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Pennsylvania to Staff Up for Marcellus Boom

Pennsylvania's Department of Environmental Protection (DEP) is slated to hire 68 additional personnel to ensure that drilling companies obey state laws and protect water supplies as they ply the the Keystone State's portion of the prolific Marcellus Shale play. Gov. Edward Rendell directed the staff increase. DEP also is to strengthen oil and gas regulations to improve well construction standards, Rendell's office said.

"Interest in Pennsylvania's Marcellus Shale formation is greater than ever before, and as natural gas prices continue to rise that interest will only increase," Rendell said. "In fact, the industry has told us that they expect to apply for 5,200 permits to drill in the Marcellus Shale this year -- nearly three times the number of permits we issued in all of 2009. Given these conditions, an extraction tax is gaining widespread support across our state and I will again ask the General Assembly to enact such a levy [see NGI, Jan. 18]. It is fair and affordable to drillers. They know it, and so do members of the House of Representatives who voted for it last year.

"We were able to hire 37 additional inspectors and permitting staff in 2009, but the industry's projected growth in 2010 means that we need additional inspectors to ensure oil and gas companies follow environmental laws and regulations."

New York's governor recently proposed taxing Marcellus Shale wells in his state (see NGI, Jan. 25).

The Marcellus Shale Coalition (MSC) expressed its support for the new hires in Pennsylvania.

"The Marcellus Shale Coalition has consistently supported the hiring of additional DEP staff to monitor natural gas wells in the commonwealth, as reflected in its proactive endorsement of permit fee increases in 2009 to add and train new inspectors," said President Kathryn Klaber.

DEP said it performed 14,544 drilling site inspections in 2009 and took 678 enforcement actions against drillers for violations.

The 68 additional personnel are to be funded entirely from money generated by new, higher permitting fees that were instituted in 2009 -- the first such increase since 1984. The new hires are exempted from a general hiring freeze instituted last year, the governor said.

Rendell said DEP's work to amend Pennsylvania's oil and gas regulations will strengthen well construction standards and define a drilling company's responsibility for responding to gas migration issues, such as when gas escapes a well or rock formation and seeps into homes or water wells. Specifically, he said the new regulations will:

The new regulations were offered for public comment last Friday before going through DEP's rulemaking process.

MSC took the opportunity to reiterate its belief that gas migration does not present a significant risk in Marcellus Shale gas operations. MSC also said only one of every three wells permitted are drilled, so estimates of drilling activity based on permit applications are misleading.

Interest in Pennsylvania's piece of the Marcellus Shale has been increasing. One-third of the more than 6,200 oil and natural gas drilling permits DEP issued in 2009 were for drilling in the Marcellus Shale. By comparison, only four of the more than 6,000 permits issued in 2005 were for the Marcellus formation.

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