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    A Balanced View of Waste Water Treatment from Marcellus Shale Drilling

    Towanda Daily Review (Nov 18):
    Treatment plant for gas drilling waste water subject of Athens Twp. hearing tonight

    An informative article about the waste water treatment plants proposed for northeastern Pennsylvania. Some tidbits from the article:

    The North Central Regional Office of the DEP, which serves Bradford, Cameron, Centre, Clearfield, Clinton, Columbia, Lycoming, Montour, Northumberland, Potter, Snyder, Sullivan, Tioga, and Union counties, has received 10 applications for NPDES permits, according to spokesman Dan Spadoni. Of those 10 applications, four are for plants proposed on the west branch of the Susquehanna River, one is for the Somerset plant on the Chemung River, one is proposed on the Tioga River, and the remainder are for various creeks and streams, he said.

    Somerset Regional Water Resources is requesting a discharge permit for around a million gallons a day, which makes it the largest in the North Central Region, Spadoni said. The other proposed plants are requesting permits for between 50,000 to 500,000 gallons per day, he said.

    The article discusses naturally occuring radioactive substances that might be concentrated in waste water, and how the plants would deal with it. The article also points out the plan is for the plants to recycle and re-use most of the water for other shale drilling instead of discharging it all into the environment. However, there will necessarily be some water discharged into tributaries and streams.

    I found this article very enlightening and balanced in its coverage–a good read for landowners and other interested parties.

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    Pennsylvania Offers 32,000 Acres of State Land for Drilling Leases

    Wellsboro Gazette (Nov 18):
    Marcellus Shale, climate change, money, politics and the environment

    Pennsylvania is offering state-owned land for lease to energy companies interested in drilling in the Marcellus Shale. According to the article:

    Monday, the secretary of the Department of Conservation and Natural Resources (DCNR), John Quigley, announced that six tracts of land are being offered for lease. The lease offering amounts to 31,967 acres.

    Nearly 22,000 of the acres for lease lie in Tioga and Potter counties.

    The 31,967 acres represents 1.5% of the total amount of state-owned forest land, a very small fraction.

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    Waste Water Treatment Plants the Next Battleground in the Drilling Debate

    Harrisburg Patriot-News (Nov 18):
    Twelve Marcellus Shale gas drilling wastewater treatment plants proposed in northern Pennsylvania

    Water treatment plants are the next battleground in the drilling debate. There is increasing opposition to the licensing of treatment plants, not only because of the chemicals used, but the truck traffic involved. From this article out of Harrisburg:

    The state Department of Environmental Protection is reviewing permit applications associated with at least 12 different proposals to build treatment plants for chemical-tainted wastewater from natural gas drilling operations in northern Pennsylvania.

    Ten of the plants are proposed in DEP’s 14-county north-central region, which is centered on Lycoming and Clinton counties.

    Also from this article, a few stats of interest:

    Through October, 120 of the 1,592 Marcellus Shale well drilling permits issued by DEP this year were for sites in Susquehanna County.

    And this:

    DEP issued 1,592 Marcellus Shale gas well drilling permits in the first 10 months of 2009. More than one-third of them were in the 14-county north-central region.

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    Sustainable Tompkins Takes Aim at Drilling in the Marcellus Shale

    Ithaca Journal (Nov 18):
    Sustainable Tompkins awards mini-grants

    People in the Ithaca, NY area should know that a local organization calling itself Sustainable Tompkins (www.sustainabletompkins.org) is helping to fund anti-drilling causes. They recently made a small grant of $370 to Shaleshock Citizens Action Alliance (www.shaleshock.org) to “produce newsletters reporting on industrial gas drilling in the Marcellus Shale and its effects on the Finger Lakes region.” That is, to fund the false and misleading propaganda that Shaleshock excretes. Unfortunately, New York State taxpayer money is one of the funding sources for Sustainable Tompkins. As a taxpayer in New York, I OBJECT. When will our politicians wise up and quit wasting money on these leftist organizations? Shame on Assemblywoman Lifton for securing funding for Sustainable Tompkins as a “member item” in the (soon to be bankrupt) New York State budget.

