Posts

A Fresh Look at Oil and Gas Drilling from Europe

By Ted Auch, Kyle Ferrar, and Samantha Rubright with Max Gruenig

Fourteen days is not nearly enough time to fully understand the complex differences between oil and gas drilling issues and policies in the United States and several European Union countries. The EU’s drilling policies, geography, and the industry’s level of activity are quite distinct from those of the States in some cases. Still, as part of the Our Energy Solutions project, four staff from FracTracker Alliance and Ecologic Institute attempted to understand and share as many lessons-learned in Europe as we could in the first two weeks of September. Our interest covered all aspects of oil and gas development, but focused on those relating to the use of stimulation techniques (hydraulic fracturing – fracking) in unconventional reservoirs. Even with significant differences between the US and EU, there is still much to be gleaned in sharing our regulatory approaches, community concerns, and environmental challenges.

“Chaos is merely order waiting to be deciphered” ― José Saramago, The Double 

London, England Meetings

The House of Commons meeting was held in Parliament, just below London's Big Ben

The House of Commons meeting was held in Parliament, just below London’s Big Ben. Photo by Sam Rubright

Our European tour started in London with Ecologic Institute’s Max Gruenig. The first stop was a meeting with University of Salford Professor of Regeneration and Sustainable Development Erik Bichard outside of The Palace of Westminster. Erik has worked extensively to understand and chronicle common threads that weave together community response(s) to hydraulic fracturing (fracking) proposals. Much of Erik’s research in the UK has focused on the efforts of the leading shale gas extraction company in the EU, Cuadrilla Resources, to employ hydraulic fracturing technologies, as well as local oppositions to this development. The major points of contention are in Lancashire County, Northwest England and Balcombe in West Sussex. Erik pointed to the fact that Cuadrilla admitted their claims that the 4% decline in UK energy cost was a result of Lancashire oil and gas exploitation were significantly overstated. Such manipulative statements appear to be cut directly from North American energy’s playbook.

House of Commons meeting, London

House of Commons meeting, London. Photo by Sam Rubright

We then attended a spirited Fracking with Nature Meeting at The House of Commons hosted by 21st Century Network and convened by MP Cat Smith (photo right). Many, if not all, of the attendees were concerned about the negative impacts of fracking and oil and gas development in general, but perhaps the event’s purpose self-selected for those attendees. We found the conversations to be very advanced considering that the UK has not seen nearly the same level of oil and gas activity as the US. Most questions centered on the potential for fracking to negatively impact ground water, followed by the induction of earthquakes. Air quality was not discussed as often, despite the serious risks that oil and gas air pollutants pose to health, and the frequency and severity of ambient degradation reported in the US. With the UK’s move to cut subsidies for renewables and a push toward fracking, these concerns may soon become a reality.

We later met with one of the speakers at the House of Commons meeting, Damien Short LLB, MA, PhD, Director of the University of London’s Human Rights Consortium[1] and the Extreme Energy Initiative.[2] NGO’s, we learned, are on the forefront of the issue, debating the need to prioritize community health over corporate profits. They have had quite a lot of success on this front, despite Tory projections.[3] The past state of UK politics under the direction of PM David Cameron, was supportive of extractive industries and corporate interests, blocking any attempt to introduce regulations. Even with the defeat of David Cameron’s administration, new “fast-tracking” rules to accelerate permits for fracking passed in August.[4] The overwhelming victory of democratic socialist Jeremy Corbyn as the leader of the opposition Labour Party – means that the tenure of the current fracking moratoria in North Yorkshire, as well as in Scotland, Wales, and Northern Ireland[5] could be brief.

Our time in London was filled with several other meetings, including one with Greenpeace UK’s new fracking coordinator, Hannah Martin. During our meeting she indicated that while Greenpeace was sympathetic to the views and tactics of Mr. Corbyn, they were concerned that his election would further divide Labour. In her opinion this change could allow the oil and gas sympathetic – and united – Tories to expedite their vision for fracking in the UK.

