LOCK HAVEN - The Clinton County Natural Gas Task Force juggled a large number of issues Tuesday evening as its members received a myriad of committee reports and struggled to respond to what is expected to be a rapidly growing industry in this region.
Right now, the gas drilling industry is in its infancy, but if a common theme emerged last night, it's that Sonny Boy is growing up fast.
Perhaps it was recent word that an "anchor business," Trican Well Services Ltd., is looking to hire employees as it locates in a 64,000 square-foot building on 12 acres behind the Central Pennsylvania Auto Auction at the Route 220-Interstate 80 intersection in Lamar Township.
Or maybe it was the large map of Clinton County hanging on the wall of the meeting room at the Garden Building, showing the permitted drilling sites in the area and the companies involved in those operations.
Maybe it was word from Wayne Township Landfill Director Jay Alexander that the Clinton County Solid Waste Authority has doubled its business this year and is turning away customers.
Whatever the reason, there appeared to be more of a sense of urgency attached to this session when compared to meetings past.
Reports arrived and were given in quick succession as a number of experts in the field, and experts-to-be, offered opinions, facts and anecdotes surrounding this thing called Marcellus Shale, a layer of natural gas laden rock beneath much of central Pennsylvania.
Several years ago, very few of these geologists were excited about the Marcellus Shale as a major source of natural gas. Wells drilled through it produced some gas but rarely in enormous quantity. Few, if any, in the natural gas industry suspected that the Marcellus might soon be a major contributor to the natural gas supply of the United States - large enough to be spoken of as a "super giant" gas field.
Today, that's all changed.
Estimates by Penn State University experts suggest the Marcellus might contain more than 500 trillion cubic feet of natural gas. Using some of the same horizontal drilling and hydraulic fracturing methods previously applied in the Barnett Shale of Texas, perhaps 10 percent of that gas (50 trillion cubic feet) might be recoverable. That volume of natural gas would be enough to supply the entire United States for about two years and have a wellhead value of about $1 trillion.
Big money and potentially, big employment, big stakes, big opportunities for local companies and big headaches for local governments.
If there was a second central theme to the meeting, it was this: How do local officials respond? How do they balance the possibility of economic growth with the need to protect the environment and preserve quality of life?
The reports from the various committees:
ENVIRONMENT
Gerry Lacy, system manager of the South Renovo Water Department, said his committee is recommending Sproul District Forester Doug D'Amore be enlisted to participate in environmental discussions. He noted a great deal of the activity attached to the drilling industry has occurred and will occur in Sproul State Forest, and said the D'Amore's familiarity with forest issues and drilling activity could make him a very valuable task force resource.
The committee also reviewed proposed changes to the county zoning ordinance, including sections that will require limits on sound generated by compressor/pump stations used to send the natural gas on its way to larger transmission lines.
EDUCATION
Richard Kyle, a local businessman and ex-commissioner, said the task force's Public Education sub-committee will develop a series of articles to appear weekly in The Express to outline details of the industry, present facts about the technology and offer "balanced, educational fact-based" information. He said radio programs also will occur on a weekly basis for the next six weeks.
Kyle also said some steps have been taken to hold a "meet and greet" between industry representatives and local business leaders to see if a dialogue on business and other opportunities will open up. That session will probably occur in January or February under sponsorship of the Clinton County Economic Partnership.
Plans are also being made to hold a public forum, perhaps at Lock Haven University, to offer more information on the situation in the guise of "Marcellus 101."
DEVELOPMENT
Mike Flanagan, CEO of the Clinton County Economic Partnership, said his agency has developed a list of 18 to 20 potential sites industry-supporting businesses might be interested in, including those suitable for warehousing of supplies, properties with rail access and others with desired utility or infrastructure enhancements.
He also noted the Partnership will join with Renovo Rail Co. and the solid waste authority to establish a booth at an upcoming natural gas industry fair in Tioga County.
Flanagan said the Partnership is also working with Trican to deal with infrastructure needs at its site, and representatives of the company were out at that location this week to investigation the situation.
County Commissioner Adam Coleman, task force chairman, suggested a list be compiled of local businesses that might be of service to the industry, and Flanagan mentioned that the Partnership provides a copy of its extensive business directory to any company official who makes inquiries.
SAFETY
Director of Emergency Services Kevin Fanning said his agency has assigned addresses to 58 drilling or industry sites in the county to better identify locations and routes for emergency responders.
Fanning also reported on a number of learning opportunities for emergency personnel, one of which was offered by the firm Wild Well Control.
"I had the opportunity to work with them during a well blow out in Leidy Township two years ago, and they are a class organization," he said, adding about 50 county residents attended those training sessions in Lycoming County.
Another firm, Range Resources, has offered opportunities for firefighters and emergency workers to visit rigs and familiarize themselves with the equipment and hazards they might face during an emergency, he said.