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    Cabot Oil & Gas Fined $120K over Gas-Contaminated Wells in Susquehanna County

    PA Department of Environmental Protection (Nov 4):
    Press Release: DEP Reaches Agreement with Cabot to Prevent Gas Migration, Restore Water Supplies in Dimock Township

    Below is the unaltered press release from the PA DEP:

    Meadville – The Department of Environmental Protection and Cabot Oil and Gas Corp. have executed a consent order and agreement that will provide a long-term solution for migrating gas that has affected 13 water supplies in Dimock Township, Susquehanna County.

    The affected area covers nine square miles around Carter Road.

    The consent order and agreement outlines a process that will give DEP more oversight of Cabot’s new well construction work in the affected area. Prior to drilling and hydraulic fracturing, or hydro fracking, the company will submit well casing and cementing plans to DEP. Once DEP provides written approval, Cabot may proceed.

    “The goal of the consent order and agreement is to ensure a long-term resolution to issues that have emerged in Dimock,” said DEP Northwest Regional Director Kelly Burch. “The company will focus on the integrity of the wells in the affected area in an attempt to determine the source of the migrating gas.”

    This past week, Cabot has provided an interim solution for all of the homes where water supplies have been affected. Cabot must develop a plan by March 31 to restore or replace the affected water supplies permanently.

    Under the consent order and agreement, Cabot must additionally submit to DEP:

    • Information on all parties who have contacted the company about water quantity or quality issues; and
    • A plan that specifically identifies how the company intends to prove the integrity of the casing and cementing on existing wells and fix defective casing and cementing by March 31.

    If Cabot fails to fix the defective casing and cementing by the March deadline, the company must plug defective wells or implement another alternative as approved by DEP.

    In addition, Cabot paid a $120,000 civil penalty for violations of the Oil and Gas Act, the Solid Waste Management Act and the Clean Streams Law.

    The consent order and agreement caps a DEP investigation that began early this year when numerous Dimock area residents reported evidence of natural gas in their water supplies. DEP inspectors discovered that the well casings on some of Cabot’s natural gas wells were cemented improperly or insufficiently, allowing natural gas to migrate to groundwater.

    On Sept. 25, following a series of wastewater spills, DEP ordered Cabot to cease hydro fracking natural gas wells throughout Susquehanna County. The prohibition was removed after the company completed a number of important engineering and safety tasks.

    Cabot Oil and Gas Corp. is a Delaware-based company with a mailing address in Pittsburgh.

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    NY DEC Extends Comment Period on New Regulations by 30 Days

    Binghamton Press & Sun-Bulletin (Nov 4):
    Debate on drilling rules extended by DEC

    The New York Department of Environmental Conservation has caved to the anti-drillers who are screaming for more time to read the 800-page draft Supplemental Generic Environmental Impact Statement (dSGEIS)–the proposed new drilling regulations all drillers in New York would have to follow when drilling in the Marcellus Shale. So the DEC has added another 30 days to the “comment period” which is really nothing more than an extra 30 days for the anti-drillers to try and prevent drilling in New York. No worries, drilling is coming and they can’t stop it.

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    Feds Deny Private Landowers the Right to Drill in PA

    Kangaroo News Service (Nov 2):
    Local Citizens, Civic and Business Leaders Launch Petition to Resume Oil and Gas Development in the Allegheny National Forest

    This one should make every landowner shudder–with anger and fear. The Obama Administration has illegally shut down drilling on private land in Pennsylvania. Landowners who own land in the Allegheny National Forest are now denied access to drill and sell the natural gas under their own land by fiat from the U.S. Forest Service, part of the executive branch of the federal government (i.e., Obama). This naked and forceful grab of individuals’ rights by the federal government cannot go unanswered. Make your voices heard!!

    We have to go all the way to an Australian news service for this one folks:

    In a petition distributed by the Pennsylvania Oil & Gas Association (POGAM) and Allegheny Forest Alliance (AFA), nearly 2,000 citizens, and civic and business leaders from Elk, Forest, Warren and McKean counties have called for President Obama and the U.S. Department of Agriculture to lift a ban on oil and gas development by the U.S. Forest Service, which effectively has halted drilling on privately owned mineral lands underlying the Allegheny National Forest. The petition was also mailed to Pennsylvania Governor Ed Rendell to encourage a greater effort by the Commonwealth to support a critical element of northwestern Pennsylvania’s economy.

