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Chasing Shale
NY Farmers Look to Circumvent Fracking Ban

Late last month Governor Andrew Cuomo put a bow on a fracking ban in New York state, but that hasn’t stopped some residents from exploring ways to tap the Marcellus shale bounty under their land. A group of farmers in a county just west of Binghamton submitted a proposal to frack not with water, but propane gel. The Ithaca Journal reports:

“We are outside of the state’s ban,” Tioga Energy Partners, LLC legal counsel Adam Schultz said. “The state banned high-volume hydraulic fracturing, but that’s not what we’re doing.”..Tioga Energy Partners is the contracting company working with the Snyder Farm Group on the drilling application. […]

The Snyder group is a collection of five Tioga County farm families who have leased land for natural gas development. The group is seeking to develop a 53-acre natural gas well in Halsey Valley, which is in the Town of Barton, Tioga County — about 25 miles south of Ithaca and 30 miles east of Elmira. […]

“What the state studied, and eventually decided to ban, was the use of high volumes of water for fracturing purposes,” Schultz said. “This process that we are proposing doesn’t use any water, the fracturing takes place using liquified petroleum gas.”

It says something about the opportunity this group of farmers sees in shale, that they’d be willing to go to these lengths to circumvent the ban. When that ban became official, we pointed out that such a blanket approach would inevitably alienate landowners keen on reaping the economic benefits from shale production, especially in a part of the country still looking for ways to replace bygone heavy industry.

Mineral rights allow individuals to choose whether or not they’d like to live with the drawbacks that hydraulic fracturing brings with it: noise, trucks, and as with any energy source, risks. Taking that choice away seems a ham-fisted way to deal with the controversial drilling practice. And in south central NY, there’s already work underway to circumvent that policy.

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  • Fat_Man

    States that ban fracking should be embargoed from buying gas for less than $16/MMBTU (Current US domestic price is ~$2.77). If they will not bear the environmental cost of fracking, they should not receive the economic benefit.

  • Jacksonian_Libertarian

    This is a “taking” by the state without Just compensation. It should be unconstitutional, as we all know this law wasn’t enacted because fracking is polluting as the so called study was totally bogus, but rather to satisfy the politically powerful environmentalists.

  • CaliforniaStark

    The New York State fracking ban only applies to fracked wells using more than 300,000 gallons of water. The propane fracking method proposed by the farmers in their application would not fall under this ban.

    If the application is permitted; it will provide a major boost to the development of waterless fracking technology, and the economy of upstate New York; if it is denied, am expecting a very strong and significant legal challenge. Recently the U.S. Supreme Court indicated it will take a closer look at the economic impacts of government regulations vs. purported benefits. The farmers should be compensated if New York State deprives them of their mineral rights.

    • f1b0nacc1

      As a minor point, the SCOTUS didn’t indicate “that it would take a closer look at the economic impacts of government regulations vs purported benefits”, it indicated that the EPA should have done so, and that not doing so was a basis for vacating its proposed regulations. This isn’t a subtle distinction, as it leaves bans like the one in NY (which was state, not federal, and thus would also likely be free of SCOTUS scrutiny) in place.
      On the other hand, your point about waterless fracking is very well taken.

      • CaliforniaStark

        Agree with your clarification; the SCOTUS indicated it will review whether a governmental agency properly evaluated the economic impacts of a regulation the agency enacts. However, in effect the SCOTUS will be taking a closer look at the economic impacts of a regulation to evaluate whether the regulatory agency acted properly. The ruling provides for a higher level of scrutiny than was thought to have previously existed.

        Again want to emphasis; the New York fracking ban does not apply to the farmers’ application.

  • Tom Maguire

    Re: “Mineral rights allow individuals to choose whether or not they’d like to
    live with the drawbacks that hydraulic fracturing brings with it:
    noise, trucks…”

    Pro-fracking though I may be, I don’t see how the sale of mineral rights by landowner A compensates Neighbors B and C for the truck traffic that will affect streets throughout the town and county. I could see that if the selling group were large enough to encompass all the residents, that issue would be resolved, but otherwise there are uncompensated externalities. That is a solvable problem, but the solution has not been presented here.

    • mrkwong

      I’d imagine it depends on how much well-drilling activity there is, because once the well is drilled you have a wellhead and that’s about it. Most of the traffic would come from workers moving into the area.

      Farming generates a fair bit of truck traffic in itself.

    • John Pryce

      We’re also talking about people in rural areas, not suburbanites. Obviously if this was in my neighborhood, the traffic cost to my neighbors would be significant.
      .
      But here’s what the area in question looks like (see image). I’d say that the net traffic cost will be minimal.

    • tdperk

      “Pro-fracking though I may be, I don’t see how the sale of mineral rights
      by landowner A compensates Neighbors B and C for the truck traffic that
      will affect streets throughout the town and county”

      Oh horrors! People who pay fuel taxes are using the public roads same as everyone else!

      • Tom Maguire

        FWIW, it is certainly plausible to argue that people who pay fuel taxes owe no other compensation for their use of the roads, and affected neighbors who don’t like that can put an egg in their shoe. But that is not what the author claimed – his claim was that the market for mineral rights provided compensation to those affected, which I dispute.

    • CaliforniaStark

      As a condition of any drilling permit, a government agency can require mitigation of any negative traffic impacts, the same as it can require for a new housing subdivision, a new casino, or any other form of new development.

  • Jmaci

    A different website reported today that states (mostly red ones) are considering ignoring some of the EPA’s latest rules. Now NY landowners are considering ignoring the fracking ban. Add those to “sanctuary” cities ignoring immigration law, and states ignoring drug laws. It’s beginning to look like Americans are fed up with their government.

  • f1b0nacc1

    Binghamton is dying (it won’t be mourned by many), so it isn’t surprising to see folks in that area trying ANYTHING to get around these bans. Ultimately though, as long as NY state is being run for the benefit of NYC, very little will change….

    • tdperk

      …NY state is being run for the benefit of NYC politicians…

      FIFY, no evidence NYC is benefiting much.

      • f1b0nacc1

        Thank you, that is a far superior way to put it!

  • jim

    So is Cuomo requiring New York gas companies to ethically source their gas?

    Or are they sucking every BTU of cheap fracked gas out of Pennsylvania and West Virginia they can get their hands on? And leaving the residents of those states to take all the risks while New York gets all the benefits. (Some would call this Imperialism if it wasn’t New York doing it!)

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