GPS coordinates of each site were documented, responders could look up the well's location easily and arrive sooner.
In addition, gas well operators would need to submit emergency response plans to the local 911 center, to the Pennsylvania Emergency Management Agency, and to the state's Department of Environmental Protection.
"When every second counts in an emergency, this bill will cut down on emergency response time and keep small incidents from escalating into major accidents," writes Baker in a news release.
After unanimous approval from the Senate Veterans Affairs and Emergency Preparedness Committee, the measure now moves to the full Senate for consideration.
Sponsoring Senator Lisa Baker says emergency crews often cannot find gas wells in emergency situations. Baker, a Republican representing six northeastern counties, says if the GPS coordinates of each site were documented, responders could look up the well's location easily and arrive sooner.
In addition, gas well operators would need to submit emergency response plans to the local 911 center, to the Pennsylvania Emergency Management Agency, and to the state's Department of Environmental Protection.
"When every second counts in an emergency, this bill will cut down on emergency response time and keep small incidents from escalating into major accidents," writes Baker in a news release.
After unanimous approval from the Senate Veterans Affairs and Emergency Preparedness Committee, the measure now moves to the full Senate for consideration.
Tuesday, May 24, 2011
PA House Expected to Pass Budget Today
Pennsylvania House Speaker Sam Smith doesn’t support a local impact fee on natural gas drilling, and seems apathetic to the idea at best. But, speaking to the Pennsylvania Press Club in Harrisburg Monday afternoon, the Republican predicted the General Assembly will pass some sort of levy on drillers this year.
After a lengthy filibuster on whether he supports the bill authored by his former roommate, Senate President Pro Tem Joe Scarnati, Smith said, “the political realities of how the House and Senate shape up would suggest that something will happen on that issue in the very near future, whether that means the next two months, month and a half, or on the governor’s timeline. But I believe something will be resolved on that.” Corbett wants a fee vote after his Marcellus Shale Commission’s late July report, but Scarnati is pushing for the bill to become law by the end of June.
Smith says the major factor will be where the fee money goes. Right now, the Senate measure directs funding to local governments, environmental protection efforts and infrastructure projects. He also dismissed polls showing overwhelming public support for a full tax on drillers. “People have always been willing to tax the other guy, and that’s an industry is perceived as the other guy,” he reasoned. “So I don’t jump – get too excited about how the polls read, because the same polls will say, increase spending for this, but don’t tax me on that.”
On the overall budget, Smith resisted the idea of directing all or part of a $503 million tax surplus into next year’s spending plan. “[Republicans are] trying to avoid the ‘let’s spend every penny we can possibly get our hands on’ mentality,” he said. “…Moving forward with caution to allow for reliability and predictability in the program funding.” That being said, the Jefferson County lawmaker left the door open to a budget spending more than $27.3 billion, if analysts can show this year’s surplus is part of a long-term trend. He explained, “If the budget secretary and the governor’s office revise their revenue estimate once we get past the May numbers, and when they look at whatever the other economic projections are for forecasting the numbers for next year, certainly we would be open-minded to [a more expensive budget].” Both Corbett and Smith’s majority leader, Mike Turzai, are dead-set against spending more than $27.3 billion. Smith’s comments put him more in line with Senate Majority Leader Dominic Pileggi, who’s open to using the surplus money to augment education cuts.
The House begins debate on its budget this afternoon, and will likely pass the bill by the end of the week.
After a lengthy filibuster on whether he supports the bill authored by his former roommate, Senate President Pro Tem Joe Scarnati, Smith said, “the political realities of how the House and Senate shape up would suggest that something will happen on that issue in the very near future, whether that means the next two months, month and a half, or on the governor’s timeline. But I believe something will be resolved on that.” Corbett wants a fee vote after his Marcellus Shale Commission’s late July report, but Scarnati is pushing for the bill to become law by the end of June.
Smith says the major factor will be where the fee money goes. Right now, the Senate measure directs funding to local governments, environmental protection efforts and infrastructure projects. He also dismissed polls showing overwhelming public support for a full tax on drillers. “People have always been willing to tax the other guy, and that’s an industry is perceived as the other guy,” he reasoned. “So I don’t jump – get too excited about how the polls read, because the same polls will say, increase spending for this, but don’t tax me on that.”
