Posts Tagged ‘Hughesville’

Saying plan likely will be revived in 2010, Rendell adds that he wants industry to get off to a good start.

AMY WORDEN and MARIO F. CATTABIANI The Philadelphia Inquirer

HARRISBURG – Gov. Rendell said Monday after meeting with industry officials that he would agree to delay his push to impose a tax on natural gas extracted from the Marcellus Shale.

“It won’t be in the mix this year,” he said, adding that he would likely revive the proposal next year. “We felt we should let the industry get off to a good start, and that surpasses our need for money.”

For months, Rendell had lobbied for the tax on the gas-rich Marcellus Shale reserve. At one point, the administration estimated it could produce $100 million in revenue in the first year.

But the Democratic governor said on Monday that he reconsidered the idea after watching natural gas prices plummet to near-record lows and meeting with industry representatives who have invested millions to explore the natural gas reserve hundreds of feet beneath the ground.

The Marcellus Shale is a vein of rock containing vast reserves, running hundreds of feet below ground from New York to Virginia. Its exploration and extraction – estimated to be worth billions – has been made possible in recent years by advances in technology.

Senate Majority Leader Dominic Pileggi, R- Delaware County, said it was no surprise that Rendell had abandoned the effort, noting that taxing an industry in its infancy was an unpopular move even among some members of Rendell’s own party.

“The governor has recognized the realities of the situation,” Pileggi said.

Although Rendell said he was no longer interested in the tax this year, Democrats who control the state House said it remained among the mix of possible revenue sources.

“It is definitely not off the table,” said Johnna A. Pro, press secretary to House Appropriations Chairman Dwight Evans, D-Philadelphia.

Other so-called niche taxes still on the table include higher cigarette taxes and a new levy on smokeless tobacco. Also under consideration is the elimination of a slew of long-standing sales-tax exemptions on such items as candy and gum, land-based phones, and basic cable. Rendell has said the removal of exemptions on all items except food and clothing and certain services could generate $1 billion.

Copyright: Times Leader

Agency said Susquehanna River has enough water, but withdrawal timing is key.

WILLIAMSPORT – The Susquehanna River watershed has enough water to supply drilling for natural gas in the Marcellus Shale, members of the Susquehanna River Basin Commission assured at a public hearing on Tuesday.

The trick is to take it when there’s a lot available, and that requires planning.

“It’s not so much the consumptive use,” said Thomas Beauduy, the SRBC’s deputy director.

“It’s when it’s being used. It’s how it’s being used.”

To illustrate the point, Michael Brownell, the commission’s Water Resources Management Division chief, used a local drilling site owned by Chief Oil & Gas LLC as an example.

The site, tucked along rolling ridges east of Hughesville, is permitted for water withdrawal from a creek almost six miles away, meaning the water must be trucked. Water could probably be piped in from a smaller creek about half a mile away, but only in certain seasons when its flow is high enough, Brownell said, which would require forethought.

It’s a matter of submitting the application early, doing the research and picking the right time, he said.

Water use is a major factor for drilling in the shale about a mile underground.

Companies use an innovative horizontal drilling and hydraulic fracturing process that’s succeeded in similar gas-containing formations in Texas. Each fracturing process can use as much as four million gallons of water. Only about half of that is recovered, Beauduy said.

And while the commission is interested in recycling and reusing water, he acknowledged that every use is assumed to be a complete loss of the water from the watershed so that any recovery is seen as a bonus.

That said, both SRBC representatives noted that, in the aggregate, water withdrawal for well drilling would equal perhaps 28 million gallons per day, which is about half as much as PPL Corp.’s nuclear Susquehanna Steam Electric Station in Salem Township.

The hearing, which was meant to discuss proposed SRBC regulation changes, brought out concerns from both the industry and residents.

Potter County Commissioner Paul Heimel, who was representing the County Commissioners Association of Pennsylvania, noted two concerns.

First, that the chemicals used in the fracturing process haven’t been identified, and second, that it was unclear if the industry would be allowed to withdraw water during drought conditions.

Scott Blauvelt of East Resources, Inc. represented the Marcellus Shale Committee, which is made up of 28 members of regional gas and oil associations.

Copyright: Times Leader