    In a historically unprecedented action, local and regional managers of the Allegheny National Forest have banned oil and natural gas exploration and barred mineral owners from accessing their property throughout the forest, effectively seizing the development rights to privately owned oil, gas and mineral resources. The ban has shut down oil and natural gas exploration and stymied production in the forest, where the industry has operated for decades in cooperation with the U.S. government. The petition maintains that the ban illegally violates Pennsylvania’s grant of consent to the United States in 1921 to acquire the forest and also violates the protection of private property rights in the federal law, the Weeks Act of 1911, under which it was acquired.

    “The behavior by the Forest Service is most irresponsible, and it amounts to the unlawful taking of private property,” said Stephen W. Rhoads, POGAM president. “State records show that fewer than 50 wells, all of them permitted prior to the drilling ban imposed on January 1, have been drilled in the Allegheny National Forest during 2009. The Forest Service has prevented the drilling of between 200-300 wells that would have otherwise occurred. These undrilled wells translate into private investment of nearly $100 million and jeopardize hundreds of good-paying jobs in the region. The action of the Forest Service amounts to a full-scale assault on the economic health of the families and communities living in and around the Allegheny National Forest.”

    Private oil and gas development within the Allegheny National Forest accounts for at least 20 percent of Pennsylvania’s oil production and as much as 10 percent of Pennsylvania’s natural gas production. It contributes tens of millions of dollars annually into the regional economy of northwest Pennsylvania and western New York.

    For decades, the U.S. Forest Service and the oil and natural gas industry have worked cooperatively to manage oil and gas development. The petition represents a strong consensus among citizens and local community leaders about the importance of this industry and the condemnation of the Forest Services’ current management practices to immobilize the region’s economic recovery and progress.

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    St. Mary Completes First Two Wells in McKean County, PA

    St. Mary Land & Exploration (Nov 2):
    St. Mary Provides Operational Update; Updates Performance Guidances for 2009

    From a press release from St. Mary Land & Exploration, a drilling company headquartered in Denver, CO:

    St. Mary has drilled and completed its first two horizontal wells in this program. The wells are the Potato Creek 1H and the Potato Creek 3H (both SM 70% WI). These wells are located in McKean County, Pennsylvania. The Company is currently laying a temporary sales pipeline to test the first well. As a reminder, St. Mary has a total acreage position of approximately 41,000 net acres in McKean and Potter Counties in north central Pennsylvania.

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    Six Regulators Police Drilling in Eastern Half of PA

    Wayne Independent (Nov 2):
    Few regulators in place for natural-gas drilling

    At a recent meeting in Preston Township (Pennsylvania), Department of Environmental Protection (DEP) officials talked about their role in inspecting gas drilling operations in the Marcellus Shale. The article attempts to make the case there are far too few inspectors for the growing number of drilling locations. In the eastern half of Pennslvania there are only six DEP officers whose job it is to monitor drilling activity and water supplies. The DEP is requesting three more, but with the recent state budget cuts, the additional positions are not assured.

    There was one bit of interesting information for landowners in Wayne and surrounding counties in the article:

    Although Wayne County has had only two natural gas wells drilled in the past two years, other areas in the region have experienced a rapid proliferation of production sites including in Susquehanna, Bradford, and Tioga counties. Hundreds of drill sites are expected to come online by the end of next year in the eastern office’s jurisdiction.

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    Talisman Energy Expanding in Pennsylvania

    Talisman Energy (Nov 3):
    Press Release: Talisman Energy Reports $838 Million Cash Flow in Third Quarter

    Talisman Energy, an oil and gas drilling company headquartered in Calgary, Alerta (Canada), reports the following in a recent press release:

    The Company has added over 170,000 net acres of high quality land in the Pennsylvania Marcellus and Montney shale plays, investing approximately $570 million, the majority of it subsequent to September 30.

    Production from the Pennsylvania Marcellus shale play was over 50 mmcf/d [million cubic feet per day] at the end of October. A total of 31 gross wells have been drilled year-to-date and a third rig has been added, with plans to move to six rigs by year end.

