Delaware Basin gas drilling hits a snag

The rush to pump natural gas from the hills surrounding the Upper Delaware River in Pennsylvania and New York has hit a regulatory speed bump.

In a move applauded by environmentalists, the Delaware River Basin Commission will require disclosure of chemicals used by natural gas drillers - a demand fought by the industry elsewhere - before it approves drilling in a layer of rock known as Marcellus shale.

"That's information our staff is going to need to know to review the application," Clarke Rupert, spokesman for the four-state commission, said today. "Our intent is not to prevent the drilling, but we want to make sure the proper environmental protections are in place," he said.

The Delaware River commission's mandate is to regulate both the use and the quality of water in the watershed, which is a major source of drinking water for the Philadelphia region.

"The DRBC is taking their mandate and using it most stringently," said Pat Carullo, a cofounder of Damascus Citizens for Sustainability, a group fighting for tighter regulations on drilling.

The natural gas industry has huge expectations for the Marcellus shale, a 365-million-year-old layer of rock that stretches from New York through West Virginia.

What concerns environmentalists and has attracted the close attention of regulators at the Delaware River commission is the use of 1 million to 3 million gallons of water mixed with fine sand and chemicals to open cracks in the shale to allow the highly pressurized natural gas to escape into the well bore.

That process is called fracturing. Suppliers of the fracturing fluid have resisted disclosing the chemical contents, saying they are proprietary. Industry critics, such as Carullo, say there is evidence that some of the chemicals are toxic.

Fracturing fluid is drawing regulatory attention in other parts of the country, as well. The Colorado Oil and Gas Conservation Commission adopted a rule last month that would require companies to keep inventories of chemicals used in drilling.

Only one Marcellus well has been drilled in the Delaware River Basin, according to the DRBC. The driller, Stone Energy Corp., of Lafayette, La., said last week that it expected to "fracture" the well in the fourth quarter.

Kenneth H. Beer, the company's chief financial officer, said today that he did not have enough information to comment on the DRBC's plan to find out what chemicals were in fracturing fluid.

Meanwhile, the nation's largest natural gas producer, Chesapeake Energy Corp., of Oklahoma City, is scaling back its leasing efforts in Pennsylvania, citing "regulatory issues and current economic factors" in a Sept. 4 letter to landowners with whom it was negotiating.

Chesapeake has leased 1.8 million acres in the Marcellus region. "We believe our investment has provided us with a very healthy leasehold," spokesman Matt Sheppard said.

Chesapeake's chief executive officer, Aubrey K. McClendon, touched on the fracturing issue last week. "We are not poisoning your water through our frac jobs," McClendon told a group of New York investment analysts.

Gaining permission to use water for drilling is slowing the natural gas industry's progress in much of the state, largely because the commissions for the Delaware and Susquehanna Rivers meet only quarterly.

The pent-up demand is great: At a Susquehanna River Basin Commission meeting tomorrow at Bucknell University in Lewisburg, Pa., nine companies will seek permission to withdraw up to 29 million gallons of water daily from the watershed for drilling.

Water demand will become even greater. Exxon Mobil Corp., with its record-breaking profits, was among five winning bidders announced last week for 74,000 acres of state-owned land in Pennsylvania. Bids totaled $190 million.