Thompson Joint Subcommittee Hearing Highlights Need for Increased American Natural Gas Production, Job Creation

July 8, 2011
Press Release

Washington, D.C. – Agriculture Subcommittee on Conservation, Energy & Forestry Chairman Glenn ‘GT’ Thompson today held a Joint Oversight Hearing, “Challenges facing Domestic Oil and Gas Development: Review of Bureau of Land Management/U.S. Forest Service Ban on Horizontal Drilling on Federal Lands.” The hearing was held in conjunction with the Natural Resources Subcommittee on Energy and Mineral Resources. The panel received testimony from a number of experts regarding the U.S. Forest Service’s proposed ban on horizontal drilling in the George Washington National Forest, as well as the Interior Department’s possible regulation of hydraulic fracturing on federal lands.  Horizontal drilling provides significant benefits by reducing the footprint of oil and gas production and allowing for directional drilling in order to leave areas of environmental concern undisturbed.

“Through effective management practices, these resources have been successfully produced for decades and these technologies have the ability to enhance environmental stewardship. Recognizing the national need for affordable and reliable energy, I am extremely concerned about the Forest Service’s proposal to ban horizontal drilling and hydraulic fracturing in the George Washington National Forest,” said Thompson.

The Obama Administration has actively taken steps to block or delay American energy production, which has negatively impacted job creation and efforts to reduce America’s reliance on unstable foreign energy. These efforts are continued by the Administration’s attempt at blocking horizontal drilling and hydraulic fracturing on the Marcellus Shale, partially located in the George Washington National Forest.

“This proposal undermines the Forest Service’s mission of multiple-use and it comes at a time when we are increasingly dependent on foreign sources. Despite these terrible facts, the Administration continues in their attempts to stymie development of our own natural resources,” said Thompson.

According to economists and industry experts at the Pennsylvania State University, the development of the Marcellus Shale has the potential to be the second largest natural gas field in the world. A recent study estimates that in 2009 alone, the development of this resource added over 44,000 new jobs in Pennsylvania, $389 million in state and local tax revenue, over $1 billion in federal tax revenue, and nearly $4 billion in value-added to the state’s economy.

“Make no mistake, predictable and affordable natural gas prices have been a direct result of horizontal drilling and hydro fracturing,” added Thompson. “The Marcellus has brought upwards of 100,000 new jobs to Pennsylvania alone, significant new tax revenues to the state, over $200 million to build new roads, and an unimaginable amount of natural gas for the country.”

The Marcellus Shale underlies 50% of the George Washington National Forest.  Witnesses testified about the safety of hydraulic fracturing when paired with horizontal drilling and the job creation associated with natural gas production on our public lands:

•Maureen Matsen, Deputy Director of Natural Resources and Senior Advisor on Energy for the Commonwealth of Virginia reminded the panel that Virginia’s “natural gas production has meant more than $2 billion in capital investment, $360 million in royalties, $150 million in severance taxes paid…and more than 3000 jobs.”  She went on to note that while “there have been no documented instances of surface water or groundwater degradation from facing in Virginia,” the proposed Forest Service ban would “harm Virginia, and Virginians by burdening businesses and preventing job growth” and “undermine the nation’s energy security by placing domestic resources out of reach at a time when the global competition for energy resources is rapidly increasing.”

•Pennsylvania General Energy’s General Counsel, Craig L. Mayer testified about a 2009 Settlement Agreement between the Forest Service and the Sierra Club that would have blocked 513,000 acres in the Allegheny National Forest.  The Settlement was later overturned by a judge but Mayer said, “if it remained in force, it would have had an irrevocable, profound, massive, and devastating adverse impact on oil and gas production activity in the ANF and upon the economy, communities, and people of the surrounding region dependent on this development activity.”

•Lee Fuller, Vice President of Government Relations with the Independent Petroleum Association of America commented on the on the proven safety of hydraulic fracturing noting, “with about one million operating oil and natural gas wells in the United States, tens of thousands being drilled annually and only a small number of problem incidents, it is clear that the process is sound and effective.”

•David Miller, Standards Director of the American Petroleum Institute reminded the panel that “the great majority of hydraulic fracturing activities take place at depths far below existing groundwater sources that could reasonable be considered underground sources of drinking water.”