MSC to EPA: Hydraulic Fracturing is “a safe, essential part of the responsible development of natural gas”

Remarks of Kathryn Z. Klaber, Marcellus Shale Coalition president
As Prepared for Delivery

EPA Public Forum on Hydraulic Fracturing; Canonsburg, PA
July 22, 2010

My name is Kathryn Klaber, and I have the tremendous privilege of serving as the Marcellus Shale Coalition’s first president. And on behalf of the MSC – the organizational body that represents the vast majority of shale gas producers and midstream companies operating in the Commonwealth – I appreciate the opportunity to discuss the significant role hydraulic fracturing continues to play in the responsible development of clean-burning, job-creating natural gas. As the MSC said at the outset of this study in March, our industry is confident that an objective, science-driven, and peer-reviewed evaluation of fracturing will reach the same conclusions produced by a host of other studies, including most notably one issued by your agency in 2004.

In that report — the product of an intensive, four-year course of study first initiated under the Clinton administration — EPA found “no evidence” suggesting the fracturing of shallow coalbed methane reserves posed a threat to underground drinking water supplies. Certainly you’re aware that coalbed methane strata reside thousands of feet closer to the water table than shale formations, and that the technology used today to access clean-burning natural gas from these formations is much more advanced and sophisticated than what was available in the past.

Here in Pennsylvania, fracturing has been in use for more than 50 years, and has been tightly regulated by the state almost before we had a name for it. Today, as you know, fracturing is considered a safe and essential part of the responsible development of natural gas, which studies have shown has the potential to create nearly 212,000 new jobs throughout Pennsylvania over the next decade.

Because of tight regulations and laws in place, coupled with the commitment from industry to protect the environment, there’s never been a single case of groundwater contamination associated with fracturing, as noted by PA DEP, top EPA officials, other state regulators, and the Groundwater Protection Council.

As EPA’s study moves forward, it’s critical to consider what the top officials responsible for regulating fracturing in the Commonwealth have said. Scott Perry, director of DEP’s bureau of oil and gas management – with whom my members work closely with – said this in May:

• “We’ve never seen an impact to fresh groundwater directly from fracking.”
•“No one’s ever documented drinking water wells that have actually been shown to be impacted by fracking.”

Pittsburgh Congressman Mike Doyle has said that state officials have “done a great job in regulating” Marcellus Shale exploration.

Unfortunately, while perceptions remain that our industry continues to resist regulations, the truth is quite the opposite. In fact, my member companies met earlier today with top DEP officials about well-casing standards; the second of such productive meetings in just months.

Our industry is working tirelessly to ensure that fracturing is done effectively, prudently and in a way that continues to create thousands of good-paying jobs and delivers stable supplies of homegrown energy for U.S. consumers.

Once again, thank for the opportunity to speak here tonight about the critical role that hydraulic fracturing continues to play in realizing the Marcellus’s promise.

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New Study Finds Natural Gas in Marcellus Shale Region Worth 280,000 Jobs, $6 Billion in Government Revenue

Eric Wohlschlegel | 202.682.8114 | wohlschlegele@api.org

WASHINGTON, July 21, 2010—Natural gas production in the Marcellus Shale region—if developed—could create 280,000 new American jobs and add $6 billion in new tax revenues to local, state and federal governments over the next decade, a new study released today finds.

“One of the biggest opportunities to create jobs and increase America’s energy security lies within the Marcellus Shale region,” said Jack Gerard, president and CEO of the American Petroleum Institute.  “Pennsylvania, New York and West Virginia have enough natural gas to create hundreds of thousands of well-paying jobs and provide Americans with a stable, domestic energy source for generations to come.”

The study, “The Economic Impacts of the Marcellus Shale: Implications for New York, Pennsylvania, and West Virginia,” by Timothy J. Considine, Ph.D. of Natural Resource Economics, expands on a recent Pennsylvania State University study, which found similar economic benefits from developing the Marcellus region—a layer of shale rock underneath much of western Appalachia, from southern West Virginia into southwestern, central, and northeastern Pennsylvania, and the southern tier of upstate New York.

Natural gas production in the Marcellus grew considerably during 2009 adding 57,000 new jobs mostly in Pennsylvania and West Virginia. “This new analysis predicts that many tens of thousands of more jobs could be created in the coming years if public policies do not drastically limit production,” said Considine. “Under the best scenarios the development of Marcellus could mean $24 billion in total economic value to the region, which would positively impact all sectors of the economy including the service industry, construction, manufacturing, health care, and education.”

