3:18pm

Mon December 6, 2010
Marcellus Shale

Drilling supporters ask Paterson to veto hydrofracking moratorium

Broome County officials are urging Governor David Paterson not to sign a moratorium on hydraulic fracturing.  The moratorium is allegedly symbolic, given that the six month delay lines up with the Department of Environmental Conservation's ongoing review of fracking.  But proponents of drilling say that signing it could still have negative affects for landowners.

Broome County expects to play a central role in any economic activity resulting from natural gas drilling in the portion of the Marcellus Shale formation that extends under New York State.

The moratorium bill, meant to halt the use of hydraulic fracturing (or fracking), halts new permits until May of 2011.

County Attorney Joe Sluzar and others made the same case that the Independent Oil and Gas Association has made, that  broad language in the bill will also put a halt to conventional drilling already underway, eliminating jobs. The County Executive's office lost a bid this year to include future gas lease revenues in the upcoming, tightly stretched county budget.

Representing landowner groups, Attorney Scott Kurkoski of Levene, Gouldin & Thompson, LLP said further delay also hurts landowners' bargaining power to collect revenue from their property:

Everyday I have people in my office who executed two page leases, ten years ago, at $3 dollars (sic) per acre. The gas companies are trying to extend those leases by force majeure because of the existing moratorium. This new moratorium will simply give them more ammunition. If a gas company can extend a lease, it does not have to pay a new bonus at current market rates, perhaps $3,000 - $6,000 per acre. Landowners  lose the higher bonus and a chance to negotiate a new, more protective lease. And, New York State loses because of the lost income tax revenue on the new bonuses. But, once again, the gas companies win.

Governor David Paterson has so far failed to deliver a clear answer on whether he will sign the legislature's ban.  An inquiry to the DEC to find out how the agency plans to handle any lack of clarity in the legislation has not yet been answered. Watch this spot for more.