Regardless of the similarities between community concerns and industry tactics, however, one difference between the UK and US was crystal clear; no matter their view on the use of fracking, Brits support a substantial Petroleum Revenue Tax (PRT) rate to the tune of 50-60%. The PRT will fall to 35% in January, 2016, however. This latter figure is a sizeable decrease but would still be 40% higher than the average in the US.  California for example, the fourth largest producing state, does not and has never levied a severance tax.[6] Unfortunately, the UK is seeing similar conflict of interest issues and deliberate attempts to de-democratize the rule-making around fracking, as demonstrated in a recent move to prevent a proper parliamentary debate about drilling under protected areas in the UK.

Brussels, Belgium Workshop and Meeting

After the European Commission meeting

Geert, Max, Kyle, and Ted after our meeting with the European Commission in Brussels. Photo by Sam Rubright

The next phase of OES Europe took us to Brussels to host a community workshop and meet with members of the European Commission’s Directorate-General for Environment. Both events brought to light many concerns and questions about drilling’s safety.

The European Commission is currently drafting a best available techniques reference document (BREF) regarding hydrocarbon extraction for the European Union to consider in December 2015. The recommendations will build upon the “Minimum Principles,” published in January, 2014.[7] Representatives from the European Commission asked us about a variety of concerns that have arisen from drilling in the US, and how Europe might have similar or different experiences. The Commission was most interested in environmental health risks and research focused on exposure to air pollutants, as well as other degraded environmental media (drinking water, soil, etc.). We also shared figures about water consumption, land use, and waste management. It was immediately apparent that the lack of high quality publicly accessible data in the US is making it very difficult for the Commission to make well-informed decisions or policy recommendations. This meeting was arranged by Geert De Cock, of Food and Water Europe, and – interestingly – was one of the first times that the European Commission met with non-industry representatives. (Several major oil and gas players have offices near the European Commission’s in Brussels.)

Rotenburg (Wümme), Germany Workshop

Presentations during Rotenburg Germany workshop, Sept 2015. Photo by Kyle Ferrar

Max presenting during the Rotenburg Germany workshop, Sept 2015. Photo by Kyle Ferrar

Our next stop in Germany was Rotenburg. Lower Saxony also has a long lineage of drilling, with the first well drilled in 1953 and the majority of natural gas development dating back to the mid 1980’s. Currently, this is an area were unconventional oil and gas drilling (fracking) is being heavily proposed and lobbied.

This workshop was by far the most well attended event. A variety of groups and stakeholders, including the town’s mayor, were in attendance and extremely well informed about environmental and public health risks that drilling could pose. They’ve been dealing with a series of environmental health concerns for some time, including high mercury levels in drilling waste and cancer clusters of questionable origin. A systematic statistical analysis has even suggested that cases of Non-Hodgkin lymphoma are higher in an area heavy with oil and gas wells and development.

See maps below for more information about drilling in Germany and Europe at large.

Unconventional gas production, conventional gas drilling, fracking and test boring in Europe
Map by Gegen Gasbohren (Against Gas Drilling)

View Gegen Gasbohren’s map fullscreen

A dynamic map similar to the one above was created by us to show simply where unconventional drilling is occurring in the UK and Netherlands:
View FracTracker’s map fullscreen

Rotenburg Field Tour

The following morning we set out with a local advocate, Andreas Rathjens, to tour over eight different oil and gas drilling sites and facilities in and around Rotenburg. This area is vey rural and a major agriculture hub, hosting 162k people, 200k cows, and 600k pigs according to our guide.

In recent years Germany has received very positive scores for its environmental policies and shift toward renewables. However, this tour highlighted some of the country’s lingering and poorly-regulated drilling history, which experienced a sharp increase in development here in the 1980’s. The pictures below will give you an idea of the issues that German residents are is still seeing from the country’s older oil and gas drilling operations. Click to enlarge the photos:

Rotenburg, Germany surface water runoff pond on a gas well pad in production

This pit is used to capture rainwater and runoff from the well pad. Since runoff from the pad will carry with it any contaminants spilled on the site, runoff must be quarantined for removal and proper disposal. Unfortunately, these tanks are rarely pumped and drained, and the runoff instead spills into local streams in small watersheds. Such is the case with this tank, with the spillway visible in the lower left corner of the photo.

IMG_0063

This site was recently renovated to improve the drainage off of the wellpad. The drainage leads to an excavated waste pit used as an overflow catchment.[8] In these types of waste pits pollutants evaporate into the air and percolate into groundwater sources. The waste from drilling in this region is known for its high levels of mercury.

