Report: Economic Consequences of Marcellus Shale Gas Extraction

By Susan Christopherson, PhD – Cornell University

Gas Pipeline Construction

The Economic Consequences of Marcellus Shale Gas Extraction report outlines some of the key issues explored by a team of researchers centered at Cornell University during the period of New York’s moratorium on high volume hydraulic fracturing (HVHF) for natural gas.  Our research focused on Pennsylvania, where Marcellus HVHF drilling has already begun, and on New York, which is still considering how to regulate HVHF, but we also made use of the experience of other states that have shale gas plays where HVHF has been in use far longer than in Pennsylvania.

At 17 pages, this report is a series of snapshots about what we found.  For a more fulsome account of our analysis and findings on most of these issues, we encourage you to read the complete working papers and policy briefs we have made available for download.

We launched this research project because it had become evident that the public and policy discussion over the consequences of Marcellus shale gas extraction had devolved to a polarized debate contrasting potential effects on water supplies with potential economic benefits – such as job creation.  The consequences for water resources were (and are) receiving a great deal of attention; the economic consequences were not.  We did not begin with a disposition for or against shale gas extraction, but we wanted to develop a realistic picture about what to expect, and about the economic consequences both in the short term and in the longer term.

As you will see in the report, the consequences that should concern us all go well beyond environmental concerns, and their economic implications include costs as well as benefits.  On balance, is shale gas extraction likely to be an economic winner? Not necessarily.  We conclude that while there are real economic benefits for some parties, if shale gas extraction is to be at all a positive force for economic development broadly and long term, it will require intensive planning and a new structure of regulation, monitoring and enforcement – along with the means to pay for it – that are not currently in place.

Susan Christopherson, PhD
Professor, Department of City and Regional Planning, Cornell University
Principal Investigator