“Marcellus Shale” has been in the news a lot lately. But it’s not the name of a leading man in a movie, or a character in a comic book. Marcellus Shale is in fact a huge rock formation stretching across six states, including Pennsylvania.
And it’s at the heart of a new Gold Rush, because inside that rock is locked billions of dollars-worth of natural gas, the clean-burning alternative to the coal that powers the industrial world.
Energy companies from across the globe are racing to get a piece of the action inside Pennsylvania’s humble layers of rock. Cash-strapped governments are eagerly eying the tax revenue that come with the drilling, political candidates are jostling to promise to tax the gas drilling the most (or the least), and the state’s unemployed are counting on drilling jobs.
But environmentalists are crying foul, worried that chemicals used in drilling for the gas will leak into drinking water supplies even hundreds of miles from the shale fields.
Confused? We don’t blame you. We are here to tell you what’s going on in the Marcellus Shale and why it all matters to your life here in Philadelphia.
- Sept. 29, 2010
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What is the “Marcellus Shale” anyway?
It’s a huge field of dark, slightly crumbly rock you see all over Pennsylvania and central New York, deposited by an ancient ocean almost 400 million years ago. It’s named for a big outcropping of shale near the town of Marcellus, New York. About two-thirds of Pennsylvania lies on top of this rock formation.
Why are we talking about this now?
For a long time, people thought the shale was pretty much worthless because it doesn’t contain any usable coal and the natural gas locked inside it was too difficult and expensive to extract. The rising demand for energy and some advances in drilling, however, mean companies finally think it’s worth their effort to drill for the gas, which is trapped in pockets in the rock.
How big is this drilling industry anyway?
In 2005, only four wells were drilled in the entire state of Pennsylvania. This year, several dozen of the worlds’ largest energy producers will break ground on an estimated 2,700 new wells. Companies including Exxon, Royal Dutch Shell, and Norwegian energy giant StatoilHydro have paid billions to acquire companies with leases to drill in the state.
Why are environmentalists upset?
Because getting that gas involves opening the gaps and cracks in the rock wider and wider to let the gas flow out. Doing this is known as “hydraulic fracturing,” or “fracking,” in which the drillers force water, sand, and industrial chemicals down the well to break up the rock. That contaminated “frac water” is supposed to be pumped back out and cleaned up, but environmentalists point to cases where the toxic chemicals flowed through the cracks in the rock and into nearby wells and streams.
Who’s supposed to be cleaning up after the drilling?
The drilling companies are responsible for cleaning up the frac water and taking care of any accidental spills. The state Department of Environmental Protection has a generally good reputation for regulating and monitoring the drilling companies. It recorded about 1,500 incidents of contamination over the last two years.
Is Philadelphia’s water in any danger?
This is a big question. About 60 percent of the city’s water comes from areas in northeastern Pennsylvania where drillers are looking for gas. Any contamination could reach the Delaware River, which provides drinking water and flows right past Philadelphia. New York was so worried about contamination of its own drinking water that it put a halt to all drilling until May of next year while it studies the matter.
Is anyone trying to protect Philadelphia’s water?
The City Council is holding hearings to learn whether drilling is a threat and the city water authority says it is watching the issue. The Delaware River Basin Commission, an interstate agency that controls water use in the river, has ordered a halt to drilling near the river while it studies the effect of fracking, though there is no sign the state government will call a halt.
If there is a risk of contamination, why would the state permit the drilling at all?
Drilling companies say the drilling is safe and is vitally necessary to supply the nation with clean energy. State legislators say Pennsylvania needs the jobs. The industry has brought up to 10,000 out-of-state workers to Pennsylvania and both candidates for governor are floating plans to train more Pennsylvanians to work in the industry and to encourage the drillers to hire them.
You said something about taxes earlier?
Yes, and that’s where the politics of this get interesting. Pennsylvania is the only large natural gas-producing state that doesn’t charge what’s called an “extraction tax.” Gov. Rendell is pushing for a tax to cover the cost of monitoring the drilling and to help balance the state’s chronically short budget, raising perhaps as much as $200 million. He and the legislature are pushing to get an agreement on the tax by the end of this week, Oct. 1.
That sounds like a no-brainer. Why hasn’t the legislature passed a tax?
There’s actually lots of disagreement about it. Republicans argue that Rendell’s tax is too high and might cripple the fledgling industry. They favor either no tax or phasing it in slowly to let the business build. There is also wide disagreement as to what to do with the tax money. Some people want to use it for environmental cleanup. Some people want to give it to towns and counties to help lower property taxes. Others want to give it to schools or road projects.
Why the rush to get it passed by Oct. 1?
That was a part of the deal lawmakers and the governor made to pass a budget for 2011 earlier this year. But really, it’s all about politics: there’s an election coming up to choose a new governor (Rendell can’t run again), and the severance tax issue is getting tied up in that battle.
Why does it matter that there’s an election going on?
If the tax isn’t in place by the time Rendell leaves office in January, the new governor will decide whether there will be a tax or not and how large it will be. Republican Tom Corbett has signed a “no new tax” pledge, so supporters of the tax worry he will refuse to sign a severance tax on drillers. Democrat Dan Onorato says he supports a tax on drillers.
Are the energy companies getting involved with the election?
With so much money at stake, it would be a surprise if they didn’t. They have given large campaign contributions to both Democratic and Republican elected officials in Pennsylvania over the past decade, which has worried drilling opponents. Common Cause, a national government ethics group with an office in Pennsylvania, has set up a website to compile statistics on contributions from energy companies to candidates:
www.marcellusmoney.orgHow do landowners feel about having wells on their property?
Depends who you talk to. Many landowners in rural Pennsylvania have seen a huge benefit as they lease their land to gas drillers – prices have reached thousands of dollars per acre – and businesses that serve the drilling companies are glad for the extra revenue in the bad economy. But some landowners complain they are being pressured to open their property to gas drillers despite the risk of contamination to water and damage to their fields and forests.
Is there any way to limit the effects of drilling on the environment?
The gas companies are required to restore the land after they are done drilling, and they are responsible for cleaning up any contaminated water, though not everyone agrees how well they do on either. Some lawmakers of Western Pennsylvania are pushing legislation that would allow gas companies to build a single cooperative well in one area rather than a whole bunch of little wells scattered around the landscape. That’s called “pooling.”
Why would pooling help?
It would save costs, limit the number of wells, and limit the area where heavy equipment would be working and trucks would be driving, which damages land and adds wear and tear on public roads. Some landowners worry, however, that the legislation would force them to give up the rights to the natural gas under their land, since a large communal well would draw gas from a much wider area.
Where can I learn more about natural gas drilling in the Marcellus Shale?
DEP has information about what companies are extracting gas from the Marcellus Shale:
http://www.dep.state.pa.us/dep/deputate/minres/oilgas/OGRE_Production/ogreproduction.htmAnd more about state laws to protect drinking water and the natural environment:
http://www.dep.state.pa.us/dep/deputate/minres/oilgas/new_forms/marcellus/marcellus.htm
How can I let my elected officials know what I think?
Visit the
Committee of Seventy's Online Citizen's Guide to find the address and phone number of your State Representative, State Senator, or Governor.
How can I find out more about what candidates are saying?
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And
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This is the second in a series of issue-oriented “In the Know” pieces developed for “Election 2010,” a joint project of Philly.com and The Committee of Seventy. We welcome your thoughts on this or any other “In the Know” project at info@seventy.org.