Andreas showing us the site where he says 80,000 metric tonnes of solid waste from oil and gas drilling was mixed with residential waste and then disposed of in a field on top of a hill. Residents have tested the site and found troubling levels of arsenic and radioactive elements, but to Andreas’ knowledge no governmental or company testing has been done to-date.

Andreas showing us the site where he says 80,000 metric tonnes of solid  drilling waste was mixed with residential waste and then disposed of in a field on a hilltop. Residents have tested the site and found troubling levels of arsenic and radioactive elements, but to Andreas’ knowledge no governmental or company testing has been done to-date.

Andreas and community members all conveyed their support of domestic energy production but said they were disappointed in how the oil and gas industry has conducted itself historically in the region. They are very frustrated with how difficult it is to get their concerns heard, a sentiment echoed in many boomtowns across the US. One local politician even discussed the intentionally misleading statements made by the German state governments around environmental health issues. These residents are dedicated and driven despite the barriers, however. They are investigating and studying the problems directly at times, as well as searching for other technologies that can help improve their methods – such as the use of drones to measure air quality.

Badbergen, Lower Saxony, Germany Workshop

Fracking-freies Artland hosted our next workshop in Badbergen Germany. In addition to our presentation about drilling experiences in the US, these community gatekeepers led a presentation summarizing the work and struggles that have been occurring in their region due to both historic and modern drilling. The level of community engagement and activism here was quite impressive, mirroring that of NY State’s anti-drilling groups. These members help to inform the rest of the community about environmental and drilling issues, as Exxon is now considering fracking here again.[9]

Schoonebeek Tour, Netherlands

Our final border crossing brought us to the Schoonebeek region in the Netherlands. While the Groningen gas field is by far the largest of the fields in this Western European country, Schoonebeek is the only active field being drilled unconventionally in the Netherlands.

OES-Europe-Home

Interestingly, the entire field was recently shut down by NAM Shell/Exxon JV to fix this wastewater pipeline. It was discovered that the pipeline was leaking wastewater in nine places due to corrosion caused by the high sulfur content of the wastewater.

Upon starting our tour we were informed of the fact that the Dutch have an even higher extraction tax than the UK! The Netherlands retains a 50% State Profit Share for revenue and taxes the remaining production at a rate of 20% on the first $225,000 in revenue and “25% on the excess.” In comparison, the highest production tax rate on oil and gas drilling in the US is in Alaska at 35%. Most states have significantly lower severance taxes.[10]

Political support for higher taxes on the extractives industry may be explained by the fact that the state owns all subsurface mineral rights in these European countries. Regardless of other influences on perception, such high taxes disproves the notion here in the US that energy companies “won’t do business in a state [or country] with a newly-enacted punitive severance tax.” What do the states do with this extra revenue? The Netherlands and many Northern European countries have invested these monies for the rainy day when the oil and gas supply is depleted or extraction is no longer justifiable. The best examples are Norway’s $850 billion Government Pension Fund and Netherland’s $440 billion pension fund or $169,000 and $26,000 per capita, respectively.

Additional support for severance taxes is likely due to these countries’ history with oil and gas exploration. They are familiar with the boom-bust cycles that come with the initial expectations and long-term reality on the ground. When the music stops, Europeans are determined not to be the ones left standing.


About the Our Energy Solutions Project

This trip to Europe and our previous expeditions to Florida, North Carolina, Argentina, and Uruguay are part of a larger, collaborative project with Ecologic Institute US called Our Energy Solutions. OES is creating an informed global community of engaged citizens, organizations, businesses, governments, and stakeholders to develop ideas and solutions to keep our society moving forward while preserving our planet for the future. Learn more at: ourenergysolutions.org.

On a more personal note, our sincerest thanks goes out to the many groups and individuals that we met on our Europe tour, including those we did not directly mention in this article. We are forever indebted to all of the people with whom we met on these OES trips for sharing their time and knowledge with us.