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    Drilling Permits are “Flying Out the Door” in PA

    Philadelphia Inquirer (Nov 2):
    Editorial: Shale game

    In an editorial, the Philly Inquirer revisits drilling in the Marcellus Shale in Pennsylvania. The editorial is mostly a rehash of old information and the theme is, “New York’s recently proposed drilling regulations are more strict than Pennsylvania’s, we need to get more strict too.”

    But, they also include this bit of detail that’s useful for landowners in PA to know:

    Drilling permits are flying out of DEP’s doors. Through Sept. 30, 1,340 Marcellus permits were issued and 385 wells drilled – more than double the number from last year. And the just-completed state budget requires the Department of Conservation and Natural Resources to raise $60 million by leasing up to 10,000 more acres of public forest land to drillers in the next year, a goal driven by a revenue grab rather than environmental stewardship.

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    New Energy Company in the Marcellus Shale – PDC Mountaineer

    Reuters (Nov 1):
    Press Release: Petroleum Development Corporation Announces an Appalachian Joint Venture with Lime Rock Partners to Develop the Marcellus Shale Play

    There’s a new drilling company entering the Marcellus Shale region by the name of PDC Mountaineer, LLC. The new company is a joint venture between Petroleum Development Corporation and Lime Rock Partners. Petroleum Development is putting up leased acreage and other assets, and Lime Rock is pumping in cash.

    Read the press release for full details. The purpose of this notice is to let you know there’s a “new” player in town, just in case they come knocking on your door.

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    Millionaire Landowners – In New York State?!

    Crain’s New York Business (Nov 1):
    The new gold rush

    With heavy dollops of anti-drilling sentiment (so the reporter keeps his job), this article is worth a read because of the fountain of good information about economics for landowners in the Marcellus Shale. The theme that runs through it is the story of a truck driver with 120 acres outside of Binghamton, NY who stands to become a millionaire many times over if and when drilling starts to take place in New York. The truck driver, Jeff Decker, is not allowed to divulge the terms of his upcoming lease, but it’s thought to be in the neighborhood of $700,000–and that’s just the signing bonus for his 120 acres. If they drill on his property and he gets, oh say a 20% royalty, he’s easily into millions of dollars.

    This nugget of useful detail from the article:

    An 80-acre swath of the Marcellus can eventually produce $42 million worth of natural gas, says Dean Lowry, president of Fort Worth, Texas-based Llama Horizontal Drilling Technologies. With drilling leases now giving landowners 20% royalties on productive wells, Mr. Decker could become a millionaire several times over.

    Drillers, whose cost to develop an 80-acre parcel is about $4 million, would also prosper. “Fifty percent of the gas could be extracted in the first three or four years,” Mr. Lowry says. “You get your investment back in the first year to 18 months. Then you get seven to nine times your money over the next 20 to 25 years.”

    I would also caution about what’s coming in the way of taxes when drilling finally does start in New York. This rather sobering paragraph from the article:

    In New York the Paterson administration, heeding the cries of landowners and local officials in economically depressed upstate communities, has issued draft regulations to allow it here. Landowners are keen to lease their property. Cash-strapped municipalities are eager to tax the extracted gas. Business groups say drilling would bring jobs and jolt local economies. The state would collect more income tax and, if it imposes one, a tax on gas production.

    You can expect local municipalities to not be able to resist putting their hands into landowners’ pockets to relieve them of some of their new found money. And New York State will undoubtedly not be able to resist either. Politicians are like drug addicts who need an economic “fix”. Just a warning so you’re not surprised when it happens.

    We also have the obligatory couple of paragraphs on “don’t you dare drill in the Catskill watershed” for fears of contaminating New York City’s water supply. The stated reason is this:

    New York is one of five big cities not required by the federal government to filter its water, and revocation of that waiver would necessitate a filtration plant costing $10 billion to $20 billion.

    It seems Crain’s New York Business is a bit behind the eight ball. Chesapeake Energy, the only leaseholder with land in the Catskill watershed, has already said they won’t drill there. Makes no difference, this particular political issue is just too juicy to not use–even if it’s no longer an issue.

    We learn from this article that Hess is New York’s largest energy company, and that Chesapeake Energy and Fortuna Energy are the most active leasing companies (so far) in the Marcellus Shale in New York.

