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Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming

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Everyone is jumping all over the drilling company, but a vandal could of opened the valve. I'm not letting the company off the hook, they should have their sites secured. If someone wanted to make the drilling companies look bad then it wouldn't take much to open the valve and create a "disaster".

Posted on: 2010/11/23 10:57
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Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming

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Quote:
But if you leave room for avoidance of responsibility, then the profit motive will lead to avoidance of responsibility.


I agree with your "true cost" analysis. However, you are missing a huge point here. The government IS a company, and works the same way. You have to set up incentives for both company and government to achieve the end result we want, which is environmentally responsible extraction of natural resources.

Straight tax - ok, the gas companies pay more money. However, we don't solve any problems related to drilling. The companies have to pay it whether they behave or not, so they annie up, and continue on with the cheapest procedures from that point on. If anything, they cheapen up their procedures since their bottom line is now tighter. The government gets the money whether it enforces those regs or not, thus, it has no incentive to enforce those regs, and is free to use that money elsewhere if it finds other things politically more important (and it will). Lots of $ for state coffers, but not much of it will end up being used to prevent or repair environmental damage from drilling activities. In the end, its just a tax grab thats not designed to solve the very problem that justifies its existence.

Fines - The companies see a very real monetary incentive to follow the rules. If they follow the rules and act responsibly, they pay less money. But they pay enormous fines for screw ups that could lead to damage, and if it actually does lead to damage, they pay full cleanup in addition to those fines. Like you said, make them pay for the "real" cost of their activities, but not the cost of other gas companies, and suddenly the "cheap" option is the responsible one. On the other side of the coin, the government has a very real incentive to enforce the regulations. If they don't find anything wrong, they don't get any money. I want them scrutinizing these companies and looking for mistakes.

Posted on: 2010/11/23 11:00


Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming

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Both.........Tax , to be used first and foremost to beef up the inspection TU says it would take the current workforce of inspectors 9 wells a day 7 days a week 365 days a year to keep up with the amount of leases already given. Thankfully there is a moratorium on leases according to bikerfishs' post. And heavy fines for accidents like the one in Lycoming county and remember it was a DEP inspector who found the leak there. A good six figure fine could put another couple inspectors on the payroll.

Posted on: 2010/11/23 11:18


Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming

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6 figures likely not enough. The question isn't how to put a couple of more inspectors on the payroll. The goal is to make sure the only way for a company to turn a profit is to adjust its operating procedures so that these things are exceedingly rare. You want the company to feel strongly enough about it so that they employ their own inspectors, audit their own procedures, etc.

Posted on: 2010/11/23 11:26


Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming
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pcray writes:
Quote:
The government gets the money whether it enforces those regs or not, thus, it has no incentive to enforce those regs, and is free to use that money elsewhere if it finds other things politically more important (and it will). Lots of $ for state coffers, but not much of it will end up being used to prevent or repair environmental damage from drilling activities. In the end, its just a tax grab thats not designed to solve the very problem that justifies its existence.


I hate to say it, but you are letting your bias against government and in favor of free enterprise color and distort your thinking here. The tax can be structured to require it to go ONLY into the fund that supports vigilant oversight and remediation. Getting funds through fines alone does not provide the government the means to investigate and monitor. Thus, no company gets caught damaging the environment until it is too late, in which case, they have siphoned all the profits, folded up shop and will leave the public holding the bag like they did with coal mining and other industrial pollution that we have trying to clean up with tax dollars for half a century or more.

The tax should be based upon the reasonable liklihoods, which I would bet can be estimated by economists and scientists in the field to a reasonable degree of engineering and statistical certainty. I say make the estimate and impose the tax, then provide tax rebates to companies that take and discharge responsibility as they should.

I am done trusting these knights in shining armor that we call growth industries. We have every reason to believe they will use every leverage they have to avoid responsibility and in light of that, I say verify before trust, and not the other way around.

Posted on: 2010/11/23 11:26
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Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming

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Quote:
The tax can be structured to require it to go ONLY into the fund that supports vigilant oversight and remediation.