Endnotes and References

  1. Dr. Short is currently advising local anti-fracking groups in the UK and county councils on the human rights implications of unconventional (extreme) energy extraction processes such as fracking.
  2. Dr. Short and collaborators were recently granted an opportunity to put fracking on trial at hearings to be held by The Permanent Peoples’ Tribunal (PPT) in the UK and the US.
  3. Much of the ammunition used by the anti- or undecided fracking community in the UK – and the EU writ large – is coming from proofs of concept in states like Pennsylvania, Ohio, New York, and North Dakota.
  4. Gosden, Emily. 8/13/15. Fracking: new powers for ministers to bypass local councils. The Telegraph. Accessed 10/25/15.
  5. Strachan, Peter. Russell, Alex. Gordon, Robert. 10/15/15. UK government’s delusional energy policy and implications for Scotland. OilVoice. Accessed 10/25/15.
  6. California, instead, imposes a statewide assessment fee.
  7. European Commission. 1/22/14. Fracking: minimum principles for the exploration and production of hydrocarbons using high-volume hydraulic fracturing. Eur-Lex. Accessed 10/26/15.
  8. A practice that is supposedly now being investigated for soil contamination issues.
  9. Exxon originally wrote in the local/regional paper that there was to be no unconventional shale drilling (fracking), but now the company is reconsidering.
  10. Please note that the cited article was last updated in 2012. Some tax rates have changed since the time that the article was published, but the table still adequately represents an estimation of production taxes by state.

To Severance Tax or not to Severance Tax, that is the question!

By Ted Auch, PhD – OH Program Coordinator, FracTracker Alliance

Million Cubic Feet (MCF) as measured over industry standard test periods.


Barrels of Oil Equivalents (BOE) as measured over industry standard test periods.
Figure 1. Ohio’s Producing Utica Wells & Primary Shale Geology – plus non-reporting, drilled, or producing Utica & Marcellus Wells.
“Million Cubic Feet” (MCF) as measured over industry standard test periods.
“Barrels of Oil Equivalents” (BOE) as measured over industry standard test periods.

The economic opportunities provided by Ohio’s Utica Shale play via hydraulic fracturing have been cited repeatedly by the Ohio Oil and Gas Association and industry think-tanks like IHS Inc [1]. Numbers published by the latter last October [2] predicted 143,000 Ohio jobs and $18 billion in state revenue by 2020. However, these projections are accompanied by substantial amounts of error. Given that the state’s Utica Shale well movement is now more than 500 wells permitted strong, we thought it was time to take a closer look at the demographics and economics of the Utica Play, given that there will be a strong geographic component being inserted into the “To Drill Or Not To Drill” and waste disposal debate here in Ohio. This is an especially important issue given that the state is wrestling with either implementing an ad valorem [3] tax or raising the state’s industry-low severance taxes, which currently stands at 0.5-0.8% but would be raised to 1% under the governor’s budget. In contrast, proposals from Policy Matters Ohio and northeast Ohio Democrats seek 5% – 7%, respectively.

In comparison to most other states producing oil and gas, even 5% may be a trivial amount, or what The Cleveland Plain Dealer called “indefensibly low.” It amounts to 97 cents per Ohioan (i.e., $275 mi2) [4]. According to an Ernst & Young analysis of eight states that produce dry gas and natural gas liquids and/or dry gas and oil…

  • Ohio currently imposes the lowest combined state and local taxes of the states included in the analysis.
  • …Ohio’s overall effective tax rate (measured as total taxes divided by sales) is 80% below the average rate for the other 7 states for a well producing dry natural gas and natural gas liquids.
  •  For a well producing dry natural gas and oil, Ohio’s effective tax rate is 65% below the other-state average…
  • With the [proposed] increase, Ohio’s effective severance tax rate (ETR) would be 16% lower than the other states’ average for the well producing dry natural gas liquids and 4% lower than the other states’ average for the well producing dry natural gas and oil.

The governor’s proposed “Severance Tax Changes” will not apply to any Marcellus Shale wells, even though the state is home to five producing Marcellus wells (two in Monroe County) and eight permitted wells across Belmont and Monroe Counties. Additionally, the governor and his staff included a severance tax exemption for all “small-volume gas wells” (gas wells with average daily production of under 10 million cubic feet [MCF] would be exempt from the tax). If early industry production reports – and the Ohio Business Roundtable requested Ernst & Young report – are any indication, only 19% of wells will be subject to this tax. Our own analysis revealed that of the 32 industry reported production wells, the average production value is 7.5 MCF (Figure 1).The Kasich administration admitted the exemptions would apply to – by their estimation – 45,000 gas wells.

