12:07pm

Mon December 6, 2010
Marcellus Shale

First findings of Cornell study on Marcellus drilling in New York: proceed with caution

Early results are circulating from what's being billed as the first study of the total effects New York State can expect from natural gas drilling in the Marcellus Shale. The research effort, funded in part by the Ithaca-based Park Foundation, was led by Susan Christopherson, an economic geographer at Cornell.  Christopherson set out to answer two big questions:

1. How will the pace and scale of drilling in the Marcellus Shale affect costs to communities and the environment?

2. What can we expect regarding economic development long-term? What kinds of jobs will be created?

Christopherson presented some of the key takeaways from her research in Albany last month:

  • Well drilling and natural gas production will be frontloaded, looking more like a boom than slow and steady growth. Royalty revenues and the industry's wider economic impact will follow the same pattern, arriving early and decreasing with time. More research is required to calculate what the total job and revenue impacts will be.
  • Drilling will produce accompanying pressures on infrastructure, like roads, and on services, like health care.  The state needs good policy in place to respond to those demands.
  • Long term economic development is uncertain. A boom will produce higher costs for housing and labor, which could squeeze out other industries in a region. Long term, a diversified economy will produce better, more stable income for communities.
  • Historically, counties in New York and Pennsylvania that already have had gas production (from formations that are more accessible than the Marcellus shale) have seen greater population declines and slower income growth.
  • Final words: "Policy Matters!"

More work needs to be done to flesh out these results. For example, there could conceivably be other links between population decline and drilling. We'll be talking with Christopherson about these findings later this week.