Re: The Marcellus Shale: A Game Changer for the New York Economy?:
Read with interest and some amusement Mr. Kurkoski's panegyric to shale gas in New York.
Most of it was lifted in whole cloth from industry propaganda and much of it was misleading.
Mr. Kurkoski grossly overstates the economic upside of shale gas industrialization in New York.
In his ad valorem tax estimates, he uses a gas price of $9.80 mcf which is $7 higher than the current prices. (3.7 times higher)
In fact, $9.80 is almost twice what the federal Energy Information Agency predicts gas prices will be by the end of the decade - 2020
This ad valorem tax hoax has been floating around for some time, it was first used in the Town of Worcester.
It makes the assumption that a shale gas well will be economical during exactly the 24 month window it produces.
At current and projected prices, no dry gas well would be economic in New York
There is no indication that Marcellus or Utica will be economic in New York north of the border counties.
So the ad valorem taxes, the employment estimates, etc. are premised on assumptions that have no economic substance.
As presented by Mr. Kurkoski, they are specious conjectures.
2. "Lots of wells have been drilled in New York" /"New York has the best regulations" etc.
Indeed, lots of wells have been drilled in New York for decades and the results bode ill for shale gas industrialization.
A. Many of the wells have been simply abandoned to pollute the groundwater.
B. The state has never had an adequate regulatory agency or even a full set of regulations for gas wells
When the Department of Mineral Resources was last audited, it was found deficient in all aspects.
Conditions have not improved at the DEC in this regard, they have recently gotten demonstrably worse due to staffing cuts.
C. The few regulations the state has - as evidenced in the setbacks of a gas well from structures - are simply the worst in the US
100 feet from a residence. 150 feet from all other structures
No mortgage lender would lend on a property this close to a shale gas well.
D. After decades of drilling, NYS remains one of the few places on the planet where gas production is untaxed by the state
At best, this indicates a certain indolence on the part of previous administrations, and is the cause of the DEC's chronic under-staffing.
3. "Over 1 million wells fracked with no problems" Isn't it pretty to think so ?
Most gas wells leak methane. And the industry studies show it.
Over time, they all will leak. The metal will rust. The cement will spall., etc.
The industry knows this - but does not like to talk about it, much less admit it in public.
4. Most major problems are ignored
Mr. Kurkoski is silent on most of the major negative impacts of shale gas industrialization.
For instance, he fails to mention the ruinous effect of heavy trucking on rural roads and villages.
He does not discuss the appallingly disparate treatment of water resources under the proposed regulations
And is silent on the most intractable problem of all - where to get rid of billions of gallons of fracking flowback
To summarize Mr. Kurkoski's gaseous hagiography - 'What could possibly go wrong ?'
James "Chip" Northrup