A new report – available here – from the Allegheny Institute for Public Policy underscores the clear fact that safe, tightly-regulated Marcellus Shale development has “produced major economic benefits to the Commonwealth of Pennsylvania.” According the report, estimated royalties paid to Marcellus Shale natural gas land- and mineral-owners in Pennsylvania reached a staggering $731 million in 2012. And as reported by the Pittsburgh Business Times, under the headline “Marcellus royalties rising,” these payments account for “0.13 percent of estimated [Pa.] personal income,” up from 0.002 percent in 2008.

From more supply chain-related jobs, to more than $400 million in impact fees – in addition to hundreds of millions in generated taxes – distributed across the entire Commonwealth, the safe development of clean-burning natural gas is Powering an American Renaissance while positively reshaping our economic landscape. It’s easy to see why so many are bullish on this historic opportunity.

Here are key findings from the new report:

  • From 2006, (pre-drilling) until 2010…the overall number of income tax returns in Pennsylvania showing rent and royalty income claimed under the section “rents, royalties, patents, and copyrights” climbed by 19 percent.
  • For the counties with the greatest activity…the rise in returns has been the largest. Susquehanna (up 192 percent), Sullivan (180 percent), Wyoming (165 percent), Bradford (145 percent) and Tioga (129 percent) had the biggest gains while the rest of the top ten counties in terms of jumps in returns with royalties, posted a gain of at least 45 percent.
  • Statewide royalty income rose 61 percent from 2006 to 2010 with an increase of 119 percent in counties with Marcellus Shale drilling activity.
  • Northern tier counties Susquehanna, Sullivan, and Tioga each had huge jumps of more than one thousand percent. In Susquehanna the amount claimed in 2006 was $8 million and by 2010 it had topped $133 million—a gain of over 1,500 percent.
  • In fact the top ten counties in terms of growth, seven in the northern tier and Greene, Washington, and Butler counties in the Pittsburgh area, all reported rent and royalty income increases of at least 200 percent.
  • In our 2011 report we examined the seven county Pittsburgh metro areas which, from 2006 to 2008, had an average increase of 50 percent in this taxable income category. The updated data, now covering the 2010 tax year, shows the average rise to be 107 percent led by Washington County’s increase of 289 percent (up from 113 in the original study) and Butler County’s increase of 201 percent (up from 57).
  • The estimated gas revenues for 2012 are in excess of $5.85 billion…using 12.5 percent as the royalty percentage gives an estimated $731 million in royalties for 2012. Thus royalty income paid to owners of land/mineral rights in Pennsylvania skyrocketed by more than 6,600 percent thanks to Marcellus Shale.
  • The BEA’s estimate of personal income for 2012 was just above $556.7 billion, so royalty payments from Marcellus Shale accounts for about 0.13 percent of that income.
  • Royalty incomes in the counties where drilling and production activity are heaviest are certainly having a measurable effect on the county’s total income.

Have natural gas-related questions? Please visit LearnAboutShale.org for fact-based information. And follow us on Twitter (@MarcellusGas) and like our Facebook page for daily updates.