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Freeze on Marcellus Permits Approved by Maryland House

The Maryland House of Delegates has approved a bill that would freeze the permitting of Marcellus Shale drilling until 2013 while state agencies review the results of various studies into Marcellus development and hydraulic fracturing (hydrofracking), including a major study being performed by the U.S. Environmental Protection Agency (see Shale Daily, Feb. 24).

The House on Wednesday approved by a 98-40 vote the Marcellus Shale Safe Drilling Act (HB 852), sending it on to the state's Senate, where the bill was scheduled for first reading Thursday. Maryland Gov. Martin O'Malley has indicated that he supports the proposed moratorium.

Del. Wendell Beitzel, a Republican who represents rural Garrett and Allegany counties, had asked that the bill be defeated, saying that it was not supported by constituents in his district. Garrett and Allegany counties, located in the state's western panhandle, are the only counties in the state overlaying the Marcellus.

"There will be no drilling in anyone else's county, and it stands to have a very big economic benefit or impact to Garrett County," Beitzel said. If the moratorium is put in place, "drilling will occur all around Garrett County in neighboring states and those impacts, if any, will be felt in Maryland. But it appears that we will have to wait a while for something to happen in Garrett County."

The bill's chief House sponsor, Del. Heather Mizeur (D-Montgomery), said her office was flooded with messages of support for the bill from Garrett County following debate in the House Tuesday.

"We need just a timeout, we need to get it right. There are many other states that drilled first and asked questions later. Second chances are expensive. We need to get it right the first time," Mizeur said.

Maryland Department of Environment (MDE) Acting Secretary Bob Summers has told lawmakers that his department supports HB 852. MDE and the Maryland Department of Natural Resources want to put together an advisory committee that includes representatives from government, industry and academia to comprehensively study the impacts of development, according to Summers, who said industry would pay for the cost of the two-year study. In addition to EPA's look at hydrofracking and drinking water supplies, the committee would review studies from New York State and the Delaware River Basin Commission (see Shale Daily, Feb. 9; Dec. 14, 2010; Dec. 10, 2010). The advisory committee would be tasked with finishing its work by July 2013.

MDE could begin issuing permits during the study period if "information becomes available...sufficient to demonstrate that the extraction of natural gas from shale formations in the state can be accomplished without adverse impact to human health, natural resources or the environment," according to the legislation (see Shale Daily, March 22). HB 852 would also require MDE to consult with local governments when evaluating permits for drilling within the Marcellus.

On Tuesday the House voted down a series of amendments to the bill, all introduced by Beitzel, that would have ended the proposed permitting ban by June 2012, converted the review to a "summer study," and guaranteed his district representation on the review panel.

House Minority Leader Anthony O'Donnell (R-Calvert County) said he opposed the bill because it would limit the ability of the Dominion Cove Point LNG facility in his district to export liquefied natural gas (LNG). Dominion CEO Thomas Farrell has said the Lusby, MD, terminal could be reconfigured to export LNG to overseas markets, with Marcellus Shale as its supply backbone (see Daily GPI, March 14).

"With the discovery of the Marcellus deposit and other natural gas deposits in this country, we have an overabundance of natural gas that has the potential to be exported," O'Donnell said Wednesday. "Why wouldn't we do that and start to change our trade imbalance? We have a negative trade balance in this country. Why wouldn't we look for opportunities to create jobs, to export some of our product, to improve economic development in this state and to help my county? This is not just about the two counties in far western Maryland."

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