Another nuance of the Kasich administration’s severance tax complicated mélange is that rates will be 1% for natural gas and 4% for oil, natural gas liquids, and condensate. However, according to the administration:

… there will be a lower tax rate of 1.5 percent for the first year of production, in order to allow producers to recover the cost of preparing the well site and drilling the well.

Coincidentally, “the first year of production” is generally the time of greatest gas yields. Anonymous sources in Ohio’s Utica sweet spot have spoken of 50% declines in royalties within 6 months of production.

The Ohio Oil and Gas Association, the industry’s lobbying arm, has weighed-in against higher severance taxes, stating that:

a 4% severance tax on oil and gas would be equivalent to a 40% income tax and 16 times more than the commercial activities tax (or CAT). It would also burden economically challenged area throughout the state and landowners who want to lease their land and receive royalty streams.

(Total of 4,037 individual donations, Data courtesy of Common Cause Ohio’s “Deep Drilling, Deep Pockets: Campaign Cash and Fracking Regulation in Ohio” spreadsheet)

Figure 2. Ohio’s Big Energy individual or Political Action Committee (PAC) political donations from 2001 to 2011. (Total: 4,037 individual donations. Data courtesy of Common Cause Ohio’s Deep Drilling, Deep Pockets spreadsheet.)

The anonymous BizzyBlog took the OOGA position one step further proclaiming that energy companies “won’t do business in a state with a newly-enacted punitive severance tax.”

Such arguments against a “hefty tax increase” don’t have much empirical support. OSU oil and gas development expert Douglas Southgate called such taxes “definitely affordable for the industry.” Even with the increases proposed by some, Ohio would still rank lowest among the eight shale gas producing states investigated by Ernst & Young in 2012.

Whereas an ad valorem tax would be redistributed directly back into the communities from which the hydrocarbons are extracted, a severance tax would be distributed throughout the state, even to communities and counties that prohibit Utica Shale drilling and/or injection activity. Theoretically, the entire state could benefit from the toils and environmental risks taken on by Ohio’s Appalachian region. According to a Quinnipiac pole, Ohioans support (52 to 38%) an increase in drilling-related severance taxes. Bipartisan voter support for a severance tax increases (60 to 32%) when the prospect of offsetting state income taxes is proposed.

Either levy – an ad valorem tax or severance tax – would be based upon the industry’s headline well production, even though USGS research recently spoke to the substantial well-to-well production variability in the Appalachian Shale Basin: 250-600% [5]. There are quite a few short- and long-term costs and benefits associated with exploitation of the Utica Shale; however, as it stands the risk burden is disproportionately being shouldered by Appalachian Ohio. Thus, the severance tax being proposed by the governor and House Democrats could add to the regional schisms evident in the state.

But maybe geography is immaterial. The likely big winner of the tax decisions will be energy companies and, according to data on recent campaign contributions, those politicians they deem worthy of their political donations – many of whom are on the fringes or completely outside the Utica Shale (Figure 2).


[1]  IHS Global Insight is the brainchild of Daniel Yergin.

[2] This work was funded by the US Chamber of Commerce’s Institute for 21st Century Energy, the American Petroleum Institute, the American Chemistry Council, America’s natural Gas Alliance, and the Natural Gas Supply Association.

[3] Ad valorem taxes are assessed according to the value of the natural gas extracted.

[4] The Kasich “Ohio’s Jobs Budget 2.0: Jobs. Momentum. Transformation” highlights this aspect of their proposed severance tax, explicitly noting that it “has researched the severance tax structures of other states with significant oil and gas production, particularly those states with shale resources, and has found that even with a 4 percent tax rate, the tax burden on the revenues from these horizontal Utica wells will be lower than in other states.”

