NORWICH – Whenever an energy company moves into a new town, telephone calls and e-mails from landowners, supervisors and town officials begin pouring into the Chenango County Planning and Development Department.
They want to know the latest standards for road maintenance and sound control, and the protocols for permitting seismic testing and road borings. A standardized set of regulations that would cross town and even county borders would be beneficial, said Chenango County Natural Gas Consultant Steven Palmatier, who works closely with the county’s planning department and Commerce Chenango.
Those attending a regional meeting last week at the County Office Building in Norwich discussed creating such a document, as well as a directory of businesses that companies could refer to and the types of curriculum needed to educate and train a future workforce for the energy industry.
More than 40 public officials, landowners and industry representatives attended the second gathering of the Chenango, Otsego, Delaware, Madison Regional Natural Gas Collaborative. Palmatier served as moderator.
Town of German Supervisor Richard Schlag said his town board had been discussing road bonding for about two years, looking at other town’s regulations and trying to formulate their own. “We haven’t come up with a formula yet that protects our town roads, but isn’t too exorbitant for companies to want to drill,” he said.
Speaking for the handful of energy industry representatives in attendance, John Holko of Lenape Resources, Inc. of Alexander, said companies coming into New York aren’t really frightened by the regulations that are being proposed at the state level, but rather what at the local level “might jump out and ruin a $100 million project.”
“We (New York State) have a long-standing relationship with the energy industry here. The industry has a good record of complying with the regulations and requirements,” he said.
Holko and Norse Energy, Inc.’s Steve Keyes, vice president of Regulatory Compliance and Operations/Drilling, suggested that the collaborative group refer to the New York State Department of Environmental Conservation regulatory document for guidance as well as ordinances and road protections already adopted by other regions.
When asked for industry support to produce a regional business directory or advice, for example, about attending tradeshows to market empty warehousing spaces to the industry, Lanape said the gas industry is “looking from the fence” right now.
“If there’s one industry you want in your backyard, it’s this one. What we do all comes back to the local community. But, if New York State doesn’t move soon, I say save your money,” said Holko.
While the NYSDEC reviews its draft of regulations, and scrutinizes the possible environmental fall-out from hydrofracking into the Marcellus Shale, companies are looking elsewhere to satisfy their shareholders’ best interests. Lenape, Norse and GasTem USA, the three industry companies most active in the region, all expressed various levels of surprise at how long the DEC’s process is taking.
“The volumes of natural gas in New York State are huge. It’s a game changer. We are very slow to wake up. We can’t understand it,” said Holko.
Keyes reported that Norse Energy had pulled back operations to allow the roads to thaw and dry out, but is still planning to drill more wells and build its pipeline infrastructure. However, to be more specific about the company’s future plans would be impossible, he said.
“You tell us what the state’s going to do and we’ll tell you what we’re going to do,” he said.
“Natural gas is going to transition us to the next resource, whatever it is. New York could be left sitting with what’s here, still in the ground,” said Holko.
Gastem USA President Orville Cole reported that a group of elementary and secondary teachers in Otsego County are currently shadowing workers as they develop well sites. Plans are to develop a curriculum based on the experience. Gastem is also anchoring a a project with SUNY Morrisville and Colgate University to identify the potential uses for drilling cuttings. With a higher Ph level, the cuttings could be spread on farmers’ fields in place of lime, Cole said.
“We want jobs to be done by our own small businesses. We want to provide the training that would be desirable,” said Marie Lusins-McLachlan, a former member of the Town Council Oneonta and the New York State Association of Towns.
Holko said the biggest deterrents to doing business in New York were high property taxes, high energy costs and high labor costs. But municipalities that develop their own natural gas-powered energy plants would drastically cut a business prospect’s energy transportation costs. The power plant could be used as a sales tool to attract industry.
“Municipalities can have to say about what they can do to bring us in under their umbrella. Build a power plant, give them the business,” said Keyes.
Joe Mirabito, of Mirabito Fuel Group in Sidney, said the costs of doing economic development in New York Sate was prohibitive due to the regulatory environment.
“There’s a high percentage of tax on energy. For it to become competitive again, they would have to look at the tax structure. Municipalities have to look at their tax structure, too, to keep from double taxing people,” he said.