This is an opinion piece I published on LinkedIn on December 17, 2014, and I think it’ll be a good first post:
Earlier today, New York Governor Andrew Cuomo announced – as many in the industry suspected – that New York would be banning hydrofracturing activities, or “fracking,” going forward. An indefinite moratorium on such activities had already been in place pending a study about potential health effects of this oil and gas extraction process, but the results suggested that unknown potentially deleterious health effects should outweigh any fracking in any capacity whatsoever throughout the entirety of the state.
I accept that we are likely not fully aware of possible consequences of hydrofracturing, and that a certain degree of caution should be exercised; however, a fear of the unknown should not permanently and absolutely stifle all oil and gas activities throughout New York. To illustrate, most of us have been using cell phones for the past decade or so – in recent years, studies have been published that demonstrate that waves emitted by the devices most of us keep on our person or hold up to our head have the potential to cause cell mutation and may increase a person’s risk for cancer. Given this information, I am not aware of any family, friends or network connections whom have decided to stop using phones.
I have herein attached a scholarly article from 2013 discussing the juxtaposition on how oil and gas activity in Pennsylvania – and the lack thereof in New York in light of Cuomo’s ban/moratorium – has provided significant economic benefit for the former, and could have done so for the latter. For a state that seems to be hemorrhaging jobs yearly, it seems a bit presumptuous to just ban everything outright without considering methodologies for safe implementation.
I anticipate that there will now be suits filed in NY courts rooted in the 5th Amendment’s Takings Clause, arguing a sort of inverse taking, by preventing a citizen from selling resources located on his or her property. This may ultimately result in people being paid significant money by the state to not extract the resources, resulting in state taxpayer funds being funneled into resource owner bank accounts, and not money from the companies that would be creating jobs.
So, in one corner we have a job-creating resource extraction regime that, while not a perfect process, can be done in certain areas and ways that would mitigate most, if not all, potential side-effects. And in the other corner we have a total ban, resulting in no job growth, and the potential for the state to pay citizens money for the value of resources on their land which will NOT be extracted. The choice to me seems clear. I believe enactment of a limited oil and gas program in the state – alongside continued monitoring and studying – would be a great compromise that would allow economic benefit for citizens and small businesses, as well as ensuring that resource extraction is done safely and responsibly.