On the overall budget, Smith resisted the idea of directing all or part of a $503 million tax surplus into next year’s spending plan. “[Republicans are] trying to avoid the ‘let’s spend every penny we can possibly get our hands on’ mentality,” he said. “…Moving forward with caution to allow for reliability and predictability in the program funding.” That being said, the Jefferson County lawmaker left the door open to a budget spending more than $27.3 billion, if analysts can show this year’s surplus is part of a long-term trend. He explained, “If the budget secretary and the governor’s office revise their revenue estimate once we get past the May numbers, and when they look at whatever the other economic projections are for forecasting the numbers for next year, certainly we would be open-minded to [a more expensive budget].” Both Corbett and Smith’s majority leader, Mike Turzai, are dead-set against spending more than $27.3 billion. Smith’s comments put him more in line with Senate Majority Leader Dominic Pileggi, who’s open to using the surplus money to augment education cuts.
The House begins debate on its budget this afternoon, and will likely pass the bill by the end of the week.
Monday, May 23, 2011
Drilling Group Wants Consistent Regs
The head of Pennsylvania’s Marcellus Shale Coalition is calling for uniform local drilling standards.
Katheryn Klaber’s request to Governor Corbett’s Marcellus Shale Commission is for “clarity and consistency” in local laws governing natural gas drilling. She pointed out the gas deposit stretches through 37 Pennsylvania counties and 1,491 municipalities. “If you were going to take a drive across Pennsylvania, and you needed to get a new license in each community you went through, that’s really the conditions in which the industry is operating,” she said.
Klaber complained a handful of municipalities – most notably Pittsburgh -- have passed regulations banning drilling or hydraulic fracturing within their boundaries, and argued those ordinances violate state law. She said other municipalities have accomplished the same result, through zoning restrictions targeting drilling, “including up to 1,500 feet from a resident, 2,500 feet – it goes on and on. All sorts of different setbacks from all types of structures,” she explained. “And what you really get in those types of situations, I guess it would be an effective ban. Because by the time you do that many setbacks, there isn’t any other area within that municipality to place the industry’s activities.”
Klaber got her figures from a Coalition study of drilling regulations in 66 southwestern Pennsylvania municipalities. The reports’ details haven’t been made public. (I’ve asked the Coalition for a list of the municipalities with these guidelines. Klaber told a Pittsburgh Post-Gazette reporter the group isn’t ready to release them yet.)
She said some townships have gone as far as banning nighttime noise increases over 5 decibels, in an attempt to keep rigs away. “If this were applied uniformly, those levels would be violated by a residential central air conditioning units, or quite literally, in some areas, the crickets,” she argued. “This is an area that can be dealt with, if there are reasonable and predictable noise standards. But when normal, unamplified conversations are between 60 and 70 decibels, it’s a little hard to operate. And it’s not appropriate for it to be on one single industry.”
Senate President Pro Tem Joe Scarnati’s local impact fee attempts to address Klaber’s concerns, by creating a model ordinance for municipalities, and barring local governments that pass stricter laws from receiving money from its $10,000- a-well levy.
For the most part, members of Corbett’s commission were sympathetic to Klabers’ concerns. Public Utility Commission Chair Robert Powelson compared Pittsburgh’s drilling ban to a “Model UN ordinance.” David Sanko, the executive director of the Pennsylvania State Township Supervisors Association, agreed “the industry should not be singled out differently,” when it comes to zoning. “It should be treated fairly, and it should have a level playing field,” he added, before arguing local drilling bans are “in violation of state law.”
At a press conference after the meeting, however, Lieutenant Governor Jim Cawley shied away from fully weighing in on whether municipalities have the right to keep drilling out of their borders, through direct or indirect bans. “I don’t have first-hand knowledge of the sum of the claims that were put forward about constitutional violations,” he said. “Any time the constitution is violated I’m going to be concerned. But that’s something we’re going to take a look at in greater depth, to understand the specific areas of where those claims have arisen.” The commission will hear from local government officials at next month’s meeting. Its final report is due in July.
Katheryn Klaber’s request to Governor Corbett’s Marcellus Shale Commission is for “clarity and consistency” in local laws governing natural gas drilling. She pointed out the gas deposit stretches through 37 Pennsylvania counties and 1,491 municipalities. “If you were going to take a drive across Pennsylvania, and you needed to get a new license in each community you went through, that’s really the conditions in which the industry is operating,” she said.