And you're letting your trust of government and workers cloud your judgement. Ok, lets say we make this fund and amazingly it doesn't get robbed by politicians looking for $ for other programs. Now we have all these hired inspectors. Great! What's their motivation to do a good job? The fund is there, and unless they screw up royally, they have a paycheck whether they do the job well or not. These sights are spread out all over the place in remote locations, so there's not going to be supervision on site. It's far easier for all parties involved to simply show up, check off the list that you checked this and that, and go home. Avoids confrontation, which is a motivation innate in humans.

Do we hire inspectors to make sure the inspectors are doing their jobs? No, the easiest motivation is to make their pay, or their department's pay, or whatever, dependent on finding fault. If there is no fault, well, then we don't need that many inspectors.

The key to getting everyone to play nice together is to set up the system so that the motivations are correct. I agree with a base tax to get the system set up. But beyond that:

#1. Companies have to really PAY for screw ups and be rewarded for good behavior. I'm not just talking about paying enough to clean up their own messes. I'm talking about enough to clean up their mess + fund the inspections + some extra punishment on top as an example to other companies.
#2. Inspectors have to be truly motivated to scrutinize every move.

I'm open to discussion on how to accomplish those things. But I will hold my ground that those 2 factors must play a serious part in any solution.

Posted on: 2010/11/23 11:54


Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming
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Well, the solution stares you in the face: you place a tax that extracts compensation for the true cost of inspections, regulating apparatus and expected harm, such as road and bridge wear and remediation of resources damaged, then you have the violation fines with incentives for both industry and the regulatory agency. I agree that both are needed. But, the industry is going to fight tooth and nail for less of a burden on them. The question is whether our government will fight equally hard to protect the interests of the Commonwealth. And, ulitimately the question we have to ask is whose side are we on in the struggle?

Posted on: 2010/11/23 12:06
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Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming

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There are no sides. Both sides want the same thing.

1. Both sides want the gas companies to provide money to our citizens and ultimately, local economies, in exchange for use of land.

2. Both sides want the gas companies to employ Pennsylvanians.

3. While we'd rather they employ all Pennsylvanians, them bringing in workers to stay in our hotels, eat in our restaurants, and shop in our stores is not a bad thing for us.

4. Both sides want the gas companies to provide heat and electricity to homes from domestic resources at reasonable rates.

Here's where our goals differ:

- The gas companies, by God, would like to make a profit while doing all this. We could care less about their profits.

- We demand the gas companies do as little damage as possible to the environment, the infrastructure, and our way of life while doing this. The gas companies could care less about the environment, the future of our infrastructure, or our way of life.

But we hold the cards, we're the boss. We need to basically reach an agreement. If they meet our demands on the environment and infrastructure, we'll allow them their profit. If they fail to meet our demands, we'll see to it that they never see a profit. No sides. They are not the enemy. They're more like children. They're good and we love them, but sometimes they need to be told the rules. When they follow the rules we'll allow them an allowance. When they disregard the rules, there needs to be punishment.

Posted on: 2010/11/23 13:03


Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming
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The whole children analogy loses me altogether. There will be a struggle between justice for the common folk and profits for the wealthy few just as there is in any public policy determination. Ignoring that reality just assures the people will come out on the short end of the stick.

Posted on: 2010/11/23 13:20
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Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming

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A company is not a wealthy individual, it's not an individual at all. It is a collection of people, which includes wealthy individuals in senior management, as well as many other levels of people, the vast majority which are the "working poor" that you make it your noble goal to defend.

A company's profits are not squirreled away somewhere for some rich guy to collect. When a company gets too much cash on hand, Wall Street scolds it. Thus, profits are either distributed among the lower employees, or invested into increasing capacity (i.e. hiring more people). Likewise, losses are either handled by decreasing the pay/benefits of lower employees, or laying people off.

