NATURAL GAS:

Obama admin rejects timeout for Marcellus drilling

The Obama administration has decided against pressing for a temporary halt to Marcellus Shale drilling in Pennsylvania and New York, a key federal official said.

Brig. Gen. Peter "Duke" DeLuca, commander of the North Atlantic Division of the Army Corps of Engineers, last week declined a request from Rep. Maurice Hinchey (D-N.Y.) to use the federal government's vote on the Delaware River Basin Commission (DRBC) to seek a temporary ban on gas production in the Delaware watershed.

Hinchey wants drilling there to wait until the commission completes a "cumulative impact statement," but DeLuca said that could delay drilling for years.

"The citizens of the basin are counting on the commission to make smart choices that allow for environmental protection to proceed together with economic development," DeLuca wrote in the Sept. 14 letter.

The letter was written a day before Lt. Col. Philip Secrist, representing DeLuca and the Obama administration on the commission, voted to continue limited exploratory drilling in the basin. The vote denied a request by environmental groups seeking to block the drilling of test wells that were "grandfathered in" when the commission imposed a de facto moratorium.

Hinchey, a member of the powerful House Appropriations Committee, is seeking $1 million for the DRBC to study the cumulative effects of drilling in the basin, which provides drinking water to 5 percent of the country's population (Greenwire, Sept. 13).

Cash for the study has been set aside in the House Interior Appropriations bill, which has not been passed in the Senate. But the spending bill is not likely to be approved before November, because Congress is expected to pass a stopgap "continuing resolution" before leaving Washington to campaign, rather than finish its work on spending bills. And there is no concrete plan for passing the measure after the November election.

Hinchey wrote DeLuca on Sept. 9, saying he was alarmed that the DRBC is preparing to finish regulations -- which would allow production to start -- this year, before a cumulative impact study could even start. He asked DeLuca to use his seat on the commission to advocate for blocking development until after the study is done.

"It is difficult to understand how the DRBC can consider the release of gas drilling regulations without a comprehensive assessment of the possible impacts in the Delaware River Basin," Hinchey wrote.

DeLuca said such a study could take years, even if completed promptly.

"The federal family of agencies that I represent on the commission are collectively charged with a requirement to support the economic needs of the region and our nation's need to secure energy reserves while protecting the environment," DeLuca wrote.

Hinchey targets, industry defends Army Corps

The Army Corps represents the federal government on the commission, which also includes representatives of the governors of four states, Delaware, New Jersey, New York and Pennsylvania. The federal-state hybrid was created in 1961 to address regional water conflicts, and oversees water quality and quantity issues in the 13,539-square-mile basin.

At the Sept. 15 meeting, the corps' Secrist pointedly noted that he was "representing President Obama" on the commission.

Hinchey, however, aimed his criticism at DeLuca and the corps rather than the Democratic administration.

"The response is deeply troubling and raises a lot of questions about how the ACOE [Army Corps of Engineers] views its role as the federal government's representative to the DRBC," Hinchey spokesman Mike Morosi said in an e-mailed statement. "The congressman will be following up on this matter shortly."

Environmentalists say DeLuca is wrong when he asserts that the DRBC must balance environmental concerns with economic development. Jill Wiener, a leader of an upstate New York group called Catskills Citizens for Safe Energy, said the commission's mandate is to protect water quality.

"They owe their fealty to the river and the people of the basin," Wiener said, "not the economic health of a few leaseholders and multinational corporations."

But industry officials say DeLuca was correct to reject Hinchey's request.

"Just to be clear here, Hinchey was trying to use a federal agency to direct the actions of a regional water board for the purposes of preventing the development of natural gas in a state where he doesn't even live," said Chris Tucker, spokesman for Energy in Depth, a group of independent drillers. "Next thing you know, he'll be ordering the Army Corps to build levees around our well sites in Wyoming."

DRBC Executive Director Carol Collier stalled the eastward march of gas rigs across Pennsylvania last year when she asserted jurisdiction over Marcellus Shale drilling and said no production permits would be issued until regulations are complete.

That has upset natural gas producers like Hess Corp. and Newfield Exploration Co., along with landowners expecting money for leasing their land to the companies(Land Letter, July 8).

Environmentalists have cheered the moratorium on production but are fighting the DRBC decision to allow exploratory wells.

Is N.J. pressing for drilling?

Gas companies say the gas in the Marcellus Shale formation under Pennsylvania, New York and adjacent states could power the country for years and allow a switch from coal to a cleaner-burning fuel. Many farmers have reaped big windfalls by allowing drilling on and under their land.

But drilling has contaminated creeks and ruined the water wells of homes near well sites. New York and Philadelphia have rallied against drilling, out of concern it could contaminate their water supply.

Hundreds of people attended U.S. EPA hearings this summer in Pennsylvania and New York on "hydraulic fracturing," an essential process for drilling in shale that involves injecting millions of gallons of chemical-laced water thousands of feet underground. Most of those testifying called it a dangerous process that needs federal regulation. The industry says it is an established, safe technology.

Environmentalists have also said that New Jersey Gov. Chris Christie (R) is pressuring the DRBC to speed up drilling in Pennsylvania, despite worries about upstream water contamination (Greenwire, Sept. 16).

Christie's Department of Environmental Protection Commissioner Bob Martin wrote a letter in July urging the DRBC to enact its drilling regulations by the end of September (the DRBC now says a draft proposal won't be ready until next month, with a goal of finalizing by the end of the year). It also said that the DRBC should cede its authority over natural gas development to Pennsylvania once it develops water quality regulations.

But Martin says he was just trying to get the regulatory process moving.

"New Jersey is not trying to expedite drilling," Martin said in an interview this week. "What we're trying to do is avoid duplication."