Klaber complained a handful of municipalities – most notably Pittsburgh -- have passed regulations banning drilling or hydraulic fracturing within their boundaries, and argued those ordinances violate state law. She said other municipalities have accomplished the same result, through zoning restrictions targeting drilling, “including up to 1,500 feet from a resident, 2,500 feet – it goes on and on. All sorts of different setbacks from all types of structures,” she explained. “And what you really get in those types of situations, I guess it would be an effective ban. Because by the time you do that many setbacks, there isn’t any other area within that municipality to place the industry’s activities.”
Klaber got her figures from a Coalition study of drilling regulations in 66 southwestern Pennsylvania municipalities. The reports’ details haven’t been made public. (I’ve asked the Coalition for a list of the municipalities with these guidelines. Klaber told a Pittsburgh Post-Gazette reporter the group isn’t ready to release them yet.)
She said some townships have gone as far as banning nighttime noise increases over 5 decibels, in an attempt to keep rigs away. “If this were applied uniformly, those levels would be violated by a residential central air conditioning units, or quite literally, in some areas, the crickets,” she argued. “This is an area that can be dealt with, if there are reasonable and predictable noise standards. But when normal, unamplified conversations are between 60 and 70 decibels, it’s a little hard to operate. And it’s not appropriate for it to be on one single industry.”
Senate President Pro Tem Joe Scarnati’s local impact fee attempts to address Klaber’s concerns, by creating a model ordinance for municipalities, and barring local governments that pass stricter laws from receiving money from its $10,000- a-well levy.
For the most part, members of Corbett’s commission were sympathetic to Klabers’ concerns. Public Utility Commission Chair Robert Powelson compared Pittsburgh’s drilling ban to a “Model UN ordinance.” David Sanko, the executive director of the Pennsylvania State Township Supervisors Association, agreed “the industry should not be singled out differently,” when it comes to zoning. “It should be treated fairly, and it should have a level playing field,” he added, before arguing local drilling bans are “in violation of state law.”
At a press conference after the meeting, however, Lieutenant Governor Jim Cawley shied away from fully weighing in on whether municipalities have the right to keep drilling out of their borders, through direct or indirect bans. “I don’t have first-hand knowledge of the sum of the claims that were put forward about constitutional violations,” he said. “Any time the constitution is violated I’m going to be concerned. But that’s something we’re going to take a look at in greater depth, to understand the specific areas of where those claims have arisen.” The commission will hear from local government officials at next month’s meeting. Its final report is due in July.
Wednesday, May 18, 2011
Shale Geologist to Speak at Science Center
The Carnegie Science Center is bringing in an energy company executive tomorrow night to speak about the energy potential of the Marcellus Shale.
EQT geologist Lindell Bridges will talk about the shale drilling process, the total amount of natural gas in the Marcellus Shale, and environmental risks and safeguards.
Carnegie Science Center Director of Science and Education John Radzilowicz says this is the last of three public forums held in the Center’s Drilling Down on the Marcellus Shale speaker series.
“Our first presentation in the series was about, ‘What is Marcellus Shale? Where is it located? How did it form? What kind of resources are there?’” says Radzilowicz. “Our second talk was about the environmental impact. We wanted to talk about, ‘What are the risks dealing with water, for example?’ And so we addressed that issue. And now, in our third and final talk in the series, we want to talk about the energy potential.”
Radzilowicz says the series is strictly scientific and advocates no particular bias about the Marcellus Shale. He says it’s important that the public has a factual grasp of such an important issue.
The presentation will be followed by a question-and-answer session and refreshments.
One can register for tomorrow night’s forum by calling the Science Center at (412) 237-3400 [ext. 7] or by visiting its website.
EQT geologist Lindell Bridges will talk about the shale drilling process, the total amount of natural gas in the Marcellus Shale, and environmental risks and safeguards.
Carnegie Science Center Director of Science and Education John Radzilowicz says this is the last of three public forums held in the Center’s Drilling Down on the Marcellus Shale speaker series.
“Our first presentation in the series was about, ‘What is Marcellus Shale? Where is it located? How did it form? What kind of resources are there?’” says Radzilowicz. “Our second talk was about the environmental impact. We wanted to talk about, ‘What are the risks dealing with water, for example?’ And so we addressed that issue. And now, in our third and final talk in the series, we want to talk about the energy potential.”
