Gas drilling study fee debated

A study of how or whether to allow a controversial drilling method for extracting natural gas in Western Maryland cannot be finished without funding, state officials told lawmakers Tuesday.

O'Malley administration officials joined environmentalists in supporting a bill that would pay for their year-old study of hydraulic fracturing by levying a fee on the estimated 150,000 acres leased for gas exploration in Garrett and Allegany counties. Business and oil industry representatives opposed the fee, arguing that it could dampen prospects for drilling to boost the economically depressed region.

The bill, heard by the Senate Education, Health and Environmental Affairs Committee, would raise about $3 million over the next two years by charging gas companies $10 per acre on leased land. Officials said they need perhaps $2 million to finish their study of potential problems and safeguards. Hydraulic fracturing, commonly known as "fracking," involves extracting natural gas by pumping large quantities of water mixed with sand and chemicals to fracture or break up fuel-containing shale layers deep underground.

Gov.Martin O'Malleyput drilling in Western Maryland on hold until his staff finishes the study, which is expected to take three years. The pause was prompted by concerns over fracking in Pennsylvania and West Virginia, where there have been complaints of wells and streams being contaminated with methane or drilling wastes. Industry officials contend that such incidents are relatively isolated and unrelated to the fracking process.

"We need that money to answer these questions," said Brigid Kenney of the Maryland Department of the Environment. Some Western Maryland residents spoke in support of the fee measure, as well as another bill that would hold drilling companies liable if neighboring landowners' wells went bad.

Among them was Leo Martin, mayor of Mountain Lake Park, a Garrett County town that has voted to ban fracking within its borders. Martin said the town had a bad experience with gas exploration in the 1950s, when crews using traditional vertical drilling techniques "left a mess" in the form of leaking ponds full of muddy water. More recent reports of problems in Pennsylvania added to their concerns, he said.

Mike Koch, who sells artisanal goat cheese from his Firefly Farm in Garrett, said he was worried about the potential impact of fracking on his livestock, as well as more generally on the region's tourism industry.

Drew Cobbs, executive director of the Maryland Petroleum Council, said gas companies were willing last year to pay for the study when it was part of comprehensive legislation on fracking that might have allowed one or more wells to be drilled now. Industry officials now object to the fee, Cobbs said, warning that companies might drop leases or pay landowners less if the fee were imposed. He suggested that talks with O'Malley administration officials might resolve their differences.

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