Natural gas exploration has become a modern-day gold rush, spurring development across the United States. The Marcellus Shale, which underlies two-third of Pennsylvania, is believed to be the largest shale formation in the world.
Pennsylvania is positioned to surpass Texas as the Nation’s leader in gas production. Despite one of the worst recessions in years, the natural gas industry is growing, creating high-paying jobs, and making rural landowners millionaires virtually overnight. Penn State economists estimate Marcellus Shale activity will create 111,000 jobs and contribute $987 million in tax revenue to the state by next year.
Unfortunately, environmental extremist and special interest groups are fighting to stop and/or tax the development of this clean, safe fossil fuel. Environmentalist like George Soros, who have investments in renewable energy projects, have financed assaults against natural gas. And for good reason, as energy from wind and solar can only become competitive if traditional energy supplies diminish or become overly expensive.
A Penn State survey showed that support for drilling is highest in places where drilling is actually occurring. That’s because the gas industry is investing in local communities and rebuilding local infrastructure, putting millions into repairing and even improving local roads.
Many groups that rely on taxpayer funding are pushing for a new tax on natural gas in Pennsylvania, and using environmental concerns to justify such a tax. But the state already has the resources and ability to monitor drilling. Natural gas drillers must comply with eight federal and eleven state acts and laws, and are subject to frequent inspections by the state Department of Environmental Protection (DEP). Pennsylvania now employs 193 drill site inspectors; no state comes close to having a comparable number of oil and gas staff.
While a natural gas severance tax—which would distribute the tax revenue to a variety of special interests and politician’s pork projects—was forestalled this year, the future friendliness of the state to drilling will, in large part, be determined by election results. Pennsylvania and other states should seize this opportunity to stimulate the economy with this valuable natural resource.
To learn more about drilling in Pennsylvania, check out the Commonwealth Foundation’s new video series, Know the Drill: The Truth About Natural Gas, where we talk with residents, business, and local government officials in the heart of the Marcellus Shale gas boom and see what they have to say about drilling’s impact on the community, economy, environment, and the proposed severance tax.
Katrina Currie works for the Common Wealth Foundation on energy issues.