The study also examines factors that could limit the benefits of natural gas development in the region, including: a possible severance tax in Pennsylvania; the current de facto moratorium on horizontal drilling in New York, estimated at $11 billion dollar in lost economic output; and the effects of a challenging tax and regulatory climate in West Virginia.

“Maintaining production growth is like running on a treadmill. Slowing down drilling and production would negatively impact employment and economic growth. If governments pursue policies that encourage the development of natural gas, the ultimate benefits to the economy, the tax base, and society would be significant,” said Considine.

The study finds that natural gas development stimulates the economy through business-to-business spending and via payments to land owners. The process involves exploration, drilling, building gas processing plants, and pipeline construction. These activities require goods and services from many sectors of the economy, including construction, transportation, iron and steel, and engineering services. Natural gas companies also pay lease and royalty payments to land owners, who in turn pay taxes and spend income on goods and services.

For complete text of the survey and more information – including survey methodology – please go to: The Economic Impacts of the Marcellus Shale: Implications for New York, Pennsylvania, and West Virginia

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Natural Gas Opponents Continue to Mislead the Public

Editor’s Note: The flowing is attributable to Brad Gill, executive director of the Independent Oil & Gas Association of New York, in response to today’s news conference outside the Senate chamber.

“Today’s news conference to support proposed moratorium legislation is another example of the reckless disregard for the facts that ill-informed and dishonest opponents continue to put forth as they attempt to block the safe exploration of natural gas and economic recovery in New York.

New York is already under a two-plus year moratorium to explore the Marcellus Shale. Another moratorium is simply unnecessary, and would be an example of shortsightedness in an election year. The Department of Environmental Conservation will not issue a permit to drill until it completes the Supplemental Generic Environmental Impact Statement. It should be allowed to continue its work and publish its findings without unnecessary interference by environmental groups attempting to create fear. 

When I speak to business groups, struggling landowners, economic development professionals, and especially the scientists and geologists and operators who understand the technologies involved in extracting natural gas, it is absolutely clear that we can harvest this abundant natural resource safely and efficiently, benefiting our communities and our state.”

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Legislative Postcard – I Love Natural Gas

Check out our latest postcard advocating for safe natural gas exploration in New York that is being sent to the New York State Legislature.

I Love Natural Gas

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Press Release: New Yorkers Who Support Safe Natural Gas Exploration Appeal to Legislature in Droves

6/25/10 – New Yorkers have sent nearly 12,000 e-mail messages to state lawmakers in the past month, strongly urging them to oppose two bills that would impose moratoriums on natural gas extraction in the state.

One bill sponsored by Sen. Antoine Thompson (D-Buffalo) and Assemblyman Robert Sweeney (D-Lindenhuurst) would place an immediate one-year moratorium on new natural gas drilling permits in New York. Another by Assemblyman Steven Englebright (D-Setauket) and Senator Joseph Addabbo (D-Howard Beach) would halt natural gas exploration using hydraulic fracturing until completion of a study by the U.S. Environmental Protection Agency (EPA). 

Through an electronic letter-writing campaign sponsored by IOGA of NY, residents have sent a strong message to the Legislature that a moratorium is not necessary. These bills are being considered as the state Department of Environmental Conservation (DEC) is revising regulations for natural gas exploration in the Marcellus Shale. The agency’s final report is expected in late summer or early fall.

“New Yorkers sent almost 12,000 messages in a month. That is an outstanding accomplishment and a strong message that the DEC’s work over the past two years should not be blocked by a moratorium,” said Brad Gill, IOGA of NY executive director. “DEC must be allowed to do its job. Then we must allow New Yorkers – and New York State – to reap the benefits that safe natural gas development will bring.” 

The e-mail message stated, “These bills would further delay the greatest economic development opportunity that New York and its residents have seen in a generation, and would stifle economic recovery and vitality throughout the Southern Tier and across our state. In short, thousands of jobs and billions of dollars in economic impact are at stake.”

Expanded natural gas exploration will produce efficient, abundant and environmentally clean fuel and increase New York’s energy independence. It will also create thousands of jobs. The economic impact of just 300 Marcellus Shale wells is estimated to exceed $1.4 billion, with $108 million going to landowners, $19 million to municipal taxes, $32 million to state coffers and thousands of new jobs.

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