New York, Ohio, and Pennsylvania stand to become the next North Dakota with fracking, Stateline.org reports. Overall, the U.S. will likely rank first in the world for producing oil and exporting natural gas by 2020.
However, in order to cash-in on the energy market, this trio of Eastern states will need to reconsider how they approach fracking. For example, Pennsylvania, which has acquired the nickname the “Saudi Arabia of natural gas” because of the rich Marcellus Shale field, has only an impact fee to help local towns repair roads and other damage caused by drilling. But that $204 million in 2011 could have been a lot higher had the Keystone State collected taxes similar to West Virginia.
“There should be a tax like other states have,” said Pennsylvania state Rep. Gene DiGirolamo, who is pressing for a 4.9% tax on companies mining natural gas in the Marcellus Shale field. “We’re not chasing the gas industry out of the commonwealth,” added state Rep. Tom Murt. “We just want the industry to pay their fair share.”
Ohio Gov. John Kasich has pressed to raise the severance tax, which ranks near the bottom of all states at a dime a barrel of oil and 2.5 cents per thousand cubic feet of natural gas. Next door in New York, Gov. Andrew Cuomo might reverse a moratorium on fracking natural gas. One group predicts drilling in New York could bring in $1.4 billion in revenue from taxes for both the state and local governments.
“Shale energy development has transformed the U.S. energy sector,” said Kyle Isakower, vice president of the American Petroleum Institute (API). A study sponsored by API projects that fracking will generate $130 billion in revenue to North Dakota between 2012 and 2035. Texas will receive $397 billion, while Pennsylvania will get a mere $60 billion during the same time period. (NACS: www.nacsonline.com)