So exactly what did Chesapeake Energy Corp.'s decision not to drill any Marcellus shale natural gas wells in New York City's watershed mean? It depends on who you ask.
"One company's voluntary moratorium is no substitute for analyses by the state's Department of Environmental Conservation and Department of Health to determine the potential of natural gas drilling failures in the New York City watershed, and of damage to critical infrastructure in adjacent communities," a spokesman for the city's Department of Environmental Protection told OGJ Nov. 2.
Gwen Lachelt, director of Earthworks' oil and gas accountability project in Durango, Colo., said the same day that the environmental organization welcomed Chesapeake's "recognition that drilling is inherently risky, and that people don't want their drinking water at risk. Welcome and unenforceable declarations aside, the greater issues of permanent protection for the watershed and an underregulated polluting technology remain."
Chesapeake CEO Aubrey K. McClendon took a different view when he reported the Oklahoma City independent producer's decision.
'Needless distraction'
McClendon said, "It has become increasingly clear to us over the past few months that the concern for drilling in the watershed has become a needless distraction from the larger issues of how we can safely and effectively develop the natural gas reserves that underlie various counties in the southern tier of New York and create high-quality green jobs."
Chesapeake's research showed that it was the only leaseholder within the city's watershed, which put it in a unique position to take the matter off the table so the area's gas development discussion can proceed constructively, McClendon said.
"The small amount of acreage Chesapeake had acquired within the watershed region—fewer than 5,000 acres—was largely obtained as a result of leasing land outside the watershed from property owners who also had tracts within the watershed. This leasehold is immaterial to Chesapeake and also does not appear prospective for the Marcellus shale," he said.
Refocusing efforts
Chesapeake believes it can drill safely in any watershed, including NYC's, McClendon said, but the company has chosen to focus its efforts on more promising areas in the state.
The company supports the state DEC's decision to have all fracturing vendors register their products and reveal ingredients in them, and has already made such disclosures at its own web site.
Chesapeake has 1.5 million net acres leased in the Marcellus, making it the single-largest leaseholder in the formation, which begins in New York and crosses Pennsylvania into West Virginia, the company said.
On Nov. 2, the American Petroleum Institute released the second of four hydraulic fracturing guidance documents it has been developing. The well construction and integrity guideline aims to protect shallow groundwater aquifers during a well's drilling, completion, and production phases.
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