Thursday, August 29, 2013
NYS COURT OF APPEALS TO REVIEW MIDDDLEFIELD AND DRYDEN DECISIONS August 29, 2013 – Binghamton, NY— “The Joint Landowners Coalition of New York and our 77,000 landowners are ecstatic over the New York State Court of Appeals’ decision to review the lower court rulings in the Middlefield and Dryden cases. These decisions have wreaked havoc in our towns. Local municipalities are simply not equipped to decide issues affecting our state and national interests in producing clean domestic energy. New York cannot have a “not in my back yard approach” to energy development.” Scott Kurkoski, attorney for Jennifer Huntington in the Middlefield case said: “The future of New York’s energy policies and the rights of New York landowners now rests in the hands of the Justices of New York’s highest court. We are hopeful that the Court of Appeals will protect the rights of landowners and allow New York to realize the environmental and economic benefits of natural gas while allowing our nation to maintain its course towards energy independence.”
Tuesday, August 27, 2013
A Missed Opportunity to Highlight Lackawanna College As I highlighted last week, President Obama’s visit to Scranton last week presented an opportunity to discuss the benefits of expanded natural gas production and drilling in the region. On top of that, he was hosted by Lackawanna College – an institution that has embraced the growing natural gas industry and has remolded its own curriculum to meet the workforce needs in the area. The college recently invested over $750,000 to create the School of Petroleum & Natural Gas in New Milford and to give its students the experience required to secure a job in the natural gas industry. The President, while recognizing a worthy institution, missed a great opportunity to link his education innovation theme directly to Lackawanna College and our natural gas energy future. President Obama explained that educational institutions should provide a life skill that will allow its graduates to make a life-sustaining wage and not bury them under debt without an end in sight. I believe strongly that the School of Petroleum & Natural Gas is the epitome of what the President was talking about in providing a solid education that will in turn help graduates gain employment in their career field and pay down any costs occurred from their college education. With the school’s associates degree in petroleum and natural gas technology, the college and its students — which are being placed into natural gas industry jobs at a rate of 90% — underscore the type of leadership and job creation strategies that President is trying to promote. And as the natural gas industry grows, it continues to have a positive impact on the economy around it: spurring job growth in other sectors such as manufacturing. The Northeast Pennsylvania Business Journal recently wrote an article about companies in the Scranton area and how they have been positively impacted by the growth of this industry. All of us at Cabot are proud to produce clean burning, affordable natural gas from right under our feet. And we are even more proud of the thousands of jobs that we are creating for future generations. George Stark Director, External Affairs Cabot Oil & Gas Corporation
Friday, August 16, 2013
To the Editor: Imaginary future audio recording from the Governor's office: 8/30/13, 3:10PM. Andrew Cuomo/Ditherer in Chief (hereafter AC/DC): Gentlemen, I've called this meeting to assess the general situation in New York as far as natural gas and the environmental stuff are concerned. Assembly leader: (hereafter AL) I'm sure I can, and will,speak for all of us in thanking you for this opportunity to contribute to the well being of our highly rated state on this issue. AC/DC: I'm taking a little heat for us being the only state that isn't taking advantage of our shale play - especially from some of my fellow liberal governors - like Jerry in California and my friend in Illinois, and even Governor Rendell! AL: I wouldn't worry about those guys Andy. As long as we can keep Yoko in our camp we should be fine. She is such an authority on the environmental stuff and a great artist to boot! Have you seen her video where she thrusts her abdomen in and out while holding a beach ball and singing " Don't Frack My Mother"! What an artist! We need to keep her, and her wealthy friends, on our side at all costs! Who needs the unions if we can get Yoko? AC/DC: Well, I've always favored Yoko over those robber baron farmers in the Southern Tier. I mean who really believes their song of woe about their poor economic conditions! As I've stated before, surely the increased production of the yogurt industry will be enough to make up for any economic problems the farmers have. AL: Absolutely! AC/DC: I took a little heat about my concern for kids falling into gas wells. I don't see why really. If you took the valve system off the top of a well you could stuff a kid in there - couldn't you? AL: Absolutely! AC/DC: I'm really a little upset at all this belly-aching about all the jobs and economic activity we're missing out on. Our own ads point out how well our state is really doing - don't they? I thought my buddy BHO put the jobs thing in perspective when he said the Keystone Pipeline would only produce 50 jobs! He knows his own people who have put the number up around 20,000 are full of buffalo chips - right? AL: Absolutely! AC/DC: I'm sure all my fellow urban liberals, Democrat and Republican, know more about the real conditions in the rural areas than those hayseeds do! As some of us have stated before, they wouldn't know what to do with the money from gas drilling anyhow! Certainly not like we would! AL: Absolutely! AC/DC: It's probably good we've been able to control any concerns about New York being alone on this stuff. Sometimes I think it sounds a little bad when someone points out that at least 29 states are allowing fracking and at least 16 are allowing horizontal fracking - and I don't think that includes California and Illinois. It is possible, don't you guys think, that everyone else is wrong on this, and we're right? AL: Absolutely! AC/DC: Well, I want to thank you all for coming and contributing so much to this conversation. Yoko and Al Gore have agreed to give me a real education on this stuff in the near future. Can't wait for that day! In the mean time, keep telling everyone you meet what great shape New York is in. We really need to get that message out! Sheldon, if you could stay a minute, I'm sure you'll want to talk a little about this stuff. AL: Absolutely!
