Gov. Corbett today announced details of his long-awaited plan for addressing the costs and environmental impact of Marcellus Shale natural gas drilling across the state, proposing that counties set a per-well fee on drilling companies and establishing tougher environmental standards and enforcement.
After months of anticipation, Corbett said at an event in Pittsburgh that his plan balances the need for clean energy and well-paying jobs with the environmental, infrastructure issues and other costs of shale drilling.
"It places the fee where the actual impact is," said Corbett, addressing a crowd at Carpenters training center, which is training apprentices for work in shale-related industries.
Corbett's plan, which is based on recommendations he received from his Marcellus Shale Advisory Committee, would allow an impact fee of no more than $40,000 per well in a well's first year. It estimates that it would generate $120 million in the first full year, and $195 million by the sixth year.
Most of the money would remain in drilling communities, while 25 percent would go to the state for environmental protection, health, emergency management, pipeline inspection.
Corbett's plan, which would require legislative approval, also includes:
• Increasing the well setback distance from private water wells from the current 200 feet to 500 feet, and to 1,000 feet from public water systems;
• Increasing the setback distance for wells near streams, rivers, ponds and other bodies of water from 100 feet to 300 feet;
• Increasing well bonding from $2,000 up to $10,000;
• Increasing blanket well bonds from $25,000 up to $250,000;
• Expanding an unconventional gas operator's "presumed liability" for impairing water quality from 1,000 feet to 2,500 feet from a gas well, and extending the duration of presumed liability from 6 months after well completion to 12 months;
• Enabling DEP to take quicker action to revoke or withhold permits for operators who consistently violate rules;
• Doubling penalties for civil violations from $25,000 to $50,000; and
• Doubling daily penalties from $1,000 a day to $2,000 a day.
The issue of whether to impose impact fee or tax has been the focus of ongoing debate since shale drilling began to take off in 2008.
Corbett vowed in his 2010 campaign not to impose any new taxes on shale drilling, saying it would drive away a lucrative industry. But he has said he can justify supporting a fee because it is directly connected to the industry-related costs born by local government.
Unlike other major gas producing states, natural gas producers do not pay a tax on production in Pennsylvania.