Townships of Findlay, Moon to sell water to drillers for airport fracking operations
By Timothy Puko
Published: Thursday, Aug. 29, 2013, 12:01 a.m.
Consol Energy Inc.'s big thirst could have a big payoff for residents near Pittsburgh International Airport.
The Cecil-based energy company is planning to buy its water from Findlay and Moon to supply all of its hydraulic fracturing operations, commonly known as fracking, when it drills for Marcellus shale gas under the airport.
Consol estimates it will need about 300 million gallons of water for fracking, in which water is blasted at high pressure to crack the underground shale rock and release the gas. It will drill 47 wells over four years — using an average of more than 1 million gallons a day.
That would immediately make the company the largest water customer for both townships, pumping millions of new revenue into the two municipal water authorities between 2015 and 2018, their managers said. Neither plans to cut rates, but the influx of cash will likely help keep rates stable while the authorities make needed pipeline and sewer improvements, they said.
“So it's a very big thing for our authority,” said Jason Orsini, general manager of the Findlay Township Municipal Authority, which serves 2,000 customers. “We don't want to just go out and borrow money, and then put that burden on the rate payers.”
Consol, which often buys drinking water from suppliers near its gas wells, is negotiating the details with both authorities but expects the two of them can fully supply what it needs, officials said Tuesday in announcing their airport drilling plan.
The company relies on municipal supply as a convenience and to give locals drilling business, spokeswoman Lynn Seay said on Wednesday. It has similar deals with the Southwestern Pennsylvania Water Authority in Greene County and the Municipal Authority of Westmoreland County.
What Moon and Findlay's authorities do with the money they will receive should be a public decision, said Joseph F. D'Andrea, a former planning commission member and school board candidate in Moon.
“It's a very delicate matter,” he said. “It's a very big project. And for a few people to make a decision for 26,000 is too many.”
Both suburbs are fast-growing communities with big infrastructure needs, but the authorities still have a responsibility to hold a public hearing before simply deciding to invest the money in capital projects, he said.
Consol is expected to pay about $500 million — a combination of upfront payments and royalties to the Allegheny County Airport Authority — to drill for gas under the airport's 8,800 acres.
The 1 million gallons of water that it estimates it will need daily is double what Findlay residents and businesses use, Orsini said. He said he expects Findlay to provide most of the water, but officials at both Consol and Moon said that is not yet certain.
If all the water came from Findlay, at the current retail rate of $7.94 per 1,000 gallons, it would bring in about $2.4 million in new revenue over the next four years. Moon has river access and a reservoir, making its water cheaper — $3.50 per 1,000 gallons — a total of $1.05 million if Consol bought all of its water there at the current retail price.
To meet Consol's need, Findlay may speed up a new $3.8 million water transmission line project, which it had started because of commercial development near the airport. It has applied for federal and state grants, and it is negotiating with Consol for possible help with the costs, Orsini said.
Both Findlay and Moon have other major pipeline and sewer needs, too, a common and costly problem in Western Pennsylvania.
“I think we see it as an opportunity to realize income and invest in infrastructure, but we don't have enough information to know its full magnitude,” said John Riley, general manager of the Moon Township Municipal Authority.
The airport authority may have helped the municipalities land the water supply deal. It put in its lease agreement with Consol that the company could not use any surface water for airport drilling. It didn't want drilling work to lead to any depletion or damming of local streams because of environmental concerns, said Randy Forister, its development director.
That was good news for the Montour Run Watershed Association, President Mark A. Fedosick said. The organization had tried to push Consol to use mine drainage for its water to help clean up the stream, but county officials feared that could cause more risk. The decision to use municipal water is a good compromise, Fedosick said.
“(Mine drainage) might have been a preference for us, but the bottom line is that as long as they're not withdrawing from the stream directly, we're happy with that,” he said. “I think we're cautiously optimistic.”
Timothy Puko is a staff writer for Trib Total Media.
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