Daniel Rubin: Hard to extract consensus on natural gas
By Daniel Rubin
Philadelphia Inquirer Columnist
On Saturday, a perfect day for exercising the couch, I spent a few hours with some whip-smart ladies in sensible shoes. The League of Women Voters sponsored a conference on the promise and potential peril buried within the Marcellus Shale. Here was an opportunity to unearth a few facts about natural gas in a hysteria-free setting.
The 380-million-year-old rock formation, which runs from New York to West Virginia, is in the news. Gov. Rendell eyed taxing the riches being extracted from land underneath Pennsylvania forests. While the House agreed, the Senate balked, even though the state is likely sitting on a gassy mother lode.
In January 2008, researchers announced that new drilling techniques suggested the presence of enough natural gas to supply the entire nation for two years. The rush was on.
In August, results from preliminary drilling led one of the authors of that study, Pennsylvania State University geologist Terry Engelder, to be even more optimistic: The natural gas in the formation, he figured, is the equivalent of four times the amount of U.S. oil reserves.
“The Saudi Arabia of natural gas” is how Jan Jarrett, president of PennFuture, puts it. PennFuture turned up at the League of Women Voters conference. The advocacy group is concerned with the environmental impact that would accompany a gas rush. So is the Delaware Riverkeeper Network. On the other side of the conversation is Stephen Rhoads, the chief lobbyist for the state’s oil and gas industry.
Rhoads is a man you can do business with. He makes no apologies, answers his own phone, and doesn’t call a spade a garden implement. He offered useful perspective.
Gas, he said, will provide a mere bridge until other sources of energy are found, but it’s a big bridge. If forecasts prove to be true, companies will be pulling gas out of the rock for the next century.
And there should be plenty of money flowing aboveground. The industry estimates that by 2020 it will have made a capital investment of $13.5 billion, which converts into $1.4 billion in state and local taxes. (A report this week by the Pennsylvania Budget and Policy Center called those figures an exaggeration – about double what the nonpartisan group estimated.)
Rhoads said gas would provide jobs for 174,000 people, jobs paying an average of $60,000, in counties that are desperate for good incomes.
While he predicted the legislature would refrain from taxing the gas extraction this year, he said tax revenue would have done little to fix the state’s budget problems.
Such a tax would not have raised the $120 million a year that some activists have quoted, Rhoads said. It would be more like $26 million, considering that only 329 wells are in place. Given the magnitude of the state’s needs, that figure, he said, is “equivalent to a rounding error.”
Engelder said the biggest environmental concern involved water management. Sand and chemicals are mixed with high-pressure water that is shot deep down into the rock to free pockets of gas. What happens to this water afterward?
The industry and academia are studying how to remove the salt and chemicals from the wastewater or how to bury it deep in underground wells.
“Let me emphasize that this isn’t easy,” Engelder said afterward. “The cleanup is expensive.”
Tracy Carluccio, deputy director of the Delaware Riverkeeper Network, voiced concern that state law contains no requirement to study the environmental impact of so much drilling. And the gas industry was persuasive enough to be exempted from the transparency of the Safe Drinking Water Act.
As a result, the public doesn’t have a right to know what is in the chemicals being used to extract and recover the gas.
And with 18 million people dependent on the Delaware River watershed, that, she said, is dangerous.
At the end of the session all speakers agreed on one need: This is a time to expand the Department of Environmental Protection, not cut its budget by 30 percent, as the state Senate would do, because in a mad rush, someone’s got to make sure no one gets trampled.
Contact Daniel Rubin at 215-854-5917 or email@example.com