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Maryland Regulators Say Marcellus Can Be Developed Safely

Maryland's portion of the Marcellus Shale can be developed safely, as long as oil and natural gas operators agree to use best practices and the state embraces vigorous rules for well monitoring, inspection and enforcement, according to a draft report by two state agencies.

The Maryland Department of the Environment (MDE) and Department of Natural Resources (DNR) released a 109-page draft report on Tuesday per an executive order by Gov. Martin O'Malley in 2011 (see Shale DailyJan. 12, 2012). The executive order also created the Marcellus Shale Safe Drilling Initiative Advisory Commission (MSSDIAC).

“It is the judgment of the MDE and the DNR that, provided all the recommended best practices are followed and the state is able to rigorously monitor and enforce compliance, the risks of Marcellus Shale development can be managed to an acceptable level," regulators said. "Some of the proposed best management practices have not been tested, and although we are confident that they will reduce the risks, some risks will remain, as is the case with all industrial activities.

"Best practices and rigorous monitoring, inspection and enforcement can reduce the risks to acceptable levels, but cannot completely eliminate all the risks. Because knowledge and technology are continuously advancing, it will be necessary to adaptively manage shale gas development by requiring additional newly developed best management practices that provide improved protection for public health and the environment."

Only two counties in Maryland -- Garrett and Allegany 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.

The report found that under a scenario of maximum development over the course of 10 years, during the peak year Alleghany County could see 908 new jobs, $1.8 million in tax revenues and $2.3 million in severance tax revenues. Meanwhile, the peak year in Garrett would create 2,425 new jobs, $3.6 million in tax revenues and $13.5 million in severance tax revenues.  A final report is expected by the end of the year.

O'Malley, a Democrat, was defeated in early November in his bid for re-election by Republican Larry Hogan. During the gubernatorial campaign, Hogan said he supported hydraulic fracturing and Marcellus Shale development in the state.

MSSDIAC was launched to help policymakers decide whether to allow shale development and 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.

Last August, researchers from the University of Maryland said Marcellus 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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