June 13 (Bloomberg) -- New York Governor Andrew Cuomo is considering a plan that would allow natural-gas drilling by hydraulic fracturing in five counties near the Pennsylvania border, an administration official said.
Permits would be issued only where residents support drilling, according to the official, who requested anonymity because the proposal isn’t final. New York placed a moratorium on the process known as fracking in 2010 so state regulators could conduct an environmental review and develop rules. The review is to be released in the next few months.
“No final decision has been made, and no decision will be made until the scientific review is complete and we have all the facts,” Josh Vlasto, a Cuomo spokesman, said in an e-mailed statement.
Cuomo, a 54-year-old Democrat, has been under pressure from energy companies and some localities to allow drilling so it can spark the type of economic development seen in states from Wyoming to West Virginia that have cashed in on fracking. Environmentalists have pushed back, delivering thousands of letters to his office urging him to ban the practice as the U.S. Environmental Protection Agency studies the effects on drinking water and plans national regulations.
New York sits on the northern edge of the Marcellus Shale, which may hold enough natural gas to supply the U.S. for two decades, according to Terry Engelder, a geosciences professor at Pennsylvania State University.
Under the plan being discussed by the Cuomo administration, drilling in New York would be allowed only in Broome, Chemung, Chenango, Steuben and Tioga counties, if local governments agree to it, the administration official said. The New York Times reported the counties under consideration for permits today.
Fracking, in which millions of gallons of chemically treated water and sand are forced underground to break up shale rock and free trapped gas, has been banned in more than 20 towns in New York, according to Karen Edelstein, a geographic information-systems consultant in Ithaca, New York.
Anschutz Exploration Corp. and Cooperstown Holstein Corp., a dairy farm, have appealed decisions by New York state judges that upheld local bans on oil and gas drilling in two towns.
Tom West, an attorney for Anschutz and a lobbyist for the industry in Albany, said Cuomo may be following the law as determined by the rulings in those cases by considering a plan that would allow local governments to block drilling.
Allowing fracking in a few specific areas would give energy companies the opportunity to determine the quality of New York’s gas deposits, West said today in a telephone interview. New York law, though, requires the state to allow drilling across all counties, he said.
“As a first step, this may be a way to get past all the hysteria,” West said. “But if this is a permanent line in the sand, how do you compensate the people on the wrong side of the line?”
The counties where fracking would be allowed are probably the most economical places to drill into the Marcellus Shale in New York, Engelder said. The formation moves closer to the surface as it extends northward, and the deeper the rock, the more gas it’s likely to hold, he said. The five counties are on New York’s Southern Tier.
Drilling into a deeper formation is also environmentally safer, he said.
“The deeper the formation, the more likely it is the frack fluid will be sequestered forever,” Engelder said. “If it’s sequestered forever, then there is no threat to groundwater.”
A group of 76 lawmakers sent a letter to Cuomo today asking him to ban the recycling of wastewater before allowing any drilling in the state, among other concerns.
“The Legislature is a full partner with the governor in safeguarding New York’s irreplaceable environment and protecting public health, and we cannot allow any shale fracking until or unless these concerns are resolved,” Assemblywoman Barbara Lifton, a Democrat from Ithaca in central New York, said at a press conference today.
Emily DeSantis, a spokeswoman with the Department of Environmental Conservation, said in an e-mail that the state hasn’t yet determined whether it will even allow fracking.
“If high-volume hydraulic fracturing moves forward in New York, it will do so with the strictest standards in the nation,” DeSantis said.
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