NORWICH – New York Governor David Paterson sent mixed messages late Saturday evening by first vetoing a bill that would have banned further vertical drilling of natural gas wells until late spring, but then pushing off release of new permitting regulations for the more controversial high water volume horizontal drilling method until July.
His veto, which was announced first, was initially characterized as pro-business and hailed a job-saver by the Independent Oil and Gas Association, New York Farm Bureau, Southern Tier landowner coalitions and other organizations and individuals who support drilling.
The moratorium would have, effectively, halted existing and potential vertical natural gas and oil exploration in New York, and put the future of thousands of workers and hundreds of employers in jeopardy. The governor’s office, itself, recognized the legislation – which was passed overwhelmingly within the state’s Senate and Assembly – had gone too far.
“...Vertical drilling has been a fact in this state for 40 years without demonstrable environmental damage. Permitting for such drilling will continue unless the Department of Environmental Conservation’s comprehensive review requires it to be stopped,” a press release stated.
The governor subsequently issued an executive order that postponed release of the DEC’s updated permitting regulations for shale formations until July 1, 2011. He had already placed a de-facto moratorium on such permits when directing the DEC back in 2008 to begin a comprehensive review and analysis of high-volume, horizontal hydraulic fracturing in shale formations. The document, called the Supplemental Generic Environmental Impact Statement, was anticipated to be completed as early as January or as late as March.
The governor emphasized that high water volume fracturing must be safe without a doubt. “The enormous revenues that could eventuate from such drilling would not be worth the cost of serious environmental harm. All available evidence, including data from other states, will be examined,” he said.
Those on both sides of the hydraulic fracturing debate expressed dissatisfaction with Paterson’s actions. Catskill Citizens for Safe Energy, Citizens Campaign for the Environment, Catskill Mountainkeeper and other organizations against hydraulic fracturing said the executive order doesn’t go as far as the moratorium would have.
“It allows so-called vertical wells – exactly the kind of wells that were responsible for ruining nine square miles of aquifer and poisoning the drinking water of more than a dozen families in Dimock, Pennsylvania, along with many other pollution incidents in Pennsylvania – to move forward. This loophole still leaves New Yorkers at risk and gas corporations are already threatening to exploit it,” said a combined press release from 13 groups opposed to drilling in the state.
Senate Majority Conference Leader John L. Sampson said he was “deeply troubled” with the Governor’s veto.
“We want jobs – but we want those jobs to be safe, and for their work to produce no harm to the environment. Our legislation was a common-sense and bipartisan approach, carefully crafted to meet the real-world concerns of workers, farmers and families across New York,” he stated Sunday.
The bill would not have shut down Norse Energy Inc.’s natural gas exploration in Chenango County. The Norwegian energy company’s work, horizontal drilling in the Herkimer Sandstone, doesn’t require hyrdraulic fracturing.
But it would have adversely impacted the company’s future.
“Every day we get calls from Norway that ask the same question: ‘Is New York open for business?’” said company Vice President Dennis Holbrook. “If companies perceive New York to be a negative environment, it puts us in a much more difficult position to go out and pursue the shale.”
“The governor vetoed legislation that was admittedly over broad. In that sense, it’s an improvement. But the problem we continue to have is that the science should be dictating this and not politics,” Holbrook said, adding that he would have preferred that the governor “allowed his own agency (the DEC) to do the work he’s already asked them to do.”
“What’s the magic about July 1?” he asked.
Norse has a significant land position of 180,000 net acres in Chenango and Madison counties, and since 2008, has invested more than $100 million alone in seismology, drilling and pipeline infrastructure. The company is currently drilling natural gas wells in the Town of Smyrna.