The Marcellus Shale

The start-up investigative news Web site ProPublica has run two articles recently highlighting what it portrays as the environmental risks of obtaining natural gas from the Marcellus Shale, a vast underground reserve of rock rich in natural gas that has recently been discovered in upstate New York. We reprinted one of the ProPublica* dispatches on our front page earlier this week, reporting that the city's commissioner of environmental protection, Emily Lloyd, had written the state government warning that the drilling could adversely affect the quality of the city's drinking water, which flows from upstate reservoirs. It's a newsworthy controversy.

No energy source is without some environmental risks, and it would be logical to take what measures can abate or minimize them in the case of the Marcellus Shale. What strikes us is that, the nervous Nellies quoted by ProPublica aside, the Marcellus Shale represents an enormous economic and national security opportunity for New York. From a broad policy standpoint, the right move for city and state officials in respect of it is to facilitate the resource extraction rather than retard it.

The economic consequences for New York would be immense. Campaigning for governor in 2006, Eliot Spitzer likened the "devastated" upstate economy to that of Appalachia, and a New York Times article about the comment at the time reported that Appalachia had actually been doing better at job creation. And that was before the latest downturn in the housing and credit markets. Geology.com reports on a study earlier this year by a geology professor at the State University of New York at Fredonia, Gary Lash, who found that the Marcellus Shale may contain more than 500 trillion cubic feet of natural gas.

If 10% of that is recoverable, it could supply America's natural gas needs for two years and would have a "wellhead value" of $1 trillion, according to Geology.com. In other words, by the time the story is over, upstate New York will end up looking not like Appalachia but like Dallas or Dubai. Already, Western New York landowners are getting bonuses of up to $2,000 an acre from companies wanting to lease gas extraction rights. Those bonuses are before royalties to the landowners, which can amount to 12.5% of the value of the gas that is extracted.

The national security consequences would also be considerable. Every unit of energy that comes from upstate New York is a unit that doesn't have to come from Iran or Venezuela or Saudi Arabia or some other nation hostile to America and known for spawning or supporting terrorists. For every politician talking about ending America's "addiction" to foreign oil, the Marcellus Shale is a chance to act rather than just talk. It's a chance to move the energy debate beyond the frozen confines of whether to drill in the Arctic National Wildlife Refuge and on to new terrain.

As for the environmental risks, they are surmountable. As we noted in our July 25 editorial, "The Barnett Shale," that natural gas field has been mined without any ill effects on the metropolitan area of Dallas Fort-Worth, which sits atop it. Not only have there been no ill effects, there have been remarkable benefits in terms of prosperity, growth, and increased tax revenues. As Commissioner Lloyd noted in her letter, "horizontal drilling has seen significant technological advances in recent years, and access to these substantial reserves is now more feasible — both technically and economically — than ever before." She said, "We also understand the potential economic benefits increased mining and drilling could have for New York State."