Now, if you're arguing that the upper management gets too great a compensation when compared to the lower workers, I'm right there beside ya man, I agree. Unfortunately the rich at the top are insulated from this whole fight for profits. Their compensation is considered part of the bottom line, they get it whether the company succeeds or fails, which is ashame. The difference between profitable and not profitable is put squarely on the back of the "working poor" employees.

Further, the money for the programs you love so much comes from business taxes and personal income taxes solely from the private sector, both of which are dependent on profits of companies. When you cut into the income of companies, you take away money for government programs. Of course, this is necessary at times to protect resources and our future, it's a balance that must be achieved.

Nonetheless, attacking the company as a whole does not hurt those at the top as much as those at the bottom, the very one's you claim to try to help.

This is not a struggle between the common folk and profits for the wealthy. You are totally backwards. This is common folk's environment vs. common folk's income. The wealthy have set it up so that they are handsomly rewarded nomatter which side wins.

Posted on: 2010/11/23 14:48


Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming

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I agree with Jack. You have to take into consideration everything that needs to be done to fine these companies. You have a lot of cost incurred by the tax payer in paying the right number of inspectors, paying for everything that is entailed in the legal process, and of course, enforcing the fines should the company not pay. This is an industry that has no lack of funds available to remain viable and profitable. And as for any threats that they may make regarding pulling out of PA-does anyone really believe that? Where would they go? And if they chose to go, I think, that would be a corporate-minded decision. Let them make it and we can have our streams & woods back.
-Missy (Dave's Wife)

Posted on: 2010/11/23 19:14


Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming

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2008/1/21 19:15
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Here is a link that will take you to a University of Pittsburgh website that contains a link to a map that shows the various locations of Marcellus Shale drilling violations.

http://data.fractracker.org/cbi/snaps ... 6f27d11df9675c00b7e22e5d6

Here is a link, from the same site, that provides a list of Marcellus Shale drilling companies and their record of violations (so that you can get a sense of who runs the better operation).

http://www.fractracker.org/2010/11/ma ... olations-by-drilling.html

The thought did occur to me that it could have been an act of vandalism-however I believe that the article said the company had no attempt at explanation of how the valve could have been open. They didn't cite vandalism.

-Missy

Posted on: 2010/11/23 19:38


Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming

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David,

The 2nd link was very informative, thank you. Shows the wide variation between companies. What I'm saying is that the total cost to the company to stay in business should be highly dependent on these type of numbers. High violation rate should equal a loss of money, and lower violation rates should equal profit.

Posted on: 2010/11/23 21:11


Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming

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2008/1/21 19:15
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I think one needs to define responsible drilling. If injecting a cocktail of toxic chemicals into the ground at high pressure then storing the waste fluids in a reservoir to evaporate then covering it with dirt before you leave is responsible, well, by all means. Accidents need to be prevented, but I think it might be just as well to look at the total picture of what the process truly is. Why is the industry exempt from the Clean Water Act? You may already know there are some good videos on You Tube from people in PA that have wells on their land. Hickory PA seems to have quite a few. Corbett is going to side with the industry, regardless. They paid him hundreds of thousands of dollars to do just that-hence, the tax free drilling plan. (oh, and they paid Onorato much less than that).

I've attached a picture of a wild trout stream from one of our trips to Sproul State Forest.

Attach file:



jpg  P5160131.JPG (523.82 KB)
1328_4cec7d40e7ca4.jpg 800X600 px

Posted on: 2010/11/23 21:36


Re: 13,000 Gallon Frack Fluid Spill in Penn Township, Lycoming

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2009/4/1 21:52
From Johnstown, PA
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WOW!!! Missy/David those links are really good , where is Dimock in relation to Scranton , the number of infractions is disturbing to say the least. The number of companies is also to me anyhow disturbing. When looking at those links i get a feeling of being overwhelmed. I pray we are not too late already , please , anyone who has operations close enough to them that they can keep an eye on them , do so , talk to the workers if you can , remember the workers are just folks like most of us and will talk about what they do if you are willing to listen.

Posted on: 2010/11/24 6:28



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