Corbett cheers natural gas drilling

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When it comes to natural gas, the most interesting items in Gov. Corbett's budget proposal were the ones that weren't there: No severance tax on drilling companies. And no indication that the governor intends to lease more state forest for drilling.

But he did say it's time for the state to embrace drilling. "Let's make Pennsylvania the Texas of the natural gas boom," he said in his budget address. "I'm determined that Pennsylvania not lose this moment. We have the chance ... to get it right the first time, the chance to grow our way out of hard days."

The absence of a tax was expected. Mr. Corbett has said all along he would not support it.

But the reprieve for state forests was a surprise and, for many, a relief.

"The governor is to be commended. He showed restraint," said John Quigley, secretary of the Department of Conservation and Natural Resources for former Gov. Ed Rendell. The DCNR oversees state forests.

Of the 2.1 million acres of state forest, roughly 75,000 have been leased. A DCNR report concluded that additional leasing would compromise ecological integrity of the lands, and Mr. Quigley said more leasing would jeopardize the forests' sustainability certification, a designation that contributes to 9,000 forestry jobs and a premium price for timber.

But Mr. Quigley also noted that a portion of the department's budget would be funded by proceeds from leases and royalties, which essentially makes the DCNR beholden to an industry it must monitor.

"In the long run, it is not the best course," Mr. Quigley said. The money was originally intended to be reinvested for conservation, recreation and flood control, he said.

State Rep. Greg Vitali, D-Delaware, also was relieved, "but we certainly have to stay vigilant," he said. "This could be inserted at a later date."

He will introduce legislation today -- identical to that passed last year by the House -- imposing a three-year moratorium on state forest leases, then allowing leasing based on sustainability, not the agency's need for funds.

Jan Jarrett, president of PennFuture, the environmental advocacy group, called the absence of forest leasing the budget's "one bright spot."

As for the lack of a severance tax, she said that "there is no sane argument to let drillers off the hook."

Mr. Corbett has said a fee or tax would scare industry away. "What Pennsylvanians will gain is the jobs, the spinoffs," he said Tuesday.

But others noted that Pennsylvania remains the only major gas-producing state without a tax. Mr. Vitali said a tax similar to West Virginia's could generate $200 million a year, "and that could save a lot of programs."

Across the aisle, Erik Arneson, spokesman for Sen. Dominic Pileggi, R-Delaware, said the senator, while "respectful of the governor's position, believes there is room for a reasonable and competitive assessment."

While the Marcellus Shale Coalition, an industry group, did not specifically address Mr. Corbett's budget proposal, president Kathryn Klaber said, "we have to get this historic opportunity right, and we applaud Gov. Corbett for his continued leadership."

Correction/Clarification: (Published March 10, 2011) The state has leased 700,000 acres of its forestland to Marcellus Shale gas drillers. An incorrect number was given in a story Wednesday


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