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Pennsylvania Game Commission reaps revenue from shale gas under game lands

| Sunday, Nov. 29, 2015, 9:40 p.m.
Gas wells near State Game Land 117 in Washington County on Friday, Nov. 27, 2015.
Sidney Davis | Trib Total Media
Gas wells near State Game Land 117 in Washington County on Friday, Nov. 27, 2015.

Gov. Tom Wolf's reinstatement this year of a ban on new leases for oil and gas drilling beneath state parks and forests does not extend to land owned by the Pennsylvania Game Commission, whose lease revenue has increased nearly fivefold in four years.

“Because the Game Commission is an independent agency, we could not bind them to an executive order,” said Wolf's spokesman, Jeff Sheridan.

The commission's revenue from such leases increased from $4.7 million in fiscal year 2011 to $22.1 million, or 20 percent of its $100.5 million budget in the fiscal year that ended June 30. The money helps support operations and training of new staff at the agency.

Three shale gas producers will pay the most to the commission this year in lease fees and royalty payments: Seneca Resources, $2.9 million; Southwestern Energy, about $2 million; and Chesapeake Energy, $857,000.

The operations benefit hunters with upgraded access roads, said Seneca spokesman Rob Boulware. The company and the Marcellus Shale Coalition have worked with hunters to make sure there are no safety issues, he noted, such as during the deer season that starts Monday.

“A lot of our folks, because we've been here for over 100 years … our employees live in these areas where we work,” he said, adding that many employees hunt.

Drilling has increased greatly over the past decade with shale exploration, but industry activity on state land and the Allegheny National Forest dates back more than a century.

In 2010, then-Gov. Ed Rendell banned new oil and gas development in state parks and forests. Gov. Tom Corbett in May 2014 sought to allow new shale drilling as long it did not increase surface disturbances — roads, rigs and supporting infrastructure — on the land.

In reinstating the ban in January, Wolf said the state needs to strike a balance between getting money from resources and maintaining “the economic and environmental viability of our parks and forests.”

The game commission has leases dating to the 1960s, said Michael DiMatteo, its chief of environmental planning and habitat protection division. Of its 120 active gas, oil and coal leases, 45 are for shale gas extraction. Of those, 24 allow surface operations on the game lands. Companies must access the gas horizontally from adjoining properties in the other leases.

Southwestern holds gas rights below about 2,300 acres of Game Commission land. Its 18 wells tapping that gas lie on private property adjacent to the game lands.

About 89,000 of the commission's 1.5 million acres are under lease, DiMatteo said. Shale activity impacts about 855 acres on 24 game lands, including locations where the commission does not own the gas rights beneath.

Most of the commission's available land has been leased, the agency said. But it signed several recent deals:

• Vantage Energy agreed to pay $342,300 and 18 percent royalties for three years to tap gas beneath Game Land 223 in Greene County.

• Chevron agreed to pay $641,100 and 18 percent royalties for a four-year lease involving 214 acres beneath Game Land 223. The company has operations on surrounding land.

• Chevron will pay $645,000 and 18 percent of sales for gas beneath Game Land 238 in Fayette County.

Royalties that the commission collects go to the game fund to pay for salaries, maintenance of game lands and habitat improvements, DiMatteo said. The commission, which is not supported by tax dollars, receives most of its income from the sale of hunting licenses, fees for which have not increased since 1999, said spokesman Travis Lau.

The most recent class of cadets that passed through the commission's officer training program would not have been possible without the lease money, Lau said.

The commission used some of the money to buy 28,300 acres with high habitat value to offset the surface activity from the shale work, DiMatteo said.

Environmental advocates would like more input on leasing. The commission should publish a detailed map showing areas that are off-limits to gas development, said Larry Schweiger, CEO of PennFuture, a Harrisburg-based environmental group.

“If the game commission is holding a large block of forest lands that are unbroken, you don't want to fracture those lands and fracture the habitat where are important wildlife on those lands,” Schweiger said.

Lau said the commission accepts public comments at its quarterly meetings and includes maps of areas to be leased in agendas.

“We do consider sensitive areas such as wetlands and habitats on which threatened and endangered species have been documented as off-limits to drilling,” he said.

Tory N. Parrish is a staff writer for Trib Total Media. She can be reached at 412-380-5662 or tparrish@tribweb.com.

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