Shale Daily / NGI All News Access

Maryland Marcellus Moratorium Off the Table for Now

A debate over how to regulate the nascent Marcellus Shale industry in Maryland is progressing more subtly than similar debates in Pennsylvania or New York.

Rather than fight over a moratorium, Democratic and Republican lawmakers have proposed alternate ways for the state to decide how it will issue drilling permits.

State Delegate Heather Mizeur, D-Montgomery County, wants permits to be contingent on natural gas companies proving that drilling and hydraulic fracturing won't harm the environment. Meanwhile, two Republican lawmakers from the western counties that overlie the Marcellus Shale in Maryland want the state to create a permitting framework that covers specific concerns about Marcellus Shale drilling and disposal.

House and Senate committees will hear both sides in meetings in the coming weeks.

Mizeur's bill, along with a companion bill in the Senate, would prohibit the Maryland Department of the Environment from issuing drilling permits in the Marcellus Shale unless an applicant addresses concerns about heavy truck traffic, water use and quality, wastewater disposal, emergency response and bonding. The bill also requires the state to consult with the local jurisdictions where drilling is proposed before issuing a permit.

Although most of Maryland does not overlie the Marcellus Shale, Garrett and Allegany counties in the western panhandle are in the middle of Marcellus Shale country.

Delegate Wendell Beitzel and Sen. George Edwards, Republicans who represent those counties, introduced legislation that would create a permitting framework for Marcellus Shale drilling and disposal but doesn't keep the state from issuing permits until then.

Under their proposal, the Maryland Department of the Environment would have until the end of the year to craft regulations that include new standards for well casing and inspections, containment and disposal of drilling fluids, and site reclamation and bonding. Those regulations would then go before the General Assembly for approval.

The regulations would cover the discharge of drilling fluids into local bodies of water and create a testing plan to monitor drinking water sources. They would also require companies to disclose the chemicals they use to hydraulically fracture shale formations.

The legislative debate began in editorial pages of the Baltimore Sun.

Mizeur initially called for a moratorium, writing, "Permits must not be issued until the state develops comprehensive safety regulations, procedures and the enforcement capacity to minimize that risk moving forward" (see Shale Daily, Feb. 9).

In January Beitzel and Edwards wrote, "Putting a moratorium on natural gas drilling for fear that some may eventually find its way into the Chesapeake Bay would be akin to eliminating Maryland's burgeoning biotech industry as a way to prevent bio-terrorism."

Mizeur ultimately decided against a moratorium to keep the state from having to pay up to $3 million to assess the potential environmental risks of shale development.

The House Environmental Matters Committee will review both bills on Feb. 23, and the Senate Education Health and Environmental Affairs Committee will review them on March l.

In his State of the State address on Feb. 3, Gov. Martin O'Malley hinted at the issue by calling for Maryland to "streamline the business licensing and permitting process" in order to "to get government out of the way of job creation without compromising our environment."

O'Malley previously said he wouldn't allow hydraulic fracturing in Maryland without an assurance that it could be done without harming the environment.

The Maryland Department of the Environment has been reviewing drilling applications from Tulsa-based Samson Resources and Dallas-based Chief Oil & Gas LLC for several months. Both companies want to drill Marcellus Shale wells in Garrett County.

Although no legal moratorium is in place, New York is not issuing any permits for Marcellus Shale drilling until a supplemental generic environmental impact statement is completed (see Shale Daily, Dec. 14, 2010). Meanwhile recently elected Pennsylvania Gov. Tom Corbett announced plans to gradually lift a moratorium on drilling in state forests put in place by his predecessor, Ed Rendell (see Shale Daily, Nov. 15, 2010).

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