Oil and gas industry executives will testify alongside government officials today on the future of Pennsylvania's Marcellus Shale natural gas field, the potentially lucrative and largely untapped reservoir of fuel that lies a mile or more beneath the Appalachian topsoil.
Gas drilling companies say Pennsylvania's permitting process is too time-consuming, with regulations that are too complex, meaning the energy companies that were willing to speculate on the predicted gas boom are shifting capital resources elsewhere, especially now that credit is so scarce.
The credit crunch has "forced all companies to live within cash flow," which wasn't the case a year ago, said Matt Pitzarella, spokesman for Range Resources LLC, a Texas-based energy company with offices in Washington County. "That's really cut into the amount of dollars that can be invested."
Mr. Pitzarella's boss, Range Resources Vice President Ray Walker, is scheduled to testify today, as is acting Department of Environmental Protection Secretary John Hanger. At the last Marcellus Shale hearing, before the House Environmental Resources and Energy Committee, Mr. Hanger said the massive gas field -- which could yield up to 150 trillion cubic feet of natural gas -- "could lead to billions of dollars in new economic investment for Pennsylvania's communities, as well as tens of thousands of new jobs."
But that doesn't mean that the DEP has immediate plans to relax its drilling regulations, or appreciably speed up the permitting process. DEP spokesman Tom Rathbun said industry advocates often reference the permitting efficiency of Texas and Louisiana, "where you can apply for a permit in the morning and be drilling by the end of the day."
"Well, we're not Texas," he said. He also said Marcellus Shale permits make up only a small portion of the DEP's workload -- of the nearly 7,000 oil and gas permits issues so far in 2008, only 328 have been for Marcellus Shale gas retrieval.
"We're not holding anyone up," Mr. Rathburn said. "These rules are not onerous." Permits are generally approved within 45 days, if the applications are completed correctly, he said.
The Pennsylvania Economy League of Southwestern Pennsylvania issued a report yesterday emphasizing that oil and gas drilling is a historically important component of the state economy. Its importance could grow if Pennsylvania takes advantage of the Marcellus Shale field, said Kathryn Klaber, executive director of the economy league.
She notes that the subterranean gas field extends to Ohio, West Virginia and New York, all of which are competing for jobs and drilling royalties.
"The place that gets it right, in terms of being welcome, [will] reap the economic benefits," she said.
The Senate Majority Policy Committee plans to meet today at 2 p.m. at Misericordia University in Dallas, Pa., near Wilkes-Barre, to discuss the gas field.