Energy in Depth

A Taxing Debate

A story out of Pennsylvania today (which ran in several papers throughout the state) lays out the case that Governor Ed Rendell has been making for imposing new taxes on natural gas development in the Marcellus Shale — a 365 million-year-old layer of rock that underlies 54 of Pennsylvania’s 67 counties (and may hold more than $1 trillion worth of gas).

The governor’s position? Pennsylvania is an economic mess right now, and slapping new taxes on Marcellus Shale development could help generate $632 million for the state in just four years. But there’s a problem – from the Philadelphia Inquirer today:

“Virtually all of the Marcellus wells are still in the exploratory stage, with only one in southwestern Pennsylvania sending gas into a production pipeline.”

$632 million from a single producing pad? Maybe if were mining gold bullion instead of natural gas. Anyone else have anything else to say about that figure?

Stephen Rhoads, president of the Pennsylvania Oil and Gas Association, opposes the tax, calling Rendell’s numbers “a complete fantasy,” claiming a tax would yield less than $40 million.  He said the tax would also hit landowners as well as drillers, and disputed poll numbers that show the state’s residents support the tax.

Where did the Rendell administration come up with these numbers? Who’s been providing him the air support he needs to make these outlandish claims to the public, the legislature, and the press?

The Pennsylvania Budget and Policy Center, in a report released late last month, supported the governor’s proposal, saying severance taxes are common across the United States as a way to cover the public costs – most notably environmental ones – created by resource extraction.

However, the Pennsylvania Budget and Policy Center (PBPC) is a regional offshoot of the Center on Budget and Policy Priorities, a Washington, D.C.-based organization that advocates for larger, more expansive government and higher taxes, no matter what the issue.

If Gov. Rendell were trying to advance a tax on lollipops, you could bet PBPC would support it. And likely work up a quick study suggesting it generate a billion in revenue, and a trillion dollar savings in health care (no more trips to the dentist!)

Still, PBPC occasionally finds its way into energy-related issues now and then, recently coming out in strong opposition to energy exploration in and among a small portion of the state’s forest areas. How could producing more of our nation’s energy – and collecting the fees and taxes associated with it – be a bad plan from a budgetary perspective? It’s not. Too bad an outfit that touts itself as a “budget and policy center” can’t realize it.

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In the time it will take you to read this message, America’s small and independent oil and natural gas producers will have utilized advanced technologies and innovative engineering to safely produce enough energy to heat your home for 589 years, fuel your car for 159 years and, before the day is out, create 136 new jobs along the way.

Plenty of sites have been created to celebrate these accomplishments; others, to malign them. Energy In Depth was created to explain them — to tell the real story of the people responsible for producing energy in America. Brought to you by thousands of small, independent, American energy producers, Energy In Depth separates fact from fiction by giving visitors a virtual, first-hand look at the production process: unvarnished, up close, and yes: in depth.

In the 150 years since Edwin Drake used a 32-foot iron pipe to develop America’s first commercial oil well, those who produce America’ s energy have relied on cutting-edge science and technology to fuel our economy and improve our standards of living. As our country’s energy needs have grown, so too has our commitment to meeting them, and meeting them safely.

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Welcome to Energy In Depth

In the time it will take you to read this message, America’s small and independent oil and natural gas producers will have utilized advanced technologies and innovative engineering to safely produce enough energy to heat your home for 210 years, fuel your car for five, and create 52 new jobs along the way.

Plenty of sites have been created to celebrate these accomplishments; others, to malign them. Energy In Depth was created to explain them – to tell the real story of the people responsible for producing energy in America. Brought to you by thousands of small, independent, American energy producers, Energy In Depth separates fact from fiction by giving visitors a virtual, first-hand look at the production process: unvarnished, up close, and yes: in depth.

In the 150 years since Edwin Drake used a 32-foot iron pipe to develop America’s first commercial oil well, those who produce America’ s energy have relied on cutting-edge science and technology to fuel our economy and improve our standards of living. As our country’s energy needs have grown, so too has our commitment to meeting them, and meeting them safely. Today’s technologies enable us to reach energy supplies at depths measured in miles, not feet, with a surgical precision that delivers higher yields and a cleaner environment at the same time.  (more…)