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Don't drill near our water, New York City says

New York City is seeking a ban on natural gas drilling in its watershed, adding key support to critics who consider the chemicals used to mine for shale gas as poisonous to drinking water.
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The 260-foot-high Kaaterskill Falls is part of New York's Catskill Mountains, part of which lie inside New York City's watershed.Jim Mcknight / AP
/ Source: Reuters

New York City urged state lawmakers on Wednesday to ban natural gas drilling in its watershed, saying the process used to extract the shale gas threatened the city's drinking water.

Shale gas trapped deep underground is considered one of the most promising sources of U.S. energy, and the biggest city in the United States has joined environmentalists and small-town neighbors of drilling operations in trying to limit its exploitation.

The drilling process known as hydraulic fracturing, or "fracking," involves blasting through rock with a mixture of water, sand and a proprietary list of chemicals that are used to split the shale formation and free trapped gas.

"Based on the latest science and available technology, as well as the data and limited analysis presented by the state, high-volume hydrofracking and horizontal drilling pose unacceptable threats to the unfiltered fresh water supply of nine million New Yorkers," the city's acting Department of Environmental Protection Commissioner, Steven Lawitts, said in a statement.

"These activities cannot be permitted in the watershed. The risks are simply not worth it," Lawitts said, putting the city at odds with the gas industry, which considers shale drilling completely safe.

New York City's opposition marks the first time someone from Mayor Michael Bloomberg's administration has formally asked for a pre-emptive ban on gas drilling.

The city's 2,000-square-mile watershed is the largest unfiltered water supply in the United States, providing 1.4 billion gallons of drinking water a day to millions.

It is also within the Marcellus Shale formation, which geologists say could satisfy U.S. natural gas demand for a decade or more, and local business groups say would provide much-needed revenue to the cash-strapped state.

If drilling were permitted, New York City says it might need a $10 billion water filtration system that would cost an additional $100 million a year to maintain and translate into a 30 percent increase in residential water and sewer costs.

Earlier this year, New York state proposed new environmental rules that would allow drilling for natural gas in the Marcellus Shale formation.

'Stillborn' idea?
Major natural gas producers and oilfield service companies like Schlumberger Ltd. and Halliburton Co. have a stake in shale gas production, and Exxon Mobil cited the potential for unconventional gas production in its $30 billion bid to take over XTO Energy this month.

The deal includes a clause that would allow Exxon Mobil to back out if the U.S. Congress bans or severely regulates the process used to extract gas from shale rock.

Subash Chandra, an energy analyst at Jefferies & Co., said that national political pressure for tighter regulation was already increasing and unlikely to be influenced by New York.

"The idea of watershed drilling was a stillborn concept," Chandra said.

Some companies like Chesapeake Energy Corp had announced they would not seek to drill in the New York watershed, which lies about 90 miles north of the city.

Chandra said the industry had anticipated the ban and companies may simply focus on the Marcellus Shale formation in Pennsylvania. The formation, likely the nation's largest shale reservoir, extends below the surface in much of Pennsylvania and parts of New York, Ohio and West Virginia.

Terry Engelder, a Penn State University professor of geosciences, said New York City's demand may improve prospects for passage of the "Frack Act" — federal legislation that would require gas companies to disclose the chemicals they use.

"It shines a brighter light on the Frack Act because New York is a significant enough fraction of the U.S. population that care will be taken," he said.

There are more than 200 "introduced" chemicals used in fracturing but details of how they are used are not published by energy companies. They are not required to disclose it because of an exemption to a federal clean water law granted to the oil and gas industry in 2005. That exemption has made it hard for critics to prove their case.

Shale drilling companies say the industry maintains strict safeguards to prevent any danger to water supplies.

They argue that the fracturing chemicals are heavily diluted, and are injected through layers of steel and concrete into the shale a mile or more underground and thousands of feet below aquifers, so they cannot mingle with drinking water. Industry officials say there has never been a documented case of water contamination from gas drilling. Some fracturing chemicals are also used in household products, which may explain their presence in water tests, energy companies say.

EPA found contaminants
But neighbors of drilling in several states complain of water that is discolored, foul-smelling, bad-tasting, and in some cases even black. Some say drinking it causes sickness and bathing in it causes skin rashes.

In a few cases, water has become flammable because methane has "migrated" from the drilling operations to water wells, a fact that has been confirmed by regulators in Pennsylvania. Many low-income people who live near gas rigs drink bottled water, and some have their water supplied by the gas company.

The U.S. Environmental Protection Agency found 14 "contaminants of concern" in 11 private wells in the central Wyoming farming community of Pavillion, an area with about 250 gas wells. The August report did not identify the source of the contamination but is conducting more tests and is expected to reach a conclusion by spring 2010.

In Pennsylvania, at least two privately conducted water tests near gas drilling have also found chemical contamination. One set of tests is being used in a lawsuit by a landowner against the gas company.

Around a third of the millions of gallons of water used in fracturing comes back to the surface where it is either reused or trucked to treatment plants. In Pennsylvania, where the industry is rushing to exploit the massive Marcellus Shale formation, critics say there isn't enough capacity to remove toxic chemicals from waste water. As a result, some waste gets pumped into rivers and creeks with little or no treatment, critics say. Some residents have accused tank trucks of dumping waste water on rural roads.