Radzilowicz says the series is strictly scientific and advocates no particular bias about the Marcellus Shale. He says it’s important that the public has a factual grasp of such an important issue.
The presentation will be followed by a question-and-answer session and refreshments.
One can register for tomorrow night’s forum by calling the Science Center at (412) 237-3400 [ext. 7] or by visiting its website.
Tuesday, May 17, 2011
DEP Fines Marcellus Driller
The Pennsylvania Department of Environmental Protection has fined Chesapeake Energy more than $1 million for two separate drilling-related incidents. Under a Consent Order and Agreement (COA) Chesapeake will pay the DEP $900,000 for contaminating private water supplies in Bradford County.
At various times during 2010, DEP investigated complaints from residents of Tuscarora, Terry, Monroe, Towanda and Wilmot townships near Chesapeake’s shale drilling operations about contamination of their private water wells. DEP determined that because of improper well casing and cementing in shallow zones, natural gas from non-shale shallow gas formations had experienced gas migration into groundwater and contaminated 16 families’ drinking water supplies.
$200,000 of that amount will be dedicated to the agency's well-plugging fund which is used to mitigate historic and recent gas migration where the source of the gas cannot be determined.
As part of this COA, the company must create a plan, approved by the DEP, that outlines corrective actions, remediates contaminated water supplies, and report water supply complaints to the DEP.
Chesapeake was also fined $188,000 for a February 23 fire at a drilling site in Avella, Washington County. Three subcontractors ate the site were injured when 3 condensate (wet gas) separator tanks caught fire. The DEP investigated and determined the cause was improper handling and management of the condensate. Under this COA, Cheseapeake must submit for approval a management plan for each well site that might produce condensate.
DEP Secretary Mike Krancer said it's important that natural gas drillers take seriously their responsibilities to comply with state regulations and "that their actions do not risk public health and safety or the environment. The water well contamination fine is the largest single penalty DEP has ever assessed against an oil and gas operator, and the Avella tank fire penalty is the largest we could assess under the Oil and Gas Act."
“We worked in coordination, in cooperation, with the Pennsylvania Department of Environmental Protection, from that moment, to try and assess what the situation was, and what actions needed to be taken to address the situation and correct the problem,” said company spokesman Matt Sheppard. “And we’ve done that with enhanced casing and cementing program.” While Chesapeake is cooperating, the company hasn’t admitted to causing the Bradford County water well problems. Its statement calls a joint company and DEP investigation of the contaminations “inconclusive.”
At various times during 2010, DEP investigated complaints from residents of Tuscarora, Terry, Monroe, Towanda and Wilmot townships near Chesapeake’s shale drilling operations about contamination of their private water wells. DEP determined that because of improper well casing and cementing in shallow zones, natural gas from non-shale shallow gas formations had experienced gas migration into groundwater and contaminated 16 families’ drinking water supplies.
$200,000 of that amount will be dedicated to the agency's well-plugging fund which is used to mitigate historic and recent gas migration where the source of the gas cannot be determined.
As part of this COA, the company must create a plan, approved by the DEP, that outlines corrective actions, remediates contaminated water supplies, and report water supply complaints to the DEP.
Chesapeake was also fined $188,000 for a February 23 fire at a drilling site in Avella, Washington County. Three subcontractors ate the site were injured when 3 condensate (wet gas) separator tanks caught fire. The DEP investigated and determined the cause was improper handling and management of the condensate. Under this COA, Cheseapeake must submit for approval a management plan for each well site that might produce condensate.
DEP Secretary Mike Krancer said it's important that natural gas drillers take seriously their responsibilities to comply with state regulations and "that their actions do not risk public health and safety or the environment. The water well contamination fine is the largest single penalty DEP has ever assessed against an oil and gas operator, and the Avella tank fire penalty is the largest we could assess under the Oil and Gas Act."
“We worked in coordination, in cooperation, with the Pennsylvania Department of Environmental Protection, from that moment, to try and assess what the situation was, and what actions needed to be taken to address the situation and correct the problem,” said company spokesman Matt Sheppard. “And we’ve done that with enhanced casing and cementing program.” While Chesapeake is cooperating, the company hasn’t admitted to causing the Bradford County water well problems. Its statement calls a joint company and DEP investigation of the contaminations “inconclusive.”
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