Budget limits forest drilling impact
Published: October 13, 2009
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share thisHARRISBURG - The new state budget is supported with $60 million in anticipated revenue from natural gas drilling on state forest lands, but environmentalists claim success in blocking more ambitious plans to open up the forests for drilling.
One of the final compromises reached as part of the $27.8 billion budget package transfers $60 million in gas lease revenue this year to the all-purpose General Fund and maintains the traditional authority of the Department of Conservation and Natural Resources over the lease process.
DCNR will limit drilling on forest land through competitive auctions and plans to use new seismic technology to identify tracts with the largest underground gas deposits, said Gov. Ed Rendell. This will enable the state to get higher bids per acre from drilling companies.
The budget provides $50 million in future royalties from gas production to operation and maintenance of state parks and forests. Both agencies have their funding cut in the new budget.
Earlier budget agreements advanced last month called for $100 million from drilling on forest land; some proposals specified the amount of acreage to be leased.
Those ideas met with strong opposition from a group of House Democratic lawmakers. They revived a push for a state severance tax on natural gas production. Reps. Ed Staback, D-115, Archbald, and John Siptroth, D-189, Smithfield Twp., are vocal members of this group.
There is no severance tax in the new budget, but these House Democrats maintain they achieved a victory by allowing DCNR Secretary John Quigley to decide how much acreage will be leased to reach the $60 million revenue target.
"He (Mr. Quigley) will decide how much land is leased and at what price," said Mr. Staback.
Added Rep. Steve Santarsiero, D-31, Lower Makefield: "Last year, the state received over $160 million in leasing revenue, so the budget deal should not result in significantly greater pressure to lease state lands this year."
About 1.5 million acres of state forest land are in the Marcellus Shale formation, underlying much of Northeast and Northcentral Pennsylvania. Of that acreage, about 600,000 acres are under lease.
Hundreds of thousands of state forest acreage in wild and natural areas, old growth forests, endangered species habitat, prime recreation areas, and "ecotourism" regions like the Poconos and Laurel Highlands are regarded as off-limits to drilling.
DCNR leased 74,000 acres of land for drilling in the Loyalsock, Tioga and Tiadaghton state forests a year ago. The agency also leases land for drilling in the traditional shallow gas and oil fields of northwest Pennsylvania.
To keep pressure off the state forest lands, environmentalists want a severance tax enacted before the next budget comes up for a vote. "We need a severance tax so we can get the state some revenue, wherever they are drilling," said Jan Jarrett, president of PennFuture, a statewide environmental group. "It would take the pressure off from trying to get revenue by leasing public land."
Contact the writer: rswift@timesshamrock.com
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