UPDATE 1-NY Gov Cuomo looks to natgas drilling for jobs
By Dan Wiessner
ALBANY, N.Y. , July 1 (Reuters) - New York state's top environmental official presented plans to allow drilling in one of the world's richest natural gas deposits on Friday, but said he is unlikely to review drilling applications before 2012.
The head of the Department of Environmental Conservation has recommended that New York allow hydraulic fracturing in most of its share of the massive Marcellus Shale formation. Environmental and public health activists have said the high-volume gas extraction method can pollute drinking water supplies, so the state would ban drilling in the New York City and Syracuse watersheds and within 500 feet (152 meters) of public water supplies.
"We can protect the environment and reap some of the economic and energy benefits of drilling," Department of Environmental Conservation (DEC) Commissioner Joe Martens said at a news conference.
The natural gas industry says drilling will create up to 37,000 jobs and funnel much-needed revenue to local governments in the state's depressed Southern Tier, an upstate region hurt by a manufacturing exodus.
A successful drilling plan could help Democratic freshman Governor Andrew Cuomo make inroads in an area largely dominated by Republican politicians, political observers said.
"The DEC's decision was based on rigorous testing, research, facts and science, not politics or ideology on the issue," Cuomo said.
Hydraulic fracturing, known as hydrofracking or fracking, blasts vast amounts of water mixed with sand and chemicals deep into shale rock, freeing trapped gas. [ID:nN18229665]
Critics fault the process because it requires storing large amounts of chemical-laced water in above-ground pools. They have pressured companies to reveal the chemicals used in drilling, which environmentalists say can leak and endanger ground water.
"Thousands of new wells will be drilled across the state, using billions of gallons of fresh water and industrializing the rural communities across the state," said Wenonah Hauter, executive director of environmentalists Food & Water Watch.
Timothy Considine, a professor of energy economics at the University of Wyoming and an advocate for drilling in New York, has said natural gas drilling in New York state would lead to $11.4 billion in economic output and raise $1.4 billion in state and local tax revenue.
Considine's analysis, which looked at the impact of drilling in neighboring Pennsylvania, also found that of the 2,139 Marcellus wells drilled in Pennsylvania between 2008 to 2010, 1,924 incurred environmental violations.
On Friday, Martens also announced the creation of a High-Volume Hydraulic Fracturing Advisory Panel, which includes environmentalists, business leaders and elected officials.
"If done right, the on-going process in New York continues to hold out the best opportunity to establish a national, and even international, model of how taking a cautious approach to proposed new fossil fuel development can protect people, communities and the environment at large," said Kate Sinding, a lawyer with the Natural Resources Defense Council.
Business leaders applauded the Cuomo administration's report. Heather Briccetti, head of the New York State Business Council and another panel member, said it strikes a balance between economic development and environmental concerns.
"New York cannot simply stand on the sidelines while Pennsylvania and other states see the employment and economic benefits from shale exploration," she said.
A 60-day public comment period will begin around September 1; then Cuomo could decide how to regulate hydrofracking. (Additional reporting by Edward McAllister; Editing by Edith Honan, Joan Gralla, David Gregorio and Lisa Shumaker)