Sunday, August 11, 2013
Fracking Nets New Jersey $11.5 Billion Posted on August 6, 2013 by Tom Shepstone Shepstone Management Company, Inc. New Jersey is making out like a bandit on natural gas, achieving consumer savings equal to a 22% state income tax cut – savings that dwarf the gains to oil and gas companies and landowners. Who benefits most by fracking? If you listened to the natural gas opposition or “fractivists” you’d have to conclude it’s those greedy landowners and even greedier oil and gas companies but that’s not the case. No, the greatest beneficiaries of fracking technology are urban consumers of natural gas. A hard look at the data, all available at the Energy Information Administration (EIA) website, indicates just one state’s consumers netted over $11.5 billion dollars of savings from the reduced prices achieved through fracking and the opening up of new shale plays made possible by the technology. It’s New Jersey, giving a whole new meaning to the name of their former basketball team (the New Jersey Nets). New Jersey provides a good test case because, despite being the Garden State, it’s also the most urban state, with a density of 1,189 persons per square mile. Some 74% of homes use natural gas as their heating fuel according to the latest Census statistics: New Jersey is ranked 10th out the 50 states in the amount of natural gas it uses, over 660,000,000 million cubit feet annually, but produces none of it. It is dependent on supplies from the Marcellus Shale and other natural gas regions for its home heating fuel. Several major pipelines deliver that natural gas. These include the Tennesse Gas Pipeline (part of the Kinder Morgan system), for example, which fractivists have fought bitterly as the company has sought to develop the additional capacity to serve New Jersey’s burgeoning demand. Several other pipelines are moving gas from both nearby and far away markets to serve the New York metro area, which includes New Jersey. The availability of nearby natural gas from the Marcellus Shale region, combined with dramatically increased production, both attributable to hydraulic fracturing technology, have lowered prices equally dramatically for New Jersey consumers. The EIA database provides both consumption and price data over time for various classes of consumers, making it possible to calculate the savings to these consumers since fracking, together with horizontal drilling, began in earnest in the Northeast in 2008. Comparing natural gas prices by year with inflation adjusted prices in 2008 when fracking was just taking off in the Northeast indicate New Jersey homeowners and renters have, over the last four years, secured nearly $2.5 billion of savings from what they would have otherwise paid at 2008 prices. The savings are in 2012 dollars (computed using the Consumer Price Index for urban areas) and include estimates of 2012 consumption and pricing based on those months for which data was available. This is just the beginning, though, for more and more of New Jersey electricity is produced using natural New Jersey electric utilities have, over the last four years, saved nearly $4 billion as a result of lowered natural gas prices and increased use, compared to what gas used for electricity generation at 2008 gas prices would have cost. New Jersey commercial gas use Applying the same methodology, commercial and industrial users of natural gas, respectively, saved $2.7 billion and $900 million over the last four years. The following table summarizes for all New Jersey consumers, showing the state saved an estimated $11.5 billion (roughly $2.9 billion per year) from development of new natural gas sources; all accomplished using fracking and horizontal drilling technology in the adjacent Marcellus Shale region and elsewhere. The New Jersey state budget indicates taxpayers were, in 2013, expected to pay about $13.3 billion in corporate and personal income taxes. These savings from natural gas, therefore, are akin to a 22% tax cut for these businesses and individuals. It doesn’t get much better than that. Just imagine where New Jersey would have been without these savings during the economic recession that has plagued the country over the entire period. Now, for some further perspective, consider how the oil and gas companies are doing. Several are experiencing increased profits as a consequence of lowering costs through better application of technology, enabling them to prosper even with the new low prices fracking and horizontal drilling have delivered. New Jersey consumed a total of 660 billion cubic of natural gas in 2012, approximately 1.8 billion cubic feet per day. Two companies combined, Cabot Oil & Gas and EQT, produced roughly the same amount in 2012 and enjoyed combined operating incomes of $264 million that year, roughly 9% of what New Jersey consumers netted. New Jersey consumer savings also dwarf the royalties paid to landowners. Pennsylvania produced 6.1 billion cubic feet of gas in 2012, more than three times the amount New Jersey consumed. Pennsylvania landowners received $731 million in Marcellus Shale royalties paid in 2012, a handsome amount to be sure, but this suggests the New Jersey natural gas usage might generate $231 million annually in royalties. Once again, this amounts to only 8% of what New Jersey consumers netted. This data shows neither landowners nor oil and gas companies have been greedy. Both have done about as well as most reasonable people would say is only fair. Those New Jersey folks sure have done well, though. And, their legislature actually wanted to ban on fracking (turned into a moratorium by Christie)! Never let it be said that politicians will act in the public interest when self-interest in being politically correct intrudes. Still, those of us who have been around know people ultimately vote with their pocketbooks, especially when the opposition consists of nothing more than “crying wolf.” I suspect New Jersey folks are a little tired of that game and are not going to forgo what is, effectively, a 22% tax cut. Then again, they lost the New Jersey Nets, which are now the Brooklyn Nets