The suggestions were made during the March 2 Senate hearing on DCNR’s budget proposal during a discussion of how to fund the $1.4 billion in safety and repair projects needed in Pennsylvania’s State Parks and Forests.
More Gas Drilling
Sen. Yaw, who serves as the Majority Chair of the Senate Environmental Resources and Energy Committee, said DCNR has about 600,000 acres of State Forest land in Marcellus Shale natural gas areas that could be leased to raise money for the agency.
“If you took 1 percent of the land you had, if I did my math correctly, it’d be 22,000 acres. Upfront bonus payments [for leasing that land] is in the neighborhood of $4,000 an acre,” said Sen. Yaw.
He said that would generate one-time revenue of $88 million, plus royalties for the natural gas produced.
“We're talking about an asset that's 6,000 feet underground. And I guarantee you that somebody walking on the surface cannot tell one way or the other, whether there's natural gas 6,000 feet down,” said Sen. Yaw.
“So it's not, you know, disturbing the surface, and we've all talked about non-surface disturbance,” said Sen. Yaw. “I would advocate that there are no roads, pipelines or anything. That everything happens 6,000 feet down. And I think that as a result of that, the simple example, if you use 2 percent or 1 percent of the land, and you were fortunate enough to get $4,000 an acre bonus payment up front.”
[Note: “Non-surface disturbance” drilling was invented by the Corbett Administration to try to make the industrial enterprise of shale gas drilling less threatening.
[In-point-of-fact, shale gas drilling rigs don’t “fall from the sky,” they have to be located somewhere. Under the non-surface disturbance approach, there would be drill pads ringing some State Forest lands located just outside their boundaries so they could drill under and into DCNR holdings. They would have the same local impacts with roads, water, noise, pipelines and forest fragmentation.
[It also makes it very difficult to design bids that would be attractive to companies because they would have very specific requirements to be located next to, but be able to drill into State Forest land that has enough shale gas to make it worthwhile.]
“All I'm saying is this. And no matter how you do this math and everything, the point is, you have an asset, you're sitting on it and we're not using it,” said Sen. Yaw. “It's self-help. I equate this to having a winning lottery ticket and you're not gonna cash it in.”
“We're talking about one or two percent would generate significant dollars to be put back into the needs that you say that you have, rather than burdening the general fund and the taxpayers with it,” said Sen. Yaw.
[Note: Actually, the funding proposal being actively discussed is Growing Greener III-- a bipartisan proposal by Senators John Gordner (R-Columbia) and Carolyn Comitta (D-Chester) and others to allocate $500 million from the federal American Rescue Plan to fund Growing Greener watershed, farm conservation, mine reclamation and recreation projects in Senate Bill 525. Read more here.
[There is also a bipartisan companion House version-- House Bill 2020 Schlegel Culver-R-Northumberland, Guenst-D-Montgomery.]
DCNR Secretary Cindy Adams Dunn responded by pointing out 65 percent of the existing shale gas leases it has with drillers on State Forest land have not been developed.
“Interestingly, the leases we currently have, only a third of them [were] developed,” said Secretary Dunn. “So the companies can make a decision today to go in and develop 65 percent more of the lease land today.”
“The companies aren't choosing to do what they could do today,” she said.
“[There] is another complication on the revenue side,” said Dunn. “There's been a lot of case law in Commonwealth Court and [PA] Supreme Court [on how revenue derived from shale gas drilling on State Forest land is to be used].
“The latest Supreme Court finding in a PEDF [PA Environmental Defense Foundation] case talked about the bonus, rent and royalties all being part of the public trust, which, you know, frankly helps us,” said Dunn.
[Note: The PA Supreme Court has ruled twice DCNR, the General Assembly and the Governor have a fiduciary responsibility under the public trust provisions of the constitution’s Environmental Rights Amendment to manage state forest lands in the best interests of the public, and not use them like a piggy bank-- or “lottery ticket.” Read more here.
[Following up on the PA Supreme Court’s ruling, the PA Environmental Defense Foundation has a motion in Commonwealth Court asking that $1.3 billion in state forest drilling revenue that was used to balance the state budget and pay administrative expenses of DCNR and for other purposes be returned to DCNR. Read more here.]
“I think you're going to see more revenues [from existing shale gas drilling], said Secretary Dunn. “We're gonna blow past the revenue number in this year's budget.”
“We've got four active rigs working out there now on lease lands and the price [of natural gas] is up. So we are gonna do better than in the budget book.”
“The big lottery ticket we do hold that we do wanna talk about, and that's outdoor recreation [and what it] brings back to the state's economy,” said Dunn.
Mining Under Yellow Creek State Park
Sen. Joe Pittman (R-Indiana) said he wanted to follow up on Sen. Yaw’s “self-help” suggestion saying-- “I've brought you a very specific opportunity to generate revenue without surface disturbance to one of your parks.”
The opportunity was a proposal sent to DCNR in June of 2018 by Rosebud Mining Company to lease approximately 920 acres of coal underlying a portion of Yellow Creek State Park in Indiana County for mining. Read more here.
The coal is in the Lower Kittanning seam about 400 feet below the surface and would be accessed from Rosebud’s Brush Valley and Barrett Mines.
The proposed mining would be by room-and-pillar method that would leave coal in place for surface support.
In addition, mining would not occur under any of the developed areas or structures in the Park and the surface rights lease would be limited to test hole locations. But it would occur around the southern shore of the 720-acre Yellow Creek Lake.
Click Here to read Rosebud’s letter.
In January of 2019, DCNR responded to the proposal by saying-- “A coal lease at Yellow Creek State Park would conflict with the Bureau of State Parks’ mission to maintain and conserve the Commonwealth’s state parks.
