ALBANY, N.Y. – An oil and gas industry group has warned that the state could experience a greater exodus of business while Gov. Andrew Cuomo waits for the results of a Pennsylvania health study before deciding whether to allow fracking.
“For business owners, the opportunity is not here in New York,” said Jim Smith of the Independent Oil and Gas Association of New York.
Smith said Sunday that permit applications for conventional vertical gas wells, which are still allowed in the state but are less profitable than the far-larger shale gas wells, have dropped from about 600 in 2008 to below 200 in 2012 as the industry has moved to other states.
“We can assume the exodus we’re seeing now will continue” if a moratorium on drilling remains until the results of the new study are in,” he said.
The Associated Press reported Saturday that Cuomo came close to approving a limited drilling plan for as many as 40 shale gas wells last month before environmentalist and former brother-in-law Robert Kennedy Jr. helped persuade him to await the new study, which could delay a decision for up to a year or longer.
Cuomo is expected to announce a formal decision after the Department of Environmental Conservation completes its 5-year environmental impact study, but that decision has already been delayed twice. DEC Commissioner Joe Martens has said that study will be finished after Health Commissioner Nirav Shah makes recommendations based on his own review, which will include a look at the new $1 million Geisinger Health System study launched recently in Pennsylvania.
Unlike most studies funded by advocates or opponents of hydraulic fracturing, the Geisinger study would be funded by the Sunbury, Pa.-based Degenstein Foundation, which is not seen as having an ideological bent.
“I think it will be pivotal,” Kennedy told the AP. Preliminary results are expected within the year, but final conclusions could be years off. The study will look at health histories of hundreds of thousands of patients who live near gas wells and other facilities producing natural gas from the same Marcellus Shale formation that New York would tap.
While opponents of fracking are pleased that Cuomo will wait for the Pennsylvania study, landowners are preparing to sue New York over lost gas-leasing opportunities.
New York has had a moratorium since 2008 on horizontal drilling and high-volume hydraulic fracturing, which frees natural gas from shale by injecting a well with chemically treated water and sand at enormous pressure. Other states in the gas-rich Marcellus Shale formation have seen local economies boom as drilling rigs have sprouted up.
Landowners hoping to lease to gas-drilling companies and earn royalties on gas production are preparing a lawsuit against the state because of the moratorium. The lawsuit will allege that the state has taken property rights in violation of the state and federal constitutions, said Scott Kurkoski, a lawyer representing the Joint Landowners Coalition of New York.
“While our nation’s leaders bring us closer than ever to achieving energy independence, cleaner air and economic prosperity, New York threatens to impede our progress and deny the constitutionally guaranteed rights of New York landowners,” Kurkoski said in a statement, citing comments from President Barack Obama and New York City Mayor Michael Bloomberg in support of natural gas.
Smith, of the Oil and Gas Association, said “There’s no scientific reason at all to continue these delays.”
John Armstrong of New Yorkers Against Fracking, a statewide coalition of health and environmental groups, said “it’s a great sign” that Cuomo reportedly is waiting for health study results before making a decision on fracking. But the Geisinger study won’t be enough to satisfy the demands of his group, he said.
“Geisinger and other studies have the potential to give us some important data, but we also need to look at concerns specific to New York state,” Armstrong said. “We’re asking for a comprehensive health impact assessment,” which would include participation by the state’s medical community as well as the public, he said. “We’re also calling for a study of social and economic impacts.”