Philadelphia Tribune: Marcellus Shale Coalition Chief Touts Potential, Prosperity

Written by Larry Miller

  • Kathryn Klaber, CEO of the Marcellus Shale Coalition said the development of the resources will bring a new level of prosperity to Pennsylvania – a state which like so many others – has been hit hard by economic down turns.

The Marcellus Shale formation is a vast reservoir of natural gas – perhaps the largest in the world according to some experts.

It crosses fives states, New York, Pennsylvania, Ohio, Virginia and Maryland and it overlays another deeper natural gas resource known as Utica Shale.

It is the largest formation of natural gas on the planet and is worth trillions of dollars. Kathryn Klaber, CEO of the Marcellus Shale Coalition said the development of the resources will bring a new level of prosperity to Pennsylvania – a state which like so many others – has been hit hard by economic down turns.

“The U.S. Department of Labor and Industry just released the number of jobs either directly or indirectly related to the drilling industry and there are more than 240,000 employees statewide. Nearly 75 percent of the new hires are from Pennsylvania and L&I reports that there are nearly 3,000 jobs related to gas development. Many of these jobs are technical in nature but there are many, many labor related jobs. This is a boon to Pennsylvania and the other states where natural gas drilling is going on – family sustaining jobs.”

The Marcellus Shale Coalition is a consortium of 300 member companies working to address opportunities in developing America’s natural gas resources, thus pulling the country further away from foreign-based resources. There are three dozen members in the Pennsylvania region.

The MSC serves as a clearinghouse for information to legislators, the media and industry regulators and of course employment. Klaber, a native Pennsylvanian, is its first CEO and she said the industry represents a significant investment not just in the development of a natural resource, but an investment in the community.

“We have a strong partnership with the Greater Philadelphia Chamber of Commerce,” said Shari Williams, Community Outreach Manager for the Marcellus Shale Coalition. “One of the events we’re planning with the African American Chamber of Commerce is a webinar series that will talk about some of the requirements for small businesses and women-owned business so people can start to get on the same page and get the certification to get on the list for the Department of General Services and tap into these opportunities. Another event of interest is that Councilman Kenyatta Johnson is sponsoring an infrastructure forum that will be held at the Navy Yard on March 22. Infrastructure as it relates to Marcellus Shale and how it relates to Philadelphia.”

According to the Coalition, each natural gas well drilled is a monetary investment of between $5 and $7 million. Each well has about 420 people working the site in order to bring the well online. There are presently over 4,500 wells that have been drilled across Pennsylvania alone between 2010 and 2012 representing an investment of $31.5 billion.

But the development and drilling of natural gas, a process called “fraking” met with harsh criticism and protests from environment activists. There was also opposition from different members of the Pennsylvania State Senate and House of Representatives believed that Governor Tom Corbett refused to tax the maximum dollars – called “impact fees” from drilling companies.

Critics of Marcellus Shale drilling proposals stated that across the country, 98 percent of natural gas is produced in states that have drilling taxes or fees. In those states those fees support critical services. Pennsylvania is the largest mineral-rich state in the nation without a drilling tax or fee of any kind. And, according to a recent report released by the Pennsylvania Budget and Policy Center, legislative inaction has allowed over $208 million in revenues to just slip by, money that could have been used to prevent cuts to public education, colleges and health services.

Sen. Vincent Hughes stated in 2011 that the shale tax plan would make Pennsylvania’s rate the 5th lowest effective rate in the country and called the plan a missed opportunity.

Klaber said during the editorial board meeting that since 2006, there have been $1.1 billion in overall taxes paid by the Marcellus industry. Road construction since the same year has reached $500 million and $204 million in impact fees have been paid to Pennsylvania in 2012. In addressing environmental concerns Klaber said the industry is extremely careful in safeguarding the drilling process.

“One of the reason why there is so much pre-testing being done around the Commonwealth is because if someone has a problem with their water – saying there is a problem after the drilling – but the testing of the well shows the exact same problem existed before, well the company still has to provide a short term remedy but not for the life of the home because it was a problem that existed before,” Klaber said. “This has been a long-standing problem in rural Pennsylvania but what’s happened is the activity of the industry has really brought the environmental concerns to the forefront.”

Klaber said the hydraulic fracturing or fraking happens inside a pipe that has four other pipes outside of it and is a mile below the ground. The process doesn’t create any migration of the methane into the shallow areas. If something happens during the process and there is a spill or some other problem then of course there would be seepage. The companies have to manage for that and are held accountable if a well hasn’t been drilled correctly.

“From what I’ve seen over the last three years the vast majority of the water well problems come from the fact that there are existing problems with our water wells in Pennsylvania,” Klaber said. “There are ramifications and there were some problems in Dimock, Pennsylvania but this was because there was no pre-drilling. No one did a before and shame on all of us.”

Residents in the small community of Dimock Township agreed to a settlement with Houston-based Cabot Oil & Gas Corp. after residents claimed the company polluted their water supply with methane gas during drilling in 2009. Cabot denied responsibility and federal environmental regulators tested the aquifer in 2012 and determined the water in Dimock was safe to drink. That determination is still under dispute by the residents of the rural community.

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