Weavertown Environmental has located a subsidiary headquarters manned by two people in McElhattan, he said, so the response time for dealing with spills should be decreased to a degree.
Unfortunately, he added, it takes specialized equipment to deal with a well fire, and the resources are limited in Central Pennsylvania because most of the major companies dealing with those situations are located in Texas. One company has a front organization to start the process if an outbreak occurs, Fanning said, but it will still take a significant amount of time to draw the necessary equipment and trained operators from other regions.
Fanning also noted some area emergency units are worried the call volume is going to increase, adding to the local cost of operations while drawing away from fund raising opportunities.
Local officials might revisit a policy established several years ago that offered fire companies and ambulance crews an opportunity to recover costs by billing their services to the private firms they serve during emergencies.
WORKFORCE
CareerLink Director Bruce Jones said Trican has already contacted the local job services office and is using its space to conduct interviews, while actively soliciting prospective employees via the CareerLink Web site.
Right now, he said, the company is primarily seeking CDL-certified truck drivers with good records, but he expects other job descriptions to be listed in the near future.
"It's good to have them here," he added.
In a related report, Keystone Central School District Career and Technical Education Director Scott Owens said he has contacted industry officials and been told they prefer to train new employees themselves rather than relying on the educational system to provide specific skill sets.
"I've asked them again and again what they need, and they always reply, 'good workers with work habits, clean of drugs.' It's frustrating because we want to do what we can to prepare our students," he said.
Owens said the district has recognized the increased demand for people with commercial driver's licenses and will offer classes in that category, while offering new training on a quarterly basis.
TRANSPORTATION
Wes Carson, manager of the PennDOT's county operations, commended Anadarko specifically for its quick response to road repair concerns raised in the past year.
"We've received great cooperation," he said, noting the damaged section of Route 664 has been improved after heavy truck traffic contributed to some deterioration in that area.
Carson also said state police have responded to complaints and are conducting random weight tests on some of the region's road.
On Little Plum Run Road from Woolrich to Coudersport Pike, on one day alone, a company was fined $15,000 for overweight vehicles or failure to hold a valid permit for bonded roads, he said.
Carson also noted several major accidents occurring in recent months in connection with large drilling vehicles traveling on rural highways. On Route 664, a rig hauling pipe and a pick-up truck went off the road and the driver was entrapped in his vehicle for several hours, and on Route 144, a large tanker truck hauling diesel fuel rolled over and leaked about 2,200 gallons, he said.
REGULATION
State Department of Environmental Protection Community Revitalization Consultant Dan Vilello, also a former county commissioner, noted there are 29 new "oil and gas" people on board at DEP's Williamsport office, which covers the 14-county northcentral region including Clinton. Unfortunately, while the pace has picked up for regulating the drilling industry, funding cutbacks have forced reductions in other areas, he said. In some cases, he said, experts in water quality or some other category of DEP governing have transferred to the oil and gas regulation classification, and those vacancies aren't being filled because of the state's austerity measures.
"We're taking a hammer on other programs but we're doing more inspections," Vilello said. The extra work has paid off, he added, as violations of erosion and sedimentation regulations have dropped off significantly because of the fines assessed for those infractions.
"The companies are getting the message," he said.
Vilello also said a couple of companies have asked for permits to drill into layers deeper than the Marcellus Shale reserves, suggesting a second wave of speculation could occur even as the first wave has barely seen its growth.
The comment had one attendee worrying about how local government might struggle to respond to rapidly changing technology and new discoveries, while harkening back to the days when the coal and clay industries left damaged properties abandoned after draining the natural resources.
LANDFILL
Wayne Township Landfill Manager Jay Alexander said the landfill has seen huge increase in business due to the surge in drilling for natural gas - as much as a doubling of business, in fact.
The landfill's normal $9 million annual income has jumped to over $13 million for 2010, he confirmed.
The facility accepts "clean rock" from the initial drilling process.
"It's getting stretched," he said. "We turn away people on a daily basis."
Alexander said he anticipates the authority will receive a new permit adding some 20 years to the capacity of the landfill. The landfill has about five years of life remaining at its present, 33-acre fill site south of Route 220 near McElhattan.
As a result of increase in business, under their host agreements, the county will receive close to $1 million this year as compared to the normal allocation of $450,000, while Wayne Township, which receives $187,000 in a normal year, is expected to rake in over $400,000.
Alexander said other fees, like the $4.25-per-ton Growing Greener assessment, are attached to deliveries, but while these are designated for environmental improvements by the state, "they are robbed into the general fund."
That comment was attached his general view that, if a statewide "severance tax" is attached to drilling operations, the money should go back to the counties that see the impact of the drilling to cover costs to local communities.
