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Maryland Resort Landowners Oppose Vertical Marcellus Drilling, But OK With Horizontal

A property owners' association in a popular western Maryland lake resort area said it opposes surface structures for vertical drilling for Marcellus Shale gas, but is amenable to horizontal drilling and hydraulic fracturing (fracking) that accesses the play from a distance.

In a position paper and an accompanying letter to the Garrett County Board of Commissioners, the Property Owners' Association of Deep Creek Lake Inc. (POA) -- whose members collectively hold about 1,000 properties -- said it is against "shale gas recovery operations," on the grounds that drilling would impact the rural character of the area, possibly impact water resources and damage property values.

The POA added that although the Marcellus Shale Safe Drilling Initiative Advisory Commission (MSSDIAC) "has been addressing the broad range of risks/adverse impacts potentially associated with deep shale gas recovery if drilling/fracking were to proceed...[and] will likely propose a shale gas regulatory regime which many would view as a 'gold standard'...there are a number of considerations which have led us to the position that vertical drilling, and the associated surface infrastructure, should not be a 'permitted by right use' nor permitted at all."

But POA added that by its calculation, if vertical drilling were prohibited the county would only lose 2.8% of the "projected economic benefits of shale gas recovery," assuming horizontal laterals coming from outside the area were about 8,000 feet in length. That would be offset by the economic benefits derived from severance tax revenues and jobs created.

“We were silent really on the subject of horizontal drilling,” POA President Bob Hoffmann told NGI’s Shale Daily on Tuesday. “The sense of the Board of Directors was that the depth is sufficient that the likelihood of impacting the quality of the water in the lake itself, as well as groundwater sources for wells [would be minimal].”

MSSDIAC was launched by Gov. Martin O'Malley in 2011 to help policymakers decide whether to allow shale development and decide how to proceed. In 2012, the 14-member panel recommended that the state impose both a fee and a tax on shale gas development, as well as shift more costs to industry (see Shale Daily, Jan. 12, 2012).

The POA cited research by the Garrett County Board of Realtors that asserted property located within 0.9 mile of a wellhead declined in value by 5-22%. "Such declines, noting an indicative average of 13%, would obviously be of concern to property owners," the POA said. "The supporting studies often cite perception of risks to drinking water and/or concerns about 'industrialization' as the cause of decline -- the so-called 'stigma effect.'"

Only two counties in Maryland -- Garrett and Allegany, which are in the western panhandle -- overlie the Marcellus Shale, which the U.S. Geological Survey estimates could contain as much as 2.383 Tcf of technically recoverable natural gas.

Last August, researchers from the University of Maryland said Marcellus Shale development would likely have negative impacts on air quality in the region, while fracking would present a moderately high risk of public health consequences (see Shale Daily, Aug. 19).

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