Pennsylvania’s Marcellus Drillers Throw Money Around, Look to Squash Severance Tax

Pennsylvania Marcellus shale gas drillers are spending big to influence policy making in the state, especially in regards to a proposed severance tax on gas production there. According to a report on stateline.org, the industry is pouring hundreds of thousands of dollars into the campaign accounts of state lawmakers and candidates running for governor who are sympathetic to its concerns.

For the past two years, gas drillers have been descending upon Pennsylvania, anxious to tap the vast natural gas resources in the state’s Marcellus shale. To get at the natural gas, drillers use a process called hydraulic fracturing, or fracking, which involves injecting water, sand, and a cocktail of chemicals at high pressure into rock formations thousands of feet below the surface. Environmentalists are concerned that fracking could contaminate the state’s waterways, some of which supply water to cities along the East Coast. Already, fracking is suspected to have caused several instances of water contamination in Pennsylvania, and the issue has become contentious.

This November, Pennsylvania voters will go to the polls to elect a new governor and more than 200 legislators. And frackers have their favorites among the candidates. In May, the watchdog group Common Cause of Pennsylvania released a report detailing more than $7 million in combined campaign donations and lobbying expenses from the gas industry to state politicians in recent years. According to stateline.org, this includes a tripling of lobbying expenses over just the last three years.

Among other things, gas drillers want to block the imposition of a severance tax on natural gas production – something every other major gas-producing state has. According to stateline.org, Attorney General Tom Corbett, the Republican nominee for governor and an opponent of the tax, received $284,000 from natural gas drillers last year alone. That included a $150,000 donation last December from Kim Pegula, the wife of the founder of East Resources, a gas exploration company.

His Democratic opponent, Dan Onorato, who favors the tax, has received a mere $59,000 from energy firms, stateline.org said.

Opponents of the severance tax claim it will drive drillers – and the jobs they bring – out of Pennsylvania. But that hardly seems likely, because as stateline.org points out, the industry is already heavily invested the state. What’s more, the gas they want is in Pennsylvania. According to stateline.org, a Penn State University professor and minerals expert says that natural gas reserves in the Pennsylvania Marcellus shale are so large, it might as well become “an OPEC nation.” It seems doubtful the natural gas industry would be willing to walk away from that much natural gas, severance tax or not.

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