To frack—or not?

Marcellus Shale Map

Marcellus Shale Map

The question has roiled state legislatures, divided communities and pitted neighbor against neighbor in recent years.

Pennsylvania and West Virginia joined the natural gas-drilling boom, and New York banned it. But Maryland, where Garrett and Allegany counties sit atop part of the gas-rich Marcellus Shale formation, has taken a much more deliberative approach to the controversial drilling method.

Daraius Irani, chief economist of TU’s Regional Economic Studies Institute (RESI), says he wasn’t surprised when the Maryland Department of the Environment asked RESI to analyze the economic impact of hydraulic fracturing—often referred to as “fracking”—in Western Maryland for the Marcellus Shale Safe Drilling Initiative.    

“We’ve worked with the Department of the Environment on other projects,” he notes. With David Vanko, a geologist and dean of TU’s College of Science and Mathematics, appointed by former Governor Martin O’Malley in 2011 to chair the Advisory Commission, TU was positioned to make  significant contributions to public policy.

Extracting the earth’s resources always  involves a variety of risks, Irani explains. For Maryland, deciding how much risk is tolerable—and how best to manage it—has thus far taken four years of study and sometimes heated debate. RESI’s contribution involved research, analyses, surveying and stakeholder input from residents, elected officials, business owners, tourists and community leaders.

“Maryland has a very small amount of the Marcellus Shale— only 1.6 percent of the total.” —Daraius Irani

The economic-impact study, designed by Senior Economist Susan Steward, aimed for a context-sensitive understanding of this complex issue. “It wasn’t just about employment, output, wages and tax revenues,” Irani explains. “There were other serious considerations, such as the ways in which drilling might affect community character, housing, roads and transportation, and recreation and tourism.”

As part of the study, RESI research assistant Zachary Jones ’14, then a TU student, joined five staff members sent to Garrett and Allegany counties to survey residents and visitors about fracking. In addition, two representatives from Garrett County’s Department of Economic Development, as well as a Frostburg University student, pitched in to help.

After consulting with county officials, the RESI team homed in on local gathering places and asked people at random to participate in the survey. “It’s tough walking up to strangers and asking for 10 minutes of their time,” Jones recalls, “but it was an important part of the study.

“We were cordial and honest,” he continues. “And most people liked to share their opinions.”

A Garrett County farmers market  and a Cumberland, Maryland, street fair proved to be great surveying sites. But Jones says he also approached hikers at a trail head as well as visitors at the Deep Creek Nature Center, restaurants and shops. In all, surveyers collected 158 on-site surveys over two days in Western Maryland. (A highly publicized online survey collected another 802  viable surveys.)

Jones recalls that most of those approached by the RESI surveyers were responsive. “About 50 percent of the respondents were well acquainted with issue of hydraulic fracturing,” he says. “The rest knew about it, but weren’t clear on the specifics.

“A lot of people live in that part of the state for the outdoor activities,” he continues. “Those respondents had strong feelings about the outdoors and how it contributes to both their livelihood and spiritual well-being.

“They were apprehensive about fracking and how it could hurt the environment or other industries in the area.”

Daraius Irani says analysis of the data collected over the course of the study indicate that both Garret and Allegany counties would experience an economic “boom” followed by a “bust” over a 10-year period if drilling were to proceed.     

Furthermore, the study found that housing values, industry sales, royalty payments and willingness to pay for wilderness conservation were key indicators of economic change associated with Marcellus Shale drilling.

“The impact would depend on the size of the economy before drilling and the amount of drilling that takes place,” Irani adds.

“Maryland has a very small amount of the Marcellus Shale—only 1.6 percent of the total. We are not going to be a Pennsylvania or North Dakota. Still, the state has to develop rules and regulations governing it, and that takes input from a great many people.

“The horizontal drilling technology has improved, and that may make the process safer, but that’s not to say that it would be economically viable at a time when oil prices have dropped.”

Fracking for natural gas will not get underway in Western Maryland in the near future. A law, signed in June, bans fracking in Maryland for two and one half years. It also requires the state to come up with standards after the ban is lifted. “There’s more work to be done,” Irani says. “But I’m glad RESI was able to contribute to the initiative.”

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