NORWICH – Last week’s release of the New York State Department of Environmental Conservation’s draft regulations on permitting natural gas hydrofracking into shale “clearly involves our future,” said a spokesman for Norse Energy, Inc., the most prominent natural gas developer in Chenango County.
“We are very encouraged by the DEC. I can’t say until we go through it - all 900 plus pages of it - that we agree with everything in it,” said Norse attorney Dennis Holbrook, “but they’ve gone to great lengths to try to address every detail ... to be very thorough.”
Norse Energy, a Norwegian-based company (also known as Nornew), has successfully brought natural gas to the marketplace from wells drilled into sandstone formations in Madison and Chenango County, primarily in the towns of Lebanon, Smyrna and Plymouth. The company says it has nearly all of the available acreage in the region’s Marcellus and Utica shales leased or purchased already, and is actively pursuing a business partner with the size, financial strength and experience to help them develop it.
“It’s been tough to do that while we were in that holding pattern,” Holbrook said, referring to the 18 months that it took the DEC to reveal the regulations.
“We see a lot of potential, but I use that word because up until now, it’s not been possible to test horizontal drilling and hydrofracking of those formations.”
The combination of horizontal drilling and hydraulic fracturing, which uses millions of gallons of water and generates an equal amount of waste, is widely used in the U.S. as a means of recovering gas from tight shale formations. The controversial technology and confirmation of the vast quantities of natural gas available in Marcellus is what prompted Gov. David Paterson’s call to revisiting the state’s permitting process.
It’s no secret that interest in Chenango’s Marcellus holdings isn’t too far off in the future. Major energy companies such as Hess, Fortuna, Chesapeake and XTO Energy have already leased large swaths of land just over the border in Broome County, offering landowners $5,000 an acre or more plus royalties for the right to drill. If the economy continues to trend in right direction, and natural gas prices stabilize around the $5 mark, Holbrook said the Southern Tier, including Chenango County, will definitely see shale development.
The DEC’s draft Supplemental Generic Environmental Impact Statement (SGEIS) contains pre-drilling, drilling and post-drilling requirements that may be new to companies. Some pre-drilling stipulations call for the disclosure of the chemicals used in fracturing; for well testing prior to drilling; for water consumption expectations; mitigation planning of greenhouse gas emissions; and visual, noise and trucking impacts.
In addition, there will be more stringent drilling and casing requirements; state inspectors must be present when operators commence cementing well-bore casings; and operators choosing to store formation and flowback water on-site must use steel tanks and double-liner systems similar to those required for landfills.
Companies will not only have to follow Susquehanna River Basin Commission and Delaware River Basin Commission protocols for water withdrawal, but also complete a more stringent and protective streamflow analysis in regards to water withdrawal plans – whether inside or outside the Susquehanna or Delaware basins. Water for metropolitan New York is piped downstate from those watersheds.
At least one local official questioned whether the document addresses smaller water withdrawals, and whether the regulations even apply to non-shale hydrofracking drilling operations, such as those underway by Norse Energy.
“Although this has been prompted by the enormous need for water to frac in the Marcellus, am I right in assuming that it will indeed come into play for all drilling in New York State, in any formation?” Town of Smyrna Supervisor James E. Bays asked.
Jim Goldstein, Town of Lebanon Supervisor, stated that he is concerned that smaller water draws coming from private farm aquifers owned by gas development companies won’t be regulated by the DEC. “... do these regs adequately address what has been identified as a major loophole?” he wrote in an e-mail to his constituents.
Chenango County Natural Gas Committee Chairman Peter C. Flanagan said he hadn’t had time to read through the entire document, but was glad to see that companies would be required to test water wells prior to drilling.
There were a number of issues, however, that were not mentioned.
“It certainly doesn’t address all of the issues that concern us, such as spacing units,” he said. The natural gas committee has questioned whether Norse and the DEC have spaced units for wells and placed the wells within them uniformly, accurately and fairly.
The SEGIS can be found on the NYSDEC website, but there is also a printed copy available in the Planning Department at the Chenango County Office Building. The public is welcome to stop in to look through it. The gas committee will be accepting comments, questions or concerns and submitting them to the NYSDEC on behalf of the community. Yancey Roy, a media spokesman for the DEC, said the public will also have an opportunity to comment on the draft at public meetings. Times and places have not yet been announced.
Oral testimony may be delivered on the record at a legislative public hearing scheduled for Oct. 15 in Albany. Some in the industry, particularly environmentalists, are already saying that holding a public hearing only 60 days after releasing the draft doesn’t allow for enough time to review it.
Binghamton University’s Adjunct professor of Environmental Studies Adam Flint is calling for 90 days. “Given the gravity of the decision New Yorkers have to make, 60 days is insufficient to comment on a very detailed 908 page dSGEIS. The locations and times of the hearings should be announced as soon as possible, and scheduled at times and places to maximize participation of all New Yorkers.”
Anti-drilling activists from the Chenango, Delaware, Otsego group were quick to release statements that referred to a natural gas company’s repeated spills at well sites in Dimmock Township, PA jstu a few weeks ago. Fracturing fluids are suspected in the destruction of a 30 mile stretch of Dunkard Creek, they said.
In response to the release of the long-awaited document, Brad Gill, executive director of the Independent Oil & Gas Association of New York said: “We have begun a review of the SEGIS and remain hopeful that the state DEC has found a balance that continues to protect New York’s environment and allows responsible exploration for natural gas in the Marcellus Shale. This rich deposit of natural gas holds tremendous economic potential for New York. A regulatory structure that is tough but fair will allow this state to realize this tremendous opportunity.”