Nornew: DEC Regs Unlock Chenango's Potential
Published: October 9th, 2009
By: Melissa deCordova

NORWICH – Last week’s release of the New York State Department of Environmental Conservation’s draft regulations on permitting natural gas hydrofracking into shale “clearly involves our future,” said a spokesman for Norse Energy, Inc., the most prominent natural gas developer in Chenango County.

“We are very encouraged by the DEC. I can’t say until we go through it - all 900 plus pages of it - that we agree with everything in it,” said Norse attorney Dennis Holbrook, “but they’ve gone to great lengths to try to address every detail ... to be very thorough.”

Norse Energy, a Norwegian-based company (also known as Nornew), has successfully brought natural gas to the marketplace from wells drilled into sandstone formations in Madison and Chenango County, primarily in the towns of Lebanon, Smyrna and Plymouth. The company says it has nearly all of the available acreage in the region’s Marcellus and Utica shales leased or purchased already, and is actively pursuing a business partner with the size, financial strength and experience to help them develop it.

“It’s been tough to do that while we were in that holding pattern,” Holbrook said, referring to the 18 months that it took the DEC to reveal the regulations.

“We see a lot of potential, but I use that word because up until now, it’s not been possible to test horizontal drilling and hydrofracking of those formations.”

The combination of horizontal drilling and hydraulic fracturing, which uses millions of gallons of water and generates an equal amount of waste, is widely used in the U.S. as a means of recovering gas from tight shale formations. The controversial technology and confirmation of the vast quantities of natural gas available in Marcellus is what prompted Gov. David Paterson’s call to revisiting the state’s permitting process.

It’s no secret that interest in Chenango’s Marcellus holdings isn’t too far off in the future. Major energy companies such as Hess, Fortuna, Chesapeake and XTO Energy have already leased large swaths of land just over the border in Broome County, offering landowners $5,000 an acre or more plus royalties for the right to drill. If the economy continues to trend in right direction, and natural gas prices stabilize around the $5 mark, Holbrook said the Southern Tier, including Chenango County, will definitely see shale development.

The DEC’s draft Supplemental Generic Environmental Impact Statement (SGEIS) contains pre-drilling, drilling and post-drilling requirements that may be new to companies. Some pre-drilling stipulations call for the disclosure of the chemicals used in fracturing; for well testing prior to drilling; for water consumption expectations; mitigation planning of greenhouse gas emissions; and visual, noise and trucking impacts.

In addition, there will be more stringent drilling and casing requirements; state inspectors must be present when operators commence cementing well-bore casings; and operators choosing to store formation and flowback water on-site must use steel tanks and double-liner systems similar to those required for landfills.

Companies will not only have to follow Susquehanna River Basin Commission and Delaware River Basin Commission protocols for water withdrawal, but also complete a more stringent and protective streamflow analysis in regards to water withdrawal plans – whether inside or outside the Susquehanna or Delaware basins. Water for metropolitan New York is piped downstate from those watersheds.

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