NY Comptroller DiNapoli Editorial Defends Drilling Tax

Thomas DiNapoliLast week, New York State Comptroller Thomas P. DiNapoli made a pitch for taxing the gas drilling industry in New York to create a pool of money that can be used to clean up accidents that may occur. As MDN pointed out (see MDN story here), any pool of money that sits in Albany doesn’t last long and will certainly be reallocated for other unintended uses. In addition, wouldn’t you make the company who caused the accident pay to clean it up? Why extort extract money ahead of time from all drillers, even from those who will never experience an accident, for an accident fund? Why? Because politicians love money, that’s why.

Apparently DiNapoli is feeling push-back against his brilliant proposal, and has found it necessary to write an editorial, sent to multiple news outlets across the state, to defend the indefensible: yet another new tax. Here is DiNapoli’s editorial, in full:

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Ultra Petroleum Marcellus Production in PA Jumps 321%

Ultra Petroleum, an independent energy company headquartered in Houston, TX, reports a major ramp-up in Marcellus Shale gas drilling and production for the second quarter of 2011. Ultra says their Marcellus net production increased 321 percent over the second quarter of 2010. Since Ultra started drilling in the Marcellus Shale in 2009, they have drilled 235 gas wells in Pennsylvania’s Marcellus Shale. All of Ultra’s Marcellus drilling (so far) has been in PA.

Ultra’s PA Marcellus operational update (from their quarterly report):

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Ohio County Receives $8M (So Far) from Marcellus Gas Leases

Ohio County, WV is reaping the rewards of leasing county-owned land for Marcellus gas drilling. The county’s land leases with Chesapeake Energy have already resulted in nearly $8 million in one-time lease payments for the county coffers, and soon will mean royalty payments too. Chesapeake has already completed a well on private land adjacent to (and drilling under) county land in The Highlands area. But gas from that well has not yet started to flow due to a delay in getting a pipeline built to the well. Once the pipeline is in place, the county will start receiving royalty checks from that well.

And within the next 12 months, Chesapeake will drill a new well, this time directly on county-owned land at the airport:

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Common Cause/NY Says Delay Gas Drilling Another 6 Months

Common Cause/NY, a far-left organization, is the latest anti-drilling group desperately seeking a way to stop Marcellus and Utica drilling in New York State. Their tactic? Turn the already-generous 60-day public comment period (that hasn’t even started yet!) on proposed new drilling rules into 180 days—that is, let’s stretch out the comment period from two months to six months to give everyone who opposes drilling a chance to bleat and moan before local news cameras for the next six months on the off chance we can turn a few more people against this thing and finally kill it. That’s the so-called “non-partisan” approach of Common Cause.

From their press release:

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Morgantown Official Backpedals After Drilling Ban Overturned

It’s always interesting to watch politicians operate after a humiliating defeat. Politicians’ DNA does not allow them to simply look inward and recognize their own errors. They always look outward and blame others, or in some cases, declare the defeat was a good thing and accomplished just what they wanted all along! I refer to the situation in Morgantown, WV. In June, Morgantown City Council members voted to ban hydraulic fracturing both inside and up to one mile outside their borders (see this MDN story). This threatened a pair of Marcellus Shale wells being drilled about a mile from city lines. The result? The driller, Northeast Energy, sued the city. Last week a judge overturned the city’s ban and now hydraulic fracturing will commence (see this MDN story). All told, Northeast probably lost about a month out of their original drilling schedule (they continued drilling anyway, the ban specifically prohibited fracking and not drilling per se).

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