The Tribune Democrat, Johnstown, PA

October 26, 2012

Gas wells spewing dividends

Jobs among payoffs from Marcellus Shale

The Tribune-Democrat

— It’s great to see our region’s local and county governments reaping promised financial benefits of the Marcellus Shale gas industry.

As reported last week by our Kathy Mellott, Cambria County will receive more than $166,000 this year, with Somerset County securing nearly $181,000.

Checks should be received by the end of the month, the state Public Utility Commission says.

Each of the 63 townships and boroughs in Cambria County and the 50 in Somerset County will receive some money from the impact fee, though the amount will be minimal for the smallest municipalities that host no Marcellus wells.

“I am tickled pink that we are at $166,000. We initially thought it would be less than $50,000,” Cambria County President Commissioner Douglas Lengenfelder told Mellott.

Certainly, many environmentalists and others have fought the Marcellus industry from the outset, with a primary benefit being closer state department tabs on controversial drilling operations and procedures.

Economically, there have been rewards in addition to last week’s impact fee announcement.

The state Department of Labor and Industry says more than 218,000 people statewide are employed in Marcellus Shale and related industries – representing nearly 3 percent of the state’s work force. Of those, nearly 72,000 new hires have been made into Marcellus jobs since the end of 2009.

The industry has been an economic boom to several areas, including an already-growing Washington County, while in 2011 the Williamsport Metropolitan Statistical Area showed a gross domestic product growth rate of 7.8 percent, the seventh-highest in the nation out of 366 MSAs.

The Marcellus Shale Coalition website reports that:

* Companies engaged in and related to natural gas drilling have paid more than $1.6 billion in state taxes since 2006.

* More than 50,000 landowners annually are collecting royalty checks ($400 million in 2011).

The PUC last week said the money paid by the oil companies over the past several months is being distributed based on a per-well formula outlined in Act 13 and adopted by the state Legislature in February.

The companies paid in more than $204 million, about $14 million above initial estimates, a PUC spokeswoman said.

The impact fee law stipulates that $25.5 million go toward statewide conservation and environmental initiatives.

Of the remaining nearly $180 million, 60 percent goes to local governments and counties with Marcellus wells.

The rest is split by nonwell host counties based on population and proximity to the wells.

Lengenfelder told Mellott that Cambria County has discussed spending the money on improvements to Route 219 north in the Carrolltown area. Also on the table, he said, are other bridge and highway jobs.

Meanwhile, Somerset County’s minority Commissioner Joe Betta said he will try to have the county’s share designated for areas affected by the industry.

“We haven’t decided it yet, but I want to see it cover any negative impact in Somerset County as a result of the drilling,” he said.

Whether or not you agree with the Marcellus Shale industry, it has paid major dividends – including in family-sustaining jobs – for our region with promises of even better things to come. It is also moving us toward becoming more energy independent.

We continue to urge our state and local governments to work with the Marcellus Shale industry to allow drilling in an environmentally safe, friendly and well-monitored atmosphere.

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