When applying for a permit, companies must list sources and locations of water, whether from a well, stream or public system, and receive permission from the appropriate river basin commission to use it, Hanger said. They must also identify where water will be treated and disposed of.
The companies must disclose the names of all chemicals stored at the drilling site, as well as keep a plan in the event of their release on file with DEP and local emergency responders, Hanger said.
Sen. Mary Jo White, R-Franklin, Venango County, fears gas companies will seek sites in other states if Pennsylvania lawmakers place too many regulations on natural gas operations. She said she ran for the Senate because she was angry at the state for over-regulating the industry, and is concerned the permit process is so complex it will discourage drilling.
"We have to find appropriate balances here, especially protecting water," Hanger said. "On the other hand, imposing any cost does impact the ability of industry to operate here."
EXCO-Northeast President Wendy Straatman estimates Marcellus Shale producers have poured more than $2 billion in leases alone.
"These land leases represent the tip of the iceberg compared to what we as an industry are prepared to invest in Pennsylvania," she said. "However, the uncertain regulatory and legislative environment, including permitting delays unlike any we've ever seen in other states, forced us to put these investments on hold."
Straatman asked why she
should spend so much time filling out a 20-page permit application, when it is easier to move her company's rigs to West Virginia. She urged legislators to proceed cautiously during the early stages of Marcellus Shale development, especially in regards to regulation and taxes.
But municipal and school district officials, faced with rising costs and falling revenue, want legislation to tax gas and oil production. They have been unable to do so since 2002, said Dan Fisher, superintendent of Centre County's Bald Eagle Area School District.
"Pennsylvania stands alone in not taxing the production of natural gas," he said.
Imposing a tax on gas production could be a meaningful way of reforming property taxes, according to Fisher and Tim Allwein of the Pennsylvania School Boards Association.
Many of the poorest school districts are located in the Marcellus Shale region, and revenue from natural gas would provide them with an alternate source of funding, Allwein said.
He admitted the state needs to be careful, noting, "we don't want to kill the golden goose."
Texas has a 7.5 percent tax on natural gas production -- but that doesn't scare companies away, according to Will Brackett, managing editor of the weekly Powell Barnett Shale newsletter. Unlike Pennsylvania, which has higher business taxes, Texas is a low-tax state; it doesn't even have an income tax.
eskrapits@citizensvoice.com, 570-821-2072
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