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The Marcellus Watch

Note: The following is the second in a series of columns by Peter Mantius of Burdett -- a financial, legal and political reporter at the Atlanta Constitution for 17 years and former editor of two business weeklies in the Northeast -- on matters relating to the Marcellus Shale. For a look at his first column, click here.

NY Times Cuts and Runs

By Peter Mantius

BURDETT, Oct. 21-- In a spasm of naked NIMBYism*, The New York Times is calling for a total ban on all natural gas drilling within New York City’s watershed, citing potential threats to the city’s drinking water.

Then in the same lead editorial (Saturday, Oct. 17), the newspaper washes its hands of the identical threat to the Southern Tier. Drilling upstate would be just fine with the Times. In fact, drilling outside the city’s watershed could “add to the region’s energy supplies and lift … the upstate economy.”

That haughty double standard irritated dozens of people who responded by posting web comments, such as this one: “This editorial should have been read by and pulled prior to publication by someone who cares about all Americans, not just those who live in New York City.”

Still, The Times’ interest in the subject underscores the urgent need for Schuyler Country residents and businesses to get up to speed quickly on the costs and benefits of the gas drilling boom that many experts see as inevitable.

A new drilling technology called hydro-fracking makes it economical to tap the Marcellus Shale gas reserves that lay thousands of feet below the surface of the Southern Tier, Pennsylvania, West Virginia and Ohio. The latest technique is controversial because it requires huge quantities of water and sand, as well as proprietary toxic chemicals.

Major oil and gas companies are lining up to cash in. The big bucks they’re offering for new gas drilling leases reflects their heightened interest. It also guarantees they’ll have a local welcoming committee.

Gas drilling has taken off in northern Pennsylvania, which is already coping with fracking chemical spills and fish kills.

But Schuyler County has some breathing room – at least several months, maybe more – for several reasons:

1/ New York State has imposed a moratorium on hydro-fracking until proposed state drilling regulations are approved. The deadline for written comments on the rules (http://www.dec.ny.gov/energy/58440.html) is fast approaching – Nov. 30 – but there’s an excellent chance it will be extended. The state Department of Environmental Conservation has also scheduled a public hearing on the rules for Wednesday, Nov. 18, at Corning East High School (201 Cantigny St., Corning). Doors will open at 6 for people who want to sign up to speak. The open session begins at 7 p.m. Other DEC hearings on the regs are set for Oct. 28 in Lake Sheldrake, Nov. 10 in New York City and Nov. 12 in Chenango Bridge.

2/ At least one group of Schuyler County property owners is organizing to negotiate with gas drillers for favorable property lease terms. Drillers aren’t likely to make major moves here before those arrangements have been completed.

3/ The market price of natural gas is relatively low. At a time when their expected returns are modest, gas drillers are under less pressure to develop quickly. They can focus on developing their most productive sites that already have permits. Of course, a spike in the market price would spur the drilling process everywhere.

4/ The DEC doesn’t have the staff needed to carry out all the items included in its proposed drilling regulations. The rules call for more hands-on inspections of drilling sites. New state drilling fees could cover those new positions. But state legislation would have to earmark the new revenue for DEC staff, rather than the state’s general fund. That won’t be simple or easy in Albany. If it remains understaffed, expect the DEC to take its time issuing drilling permits.

Many communities, including Schuyler County, are using the calm before the drilling boom storm to put in place local rules for drillers.

This summer, employees of the Cornell Cooperative Extension helped organize the Schuyler County Energy Task Force to consider the likely impact of gas drilling on local roads, schools, hotels, wineries and farms. I’m a task force member from the public at large.

The task force (http://sites.google.com/site/schuylergas/home) is studying how Pennsylvania counties have dealt with hyro-fracking. It’s also discussing the best ways to divvy up tax revenues from the drillers and considering if and how to require and pay for well water tests before drilling.
Meanwhile, there are signs that the gas drilling industry’s extremely light regulatory burden may get heavier in response to overwhelming public outcry over possible contamination of scenic treasures such as Seneca Lake and well water.

For example, although the Bush Administration exempted the hydro-fracking process from federal clean water laws, a bill in Congress would repeal that exemption (known by some as the Halliburton loophole). The new legislation co-sponsored by Rep. Maurice Hinchey (D-NY) would require drillers to spell out in detail exactly what chemicals are used in the process.

And the state rules proposed by the DEC also call for the industry to cough up lists of hydro-fracking chemicals before they break ground.

But those federal and state rule changes aren’t a done deal. Expect stiff industry and Republican opposition to the Hinchey bill.

Peter Mantius is a semi-retired journalist who lives in Burdett.

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*NIMBY stands for Not In My Back Yard

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Photos in text:

Top: Peter Mantius

Bottom: A Halliburton Inc. truck makes a delivery in September at a Fortuna Energy Inc. drilling site in Troy, Pa. (Photo by Peter Mantius)