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Legislative Memo

Darren Suarez
Manager of Government Affairs
T 518.465.7511
www.bcnys.org

BILL:

A.2108 (Lifton) / S.893 (Krueger)

Support

SUBJECT:

Natural Gas Extraction Liability Act

 

DATE:

June 1, 2011

 

The Business Council opposes this legislation which would institute a standard of “joint and several liability" for any damages resulting from operations, exploration, extraction or transportation activity relating to natural gas exploration.  Liability for such incidents would extend to landowners entering into leases for natural gas exploration.  

Under existing law damages can be recovered from drillers and landowners who have allowed drilling on their property when it is proven that the damage was caused by the negligent conduct of the driller or landowner. If enacted into law, this bill would allow for damages just based on a causal connection between the drilling and the related activity.

This would no longer incentivize landowners’ willingness to lease lands for natural gas development. A land owner would be just as responsible for any adverse incident relating to a natural gas well as any company or other party.  The benefits of natural gas development would be lost to the potential flood of lawsuits this absolute liability standard would bring.

Hydraulic fracturing has been safely employed in New York for over 60 years under the regulatory oversight of the DEC. The Department’s ongoing and long-standing regulation of hydraulic fracturing has proven sufficiently protective of groundwater resources and will continue to be protective under the enhanced permitting requirements proposed in the SGEIS.

Hydraulic fracturing is a proven technology that has allowed natural gas producers to safely and economically recover natural gas from deep shale formations across the country.  It is vital to today’s shale gas revolution, which is reducing reliance on foreign oil, lowering air emissions generated by dirty coal, and vastly increasing America’s supply of clean natural gas.  

Thousands of horizontal wells have been drilled across the United States with hydraulic fracturing without contamination. Our neighbor to the south is a testament to the success of this drilling. Economic revitalization is underway across Pennsylvania’s northern border.

This proposal would significantly reduce New York’s full drilling potential, delaying economic development opportunities, jobs and economic growth for many financially strapped communities.

Natural gas production will yield extensive new job opportunities, provide increased state and local tax collections and boost local economies and provide long-term growth particularly to the Southern Tier, an area in desperate need of economic growth.  

For these reasons the Business Council recommends against approval of A.2108/S.893.