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Americas: Pennsylvania governor pushes for severance tax on gas drillers

Americas: Pennsylvania governor pushes for severance tax on gas drillers

Write: Nara [2011-05-20]
p>Pennsylvania Governor Ed Rendell called again Tuesday for a severance tax on natural gas producers to generate funds needed to repair road and environmental damage caused by drillers, two weeks before the Republican-controlled Senate of the Pennsylvania legislature reconvenes to
vote on a new oil and gas law.


The Democratic-controlled state House of Representatives has already passed its version of the new oil and gas law, calling for a severance tax. The Republican upper house is expected to pass some form of tax, but wants to deal with such items as forced pooling -- or compelling landowners to join those in adjacent parcels who have sold mineral rights -- and the primacy of state laws over zoning decisions by towns and cities.


Appearing in Washington County, south of Pittsburgh in the heart of southwestern Pennsylvania's portion of the Marcellus Shale, Rendell renewed his call for a severance tax modeled on neighboring West Virginia's: 5% on the wellhead price with an additional 4.7 cents/Mcf.


Rendell said a series of accidents this year by gas drillers show the need for a tax to generate funds local towns and cities need to train police officers and firefighters as well as fund efforts by environmental organizations to remediate damage to the environment.


"Local emergency responders such as firefighters, police officers, medics and hazmat crews were called to manage the emergencies until gas company experts could further address the situations," Rendell said.


"That created considerable costs to the municipalities and taxpayers that support those crews," he added. "It underscores the reason we need a robust severance tax -- so the communities where drilling is taking place get the financial help they need to tackle these problems."


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