Corbett removes ban on drilling under Pa. parks

HARRISBURG -- Gov. Tom Corbett lifted a ban on new oil and gas leases in state forests on Friday and replaced it with one that will allow gas below state parks and forests to be tapped from nearby sites as long as the surface is not disturbed.

The governor hopes to generate $75 million from new leases to help balance the state's budget.

The executive order issued Friday calls for the Department of Conservation and Natural Resources to seek to use future royalties from the leases to acquire more land for conservation, buy mineral rights below high-value public lands and make upgrades to state park and forest facilities.

"With this executive order, I am directing that the commonwealth maintain a moratorium on any additional gas leasing of DCNR lands that involves long-term surface disturbance, such as placing well pads, roads or pipelines in the newly leased areas," Mr. Corbett said.

DCNR will review proposals as they are suggested by oil and gas operators who have the ability to access the gas by drilling from parcels they already have under lease on state lands or nearby private lands. The state has not identified any specific properties for lease and companies have not yet approached the state with proposals, Mr. Corbett's Energy Executive Patrick Henderson said.

About 700,000 acres in the state's 2.2-million-acre public forest system are already available for gas development, either through DCNR-issued leases or in areas where the subsurface rights are privately owned.

Former Gov. Ed Rendell issued an executive order in October 2010 that prohibited lands owned and managed by the DCNR from being leased for oil and gas development. At that point, the agency had already leased 139,000 acres of forest for drilling during his tenure.

DCNR Secretary Ellen Ferretti said the state forest system has maintained its certification as "well-managed" under the Forest Stewardship Council standards through five years of Marcellus Shale gas development.

"I am confident that DCNR can continue to manage our system for a variety of uses and values, including ecological integrity, outdoor recreation and the environmentally sound extraction of underground resources," Ms. Ferretti said.

Environmental groups oppose opening more public lands for gas leasing and say it is impossible to limit the disruption caused by the development to the discrete areas where the surface is disturbed.

They point to a DCNR monitoring report released this spring that found that converting nearly 1,500 acres of forest into pads, roads and pipelines for shale gas development changed the wild character of 9,300 acres of state forest.

John Hanger, a Rendell-era secretary of the Department of Environmental Protection, called the new leasing plan a "one-time budget gimmick" that "will have long-lasting effects on our forests and on the citizens' ability to enjoy their public resource."

A coalition of environmental groups chastised the governor for using public lands as "an ATM during budget season."

The governor's plan won the support of the state's major shale gas advocacy group and the Pennsylvania Chamber of Business and Industry. The Marcellus Shale Coalition called it a "common sense approach" while the chamber said it is possible to protect the state's natural lands while benefiting from the economic opportunities brought by natural gas development.

In a fact sheet, DCNR said that for the purposes of the executive order, a surface disturbance will be defined as the "long-term conversion of the forest to a non-forest use," like building or enlarging the footprint of roads, pipelines, compressor stations and well pads on the new leases.

"Limited short-term use of the forest surface for surveys or resource evaluation will be considered by the department on a case-by-case basis," the agency said.

DCNR also will consider allowing adjustments to gas companies' current plans for development on previously leased forest tracts if they are needed to gain access to new leases "so long as there is no net gain in surface disturbance."

Critics have questioned how Mr. Corbett came up with the $75 million budget figure and whether he has the authority to direct how future royalties will be spent.

The Pennsylvania Office of Open Records on Thursday decided in favor of Democratic state Rep. Greg Vitali of Delaware County in his effort to get DCNR to release more details about the leasing plan, including how the $75 million figure was calculated.

In 2009, the General Assembly assumed the power to decide how oil and gas revenues are spent. Before then, money from drilling in state forests was deposited in a fund that was to be used only for conservation, recreation and flood control projects at the direction of DCNR. In recent years, as the fund ballooned from Marcellus Shale revenue, the money has been used to fill budget gaps and fund the daily operations of DCNR.

The Pennsylvania Environmental Defense Foundation has sued the state over the transfers from the Oil and Gas Lease Fund. A hearing in that case is scheduled for Wednesday.

Mr. Henderson acknowledged the General Assembly ultimately appropriates funds that are generated from leasing activity, but he said the governor has expressed "his strong desire" in the executive order and elsewhere "to see these dollars allocated to further bolster the state park and state forest system, and will advocate for such at every opportunity."

Laura Legere: First Published May 23, 2014 2:45 PM

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