    Overall, some good info in this article, but as always with mainstream media, be sure to read between the lines.

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    Vestal Landowner Group Shops for a Drilling Contract

    Binghamton Press & Sun-Bulletin (Oct 28):
    Vestal landowners offer lease plan for gas drillers

    The Vestal Coaltion, a group of landowners in Broome County, NY, has created a draft lease agreement on behalf of its members and is now shopping it, looking for an energy company to sign the lease. According to the Press & Sun-Bulletin:

    A coalition of Vestal landowners has a deal for you: Roughly $46 million and 20 percent royalties for mineral rights to about 8,000 acres.

    A group of about 400 property owners signed a lease that would make it attractive for energy companies to do business with them, said Marty Leab, a coalition organizer. They have commissioned Dean Lowry and Llama Horizontal Drilling to find a taker in 90 days or less.

    Specifically, the lease would pay landowners a minimum of $5,750 an acre, plus 20 percent royalties, for a five-year lease of mineral rights, and a three-year extension, according to a copy of the lease obtained by the Press & Sun-Bulletin.

    According to the website for the Vestal Coalition, they’re still accepting new landowner members. Visit their site: www.coalitionconnection.com.

    Also, this tidbit of older news from the article, but still valuable to know:

    The market heated up as natural gas prices rose in spring 2007, and XTO bought mineral rights to land in the Deposit area for about $2,500 an acre. Since then, offers in the region have shot up to between $3,000 and $6,000 an acre and 20 percent royalties

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    Drilling Waste Water Treatment Plant Proposed for Owego

    Binghamton Press & Sun-Bulletin (Oct 28):
    Drilling processor targets Owego site

    From the Oct. 28th Press & Sun-Bulletin:

    A plant to treat waste from the Marcellus Shale is on the drawing board in the Town of Owego.

    Patriot Water Treatment pitched its plans to convert a former car dealership at 936 Taylor Road to a waste water treatment plant for Marcellus drillers at a planning board meeting Tuesday night. The proposal calls for installing holding and processing tanks in the existing building to treat round-the-clock shipments of drilling waste water, according to information from the planning board.

    And this:

    The plan, recommended for approval by the Tioga County Planning Board, estimates traffic from industrial waste haulers would average 96 trucks per day (four per hour), seven days a week. Haulers would use Day Hollow Road, Bodle Hill Road and Taylor Road to access the facility.

    Of course, anything to do with drilling is subtly (and sometimes not so subtly) opposed by the Press & Sun-Bulletin. The thought they want to leave you with is trucks lumbering down your street in the middle of the night hauling nasty chemicals ready to spill out on your front lawn.

    I know I would not want trucks round the clock going by my house–but–actually, they do! I live not a quarter mile from State Route 17 (the future I-86) and the traffic noise, especially from large trucks downshifting on a nearby hill, is 24×7. Traffic, especially if it’s mostly in the daytime, is a fact of commerce.

    Let’s let the good citizens of the Owego Town Board perform their due dilligence and render a decision that is fair to all the citizens of Tioga County. If the proposed location is too close to homes and traffic will be an ongoing disturbance, they should deny the permit. If not, grant it and reap the benfits of more jobs and more tax revenue from a new business in the area.

    I have confidence in our locally elected representatives to make the correct decision in this case.

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    M&T Bank Economist Bullish on Drilling in the Marcellus in PA

    Wilkes-Barre Times-Leader (Oct 29):
    Banker: Marcellus Shale to boost region

    M&T Bank economist and Chief Investment Officer James Thorne, Ph.D., addressed a recent meeting of the Greater Wilkes-Barre Chamber of Business and Industry about the impact of drilling in the Marcellus Shale in Northeast Pennsylvania. Among his comments:

    The Marcellus Shale gas play will be “a game changer” for Northeastern Pennsylvania, bringing a “huge economic injection” and making life here very different a decade from now…

    He also said,

    The region will get “a huge shot in the arm” from natural gas drilling. “The economic forecast is very bright.”

    There was also this interesting update about drilling activity in Luzerne County:

    Many landowners in Luzerne County have entered into leases with drillers, but no wells are yet operating in the county.