“As a trustee of the Commonwealth’s public natural resources under Article I, Section 27 of the Pennsylvania Constitution, BSP has a duty to protect state park lands on behalf of the Commonwealth’s citizens.
“Accordingly, BSP declines your offer to negotiate a coal lease under Yellow Creek State Park.”
Click Here to read DCNR’s response.
Sen. Pittman went on to say-- “And I know your answer will be there's a level of risk. But following up on our previous dialogue here, there is a level of risk to anything we do in terms of development on our planet.
“I would just underscore that that same park that I've given you this opportunity is experiencing water leakage that is so massive, and I understand your water bill is $6,000 a month.”
“Now you've told me we need Growing Greener III to make it happen. I struggle with the reality of the self-help here in some of the discussion that Chairman Yaw had in terms of your existing resources and figuring out a way to responsibly use them, while managing risks and downsides of what we're experiencing by not using those resources,” said Sen. Pittman.
Secretary Dunn responded by saying-- “Yellow Creek, by the way, it's a wonderful park and your citizens talk to us all the time about how much they use it and love it.
“It's a big park, and it does have a leaking water system that is high on our list to resolve.
“What I was saying about the self-help is given the popularity of that park and what it generates for the local economy,” said Dunn.
“We're sitting on a huge lottery ticket, as it were-- the gross domestic product coming out of recreation, coming out of our mission, is immense for the Commonwealth [$12 billion a year] and I think it's underappreciated and undercounted,” said Dunn. “So it more than justifies spending some money on fixing that leaking water system and being able to serve your constituents and the Boy Scouts and everyone else better.”
Secretary Dunn then turned to the example of Ryerson Station State Park in Greene County where the dam for the 62-acre Duke Lake was severely damaged by longwall underground coal mining-- a different kind of mining than Rosebud is proposing-- and had to be breached and the lake permanently drained in 2005.
In April 2013, CONSOL signed an agreement with DCNR to pay for the damages it caused that at the time exceeded $36 million. Read more here. In 2019, working with the community, DCNR used settlement funds for a new swimming pool complex and is working on other improvements to the park. Read more here.
“I would stand by that [decision] because it does return on investment, and the park that did see a problem with coal mining [was] a loss, a complete loss, of the lake in Ryerson [Station],” said Secretary Dunn.
“I'll be going down to Ryerson this year to cut the ribbon on some of the new version of that park that's gonna have to go forward without a lake because of the cracking of the dam due to the coal mining.”
“ It's just, in my judgment, there's a risk we couldn't take in that site [Spring Creek]-- despite the coal company having a great reputation and all that. It's just not a risk that we could take,” said Dunn. “But, I do wanna do everything I can to bring that park back to where it used to be.”
Sen. Pittman responded-- “And I appreciate that, secretary. But to be very clear, Ryerson and Yellow Creek are two very different examples of potential mining and impacts of mining. Not only in the technologies being used, but also the sub-surface in which was being considered.
“And I recognize this is largely philosophical, but whenever we have conversations about Growing Greener III, it would be a lot easier for me to support such initiatives if I saw that self-help in a more, in my opinion, responsible manner,” said Sen. Pittman.
Secretary Dunn concluded by saying-- “I understand your point and I'm sure we'll continue that conversation.
“I just have to point out that the geology around Ryerson surprised our geologists and the DEP geologists and everybody. So sometimes it's hard to fully understand what's gonna happen in a situation, that in the case of Ryerson, no one predicted that,” said Dunn.
Click Here to watch a video of DCNR’s Senate budget hearing.
$233 Million Surplus
Neither Sen. Yaw nor Sen. Pittman mentioned the asset they have under their direct control-- a $233 million surplus in operating funds-- up $30 million from the previous year-- sitting in their legislative accounts doing nothing. Read more here.
(Photos: Map of Rosebud Mining proposed underground mining area at Yellow Creek State Park; Breached dam at Ryerson Station State Park; Shale gas drilling pads in forested areas.)
Resource Links - DCNR:
-- DCNR Budget Testimony: Critical Investments Needed To Reduce $1.4 Billion Backlog Of Infrastructure Repairs, To Expand Local Economies, Provide Recreation For All
-- DCNR Budget Hearing: We Have A Unique Opportunity To Invest In Our Recreation, Clean Water & Land Conservation Infrastructure With Growing Greener III
-- DCNR Blog: Gov. Wolf’s Proposed Budget Supports Conservation And Recreation
-- DCNR Blog: Conservation Funds Help Communities Provide Outdoor Places, Opportunities; Apply Now
-- DCNR Blog: 2021 Year In Review From DCNR
-- DCNR Posts Budget Hearing Materials
Resource Links - DEP
-- DEP Budget Testimony: Significant Investments In Environmental Cleanup, Improving Permit Review Times, Holding Polluters Responsible, Relief To Those Harmed By Pollution
-- DEP Budget Hearing: Unconventional Natural Gas Industry Didn’t Drill 40% Of The Wells It Had DEP Permits For
-- Senate Budget Hearings: PA’s Experience With New Pipeline Construction Shows State Laws Not Strong Enough To Prevent Environmental Damage, Protect Public Safety
-- 12 Unconventional Shale Gas Drillers Issued DEP Notices Of Violation For Abandoning Wells Without Plugging Them At 35 Well Pads In 17 Counties
-- DEP Posts Budget Hearing Materials
Related Articles - Budget Briefing:
-- Budget Briefing: Senate, House Budget Hearings Should Talk About Once-In-A-Generation Investments In Cleaning Up The Environment; Oil & Gas Program At A Crossroads
[Posted: March 4, 2022] PA Environment Digest
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