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Speakers Warn of Misinformation About Fracking, Effects on Industry

The Marcellus Shale Coalition’s (MSC) annual conference in Pittsburgh was underscored with warnings and apprehension about a battle for public opinion between the oil and natural gas industry and those opposed to it.

Many of the event's keynote speakers touched on the broader implications of misinformation about onshore oil and gas development, or high-volume horizontal hydraulic fracturing (fracking), imploring attendees to step up and fight against a rising tide of opposition that they claimed will only intensify as shale development continues to increase in Pennsylvania and other parts of the country.

"The disinformation and propaganda machine against what you do is frightening," said the conservative Heritage Foundation's chief economist, Stephen Moore, in the first keynote address at this year's Shale Insight conference (see Shale Daily, Sept. 24). Moore said the industry must do a better job of championing its successes, noting what he believes is currently a losing battle for the public's perception of fracking.

Moore told of a recent visit to a high school classroom in Florida, when he asked more than 20 students if "fracking was good or bad," just three of them raised their hand to say it was positive, he said.

The conference, which in recent years has been located in Philadelphia -- closer to the state capitol in Harrisburg -- took a decidedly political tone at times. Some speakers derided President Barack Obama for his economic policies and energy agenda.

One of the keynote speakers, Bill Richardson, a former Democratic Governor of New Mexico and secretary of the Department of Energy under President Bill Clinton, opened his remarks by joking that he was likely the "only Democrat in the room," minus a kitchen staffer in the back.

Richardson still found plenty of common ground with some of the event's conservative speakers.

He said the U.S. was once floundering without a plan for dwindling oil and gas supplies in a situation that has since been completely reversed. Richardson said it was imperative that the industry step up its public relations efforts to combat a noticeably growing opposition movement. Increasing oil and gas production, he added, is particularly important given the geopolitical role it could play overseas with worsening situations in the middle east and a dour outlook for energy markets in Asia and Europe.

XTO Energy Inc. President Randy Cleveland said the onus to win the public's support is on the industry, not on state or federal politicians.

"In the end, the success of our business is driven not only by how we've done our job, but by how successful we have been as a good corporate citizen and neighbor," he said. "We simply have to get this right, from planning and investment to construction and project completion. We need to continue to reach out and educate the public. Our presence in local communities around the nation has given us the opportunity to engage with the public at a very local level."

EQT Corp. CEO David Porges went further by admitting the industry has at times erred in meeting or acting on local concerns in the communities where it operates. He said that although operators have shown acumen in fulfilling their state and federal regulatory obligations, simple "nuisance factors," such as truck traffic, dust, loud noise and bright lights have not been adequately controlled.

"When companies run into obstacles in the community it's often because they didn't address these issues well enough, or sometimes local ordinances aren't enough to address concerns from landowners," Porges told the audience. "These standards need to be our own and they need to be high. This is exactly what we need when we talk about our social license to operate.

"Let's be frank, EQT and others in this room have learned a great deal over the past few years about community interaction. Unfortunately, we've all had instances where development could have gone more smoothly."

The speakers remarks came ahead of an appearance by Pennsylvania's Republican Gov. Tom Corbett on the final day of the conference, when about 50 protesters gathered in front of the convention center. They beat drums and marched in opposition to both Corbett's presence and the oil and gas industry, wielding signs that read "Stop Corbett" and "Hey Corbett, put our kids before corporate tax breaks."

The protest was organized by a Pittsburgh group and comes at a time when Corbett is trailing in polls for November's gubernatorial election. His Democratic challenger, Tom Wolf, has called for a 5% severance tax on the oil and gas industry (see Shale Daily, May 21). Wolf has indicated that he'd like to raise $1 billion a year from the existing impact fee and a severance tax to help fill a state budget gap and provide more education spending that he claims Corbett cut.

At the conference, Corbett stood his ground and reiterated that he does not support a severance tax on natural gas production, noting it could be deleterious to the state's competitive edge when it comes to attracting development capital from producers.

"I think the industry needs to be much more vocal about that; you need to educate the public because you have options. I certainly hope you don't exercise those options, but you have them," Corbett said. "This is a very tenuous time with this election; it's very important in order to be able to keep this industry in the direction it's going. What I know is that I need to see that this industry gets a firm foothold on all three levels -- discovery, development and distribution and marketing -- and we're a far-cry from where we need to be.”

During the conference, the MSC announced a public advertising campaign that will promote the industry in the state through next summer, when lawmakers will once again take up the state budget. That campaign will attempt to put a positive spin on the word "fracking" and what it means to Pennsylvania.

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