Environment DEC
From the October 2008 issue
News on New York Gas and Oil Drilling
Three developments relating to natural gas and oil exploration in New York State were the subject of DEC press releases within the past several weeks: Commissioner Grannis responded to concerns about possible drilling in New York City's watershed; a new web page about the Marcellus Shale Formation was launched, and a report on 2007 gas production was released.
Commissioner Testifies
In testimony prepared for a recent public hearing, DEC Commissioner Pete Grannis advised the New York City Council that natural gas drilling in the city's watershed is not imminent. The commissioner pointed out that DEC is undertaking a full examination of potential environmental impacts of horizontal drilling in what's known as the Marcellus Shale rock formation, including the use of large volumes of water, and encouraged the council members and other interested parties to participate.
No applications have been received for natural gas wells anywhere near New York City's watershed in the Catskill Mountains.
Commissioner Grannis explained that the state has not received any applications for drilling anywhere near the city's watershed in the Catskill Mountain region, and that if any permit applications were received, a full assessment of potential environmental impacts specific to the city's watershed would be required. Grannis told the city council's Environmental Protection Committee that "DEC will not issue a drilling permit if a proposed well threatened the city's or any other locality's watershed, and we will not issue a drilling permit in the future if the proposed well threatens the city's or any other locality's water supply." Given the large amounts of water that will be required for horizontal drilling in the Marcellus Shale, Grannis also said that DEC will be examining issues ranging from water withdrawal and consumption, to the composition of "frac" fluids used to fracture the rock during drilling, to the safe storage, transportation and legal disposal of waste water from drilling operations.
Speculation Led to Emergency Hearing
The "emergency" hearing was called in response to reports speculating that the "filtration avoidance determination"-the legal instrument issued by the U.S. Environmental Protection Agency that allows the city to use unfiltered drinking water-was at risk because of potential natural gas drilling in the portion of the city's watershed located west of the Hudson River. In his testimony, Grannis reminded the city council that the state has been the city's partner in protecting the watershed, and that DEC in particular plays a significant role in ensuring that the city continues to avoid the costly requirement of building a filtration system.
See the Commissioner's Testimony on Natural Gas Drilling in the New York City Drinking Water Watershed for complete text of Grannis' remarks before the city council. Also, see the complete press release on the commissioner's testimony for more details.
Web Page on Marcellus Shale Launched
A map showing the extent of the Marcellus Shale formation in New York can be found on the web page.
As landowners and municipal officials continue to seek information about possible horizontal drilling for natural gas in the Marcellus Shale formation, DEC has launched a new Marcellus Shale web page designed to provide details about drilling processes, leasing, federal and state laws, links to relevant sites, and the upcoming review of potential environmental impacts.
The new page will also include facts about drilling, Marcellus Shale maps and links to other pages, such as the DEC's searchable database for existing oil and gas wells, the Landowner's Guide to Oil and Gas Leasing, the Susquehanna River Basin Commission and the Delaware River Basin Commission (the two entities that regulate water withdrawals in the regions likely to be tapped).
2007 Gas and Oil Production Report
DEC recently reported figures for 2007 gas and oil production in New York State. Natural gas production from New York wells continued at high levels in 2007, although numbers fell just below 2006's record-breaking production figures. Oil production increased 20 percent from the previous year, with a total of 386,887 barrels reported by purchasers, a rise corresponding with growing oil prices.
For 2007, 54.9 billion cubic feet (bcf) of natural gas was produced in the state. That total fell shy of the all-time high, 55.2 bcf, set a year earlier. Still, the 2007 production total represents an increase of slightly more than 50 percent since 2003 (36.0 bcf) and 200 percent since 1996 (18.3 bcf). The 2007 production, which was enough to supply the heating needs of nearly 800,000 homes for a year, was driven by prolific wells in the Trenton-Black River formation in the Finger Lakes region.
For more than a decade, the Trenton-Black River formation has been the state's dominant gas production zone, accounting for 75 percent of total production. In 2007, the Trenton-Black River formation produced 41.3 bcf from only 92 active wells. One well in the formation, the Stoscheck, in Van Etten, Chemung County, produced 3.97 bcf-enough to heat more than 57,000 homes for a year.
Statewide, 12,994 oil and gas wells were in production in 2007. In addition to oil and gas wells, there were 946 underground natural gas storage wells, 147 brine production wells, 83 geothermal wells and 21 stratigraphic wells (used to gather sub-surface core samples).
All oil and gas wells are monitored closely by DEC staff during drilling and operation and on closure.
Total market value of 2007 oil and gas production in New York is estimated at $516 million. Landowners received an estimated $60.75 million in production royalties. Local government taxes on the market value of production were an estimated $15 million. Also, in 2007, the average price of natural gas in New York was $8.85 per thousand cubic feet and the average wellhead price of oil was $78.59 per barrel.
DEC issued 577 well drilling permits in 2007, down from 622 in 2006 but up from 436 in 2005. Of the 577 permits issued in 2007, 386 were issued for natural gas wells, 142 for oil wells, 31 for geothermal wells, 14 for brine production wells, 2 for stratigraphic wells and 2 for underground gas storage wells. Total drilled depth of the wells drilled in 2007 in New York was over 1.4 million feet (about 274 miles, or nearly the same as the drive from Albany to Buffalo). The complete press release on this topic includes a county-by-county gas production table, as well as production trends over the past several years.
More Information
DEC has established strict environmental and safety requirements for natural gas and oil development in New York and is also responsible for preventing waste of these non-renewable natural resources. In addition, DEC protects the ownership rights of landowners affected by energy production.
Additional information on New York's oil and gas resources is available at the Oil and Gas web page on DEC's website. A new online searchable database, New York's Oil and Gas Database, provides information on individual well production, drilling operations, locations and depths, along with information on well ownership, well owners and operators, registered drillers, pluggers and companies that provide financial security instruments.
