Why veto the moratorium? Even though tens of thousands of citizens lobbied for a moratorium on hydro-fracking, Paterson expressed concern that the bill went too far.
The moratorium bill, as written, would halt issuing permits for wells using “hydraulic fracturing for the purpose of stimulating natural gas or oil in low permeability natural gas reservoirs, such as the Marcellus and Utica shale formations.”
That included vertical wells and, depending on how one interprets “low permeability”, might have halted drilling in other strata. Convinced by industry that too many jobs would be lost – some 5,000 – the guv vetoed the bill.
Paterson made industry happy. “We are very pleased that the governor saw the bill for what it was – a flawed piece of legislation replete with unintended and dire consequences for the people and businesses in our industry,” said Brad Gill, executive director of the Independent Oil and Gas Association of NY (IOGA-NY).
New York Farm Bureau actively opposed the moratorium too, posting an “action alert” on their website. Within a week close to 600 people sent anti-moratorium letters to the governor from the NYFB’s site.
Landowners had reason to cheer as well. Ever since Paterson directed DEC to develop a Supplemental Generic Environmental Impact Statement (SGEIS), Chesapeake and Fortuna have threatened to invoke “force majeure” in order to extend their leases.
A force majeure clause in a lease allows the terms of a lease to be extended under unforeseen circumstances. It was intended to protect a contractor who cannot complete his project given such things as hurricanes or union strikes. But the gas industry argues that being prevented from drilling horizontal fracked wells in Marcellus – even though they can drill vertically or exploit other strata – is stopping them from doing business.
Landowners worried that a moratorium would indeed justify the industry’s force majeure argument.
Paterson also made the environmental community happy. “He’s given us more time to evaluate the critical issue of high-volume horizontal hydro-fracking,” said Katherine Nadeau of Environmental Advocates of NY.
Assemblywoman Barbara Lifton explained that an Executive Order, no matter how good, is second best to legislation. A statute, she points out, would not fact the risk of being rescinded by Governor Cuomo when he takes office.
“There was also a lot of misinformation from the industry,” Lifton said. Regardless of how safe people insist the current drilling technology is, there are problems with vertical wells. That’s why the moratorium included vertical wells, Lifton said. Indeed, it was vertical Marcellus wells that contaminated the drinking water wells in Dimock, PA.
What does the Executive Order really say? Not much, when you really read it.
In comments prepared for the press the Governor emphasized that before drilling requiring high-volume horizontal hydro-fracking begins, there must be absolutely no doubt that the technique is safe.
“The enormous revenues that could eventuate from such drilling would not be worth the cost of serious environmental harm,” Paterson said. He added that he wants DEC to examine all available evidence, including data from other states.
To that end, Paterson directed DEC to:
- Complete its review of public comments and revise the draft SGEIS in a way that comprehensively analyzes the environmental impacts associated with high-volume hydraulic fracturing combined with horizontal drilling and ensures that such impacts are appropriately avoided or mitigated;
- Ensure that that adequate regulatory measures are identified to protect public health and the environment;
- Publish a Revised Draft SGEIS on or about June 1, 2011;
- Accept public comment on the revisions for a period of not less than thirty days;
- Consider scheduling public hearings on such revisions in the Marcellus shale region and New York City;
- Continue prohibiting permits for high-volume horizontal hydro-fracking until the completion of a Final SGEIS.