[5] According to the USGS, production from the most productive wells in the Appalachian Basin’s shale formations is commonly 50 times larger than the poorest producing wells, with the same value being 250-600 times larger for the Marcellus Basin. However, the only numbers presented to individual landowners – but less frequently to collectives given that energy firms are increasingly aware of the legal advice that land aggregators are seeking out – when the subject of royalties comes up are near-term gushers. For example:

  1. GPOR’s “’King’ of Utica Well” the Shugert 1-1H at 4,913 barrels of oil equivalents per day (BOEPD),
  2. CHK’s Buell well in Harrison County, OH producing 1,040 BOE[5],
  3. GPOR’s Boy Scout 1-33H in Wagner, Harrison County producing 3,456 BOE, the Ryser 1-25H producing 2,914, or the Groh 1-12H producing 1,935 BOE,
  4. Anadarko’s 9,5000 BOE, and
  5. The Wagner 1-H well producing 4,650 BOE. Yet, wells like the Frank unit in Stark County owned by Enervest producing 515 BOE or the non-producing wells across Ashland and Medina Counties are barely discussed – what a JP Morgan energy analyst called a “funding gap.”

Severance Tax vs. Impact Fee, Revisited

It may not seem like it when you head to the pump, but the price of oil has plummeted in recent months. After peaking near $114 in April, the price has fallen all the way to $77.27, as of today. Natural gas, which was $4.27 last month, has fallen 15 percent since then to $3.62. Surely with all of this uncertainty, the Corbett’s proposed impact fee makes more sense than the traditional severance tax which most states use? Perhaps it would be better to take the predictable lump-sum amount than basing that portion of the state’s coffers on the vagaries of the market?

No, not really.

Corbett’s plan allows the counties to charge up to $40,000 per well per year, for a period of up to 10 years per well. According to the Post-Gazette, his administrations figures it could bring in $120 million in the first year, and up to $200 million per year by the sixth year.

Or, as I pointed out in June, we could tax like Texas. Texas imposes a 7.5% severance tax on natural gas and 4.6% tax on oil and condensate. Using yearlong production data for non Marcellus Shale wells in Pennsylvania and the average wellhead price of gas and price per barrel of liquid hydrocarbons for 2010, I estimated that non-Marcellus wells would have brought in $72.5 million if we taxed our resources just like Texas does. What’s more, based on six month production data, I showed that the wells in the Marcellus Shale formation would produce at least $173 million, for a statewide total of $246 million through all formations.

But that was before the bottom fell out of the price of oil and gas. What if we used today’s low prices as a guide?


Estimated six month severance tax from the Marcellus Shale formation in Pennsylvania.

Even with the low energy prices, that six month total is almost as much as Corbett’s administration figures to raise in a year, and it doesn’t even include the tens of thousands of wells that aren’t drilled into the Marcellus Shale.

While the proposed impact fee does more for Pennsylvania than the current nothing-at-all policy, in the scheme of things, it is a great deal for the drilling industry.

And one final aside: does it seem strange to anyone else to let the counties set the impact fee? Is this some sort of attempt to have them compete with each other to keep the prices low? If so, it seems unlikely to work in my opinion. If a county charges the maximum $40,000, that represents only about 0.8 percent of cost of a well that costs $5 million to drill, and that figure is on the low end of the spectrum. The drilling companies will want to drill where the resources are, and whatever fees or taxes are charged will not change that fact.

What if Pennsylvania Had the Same Severance Tax as Texas?

Archived

This page has been archived. It is provided for historical reference only.

The prolific oil and gas producing state of Texas imposes a 7.5 percent severance tax on natural gas produced within the state, and 4.6 percent levies on both oil and condensate. In a recent post, I mentioned that if Pennsylvania had the same severance tax as Texas, the Commonwealth would have raised about $72.5 million last year–just from non Marcellus Shale oil and gas wells.


Estimated market value and hypothetical severance tax of non Marcellus Shale well production in 2010.

In the table above, the market values were determined by multiplying the total production with the average price for the wellhead price of gas and petroleum and other liquids, respectively.

That may not be enough to plug the gaping hole in Pennsylvania’s budget, but it would at least be enough to fill a few potholes. But what if we took Marcellus Shale production into consideration as well?

Unlike wells from other formations where the production report coincides with the calendar year, Marcellus Shale production is available for the period from July 2009 through June 2010, and from July to December 2010. While there were certainly more Marcellus wells toward the end of the year than the beginning, this is more than made up for by the likelihood that the self-reported Marcellus production data is dramatically understated. I say this because there are only 1,255 wells reporting any production in the last half of the year, and yet there were 2,498 Marcellus wells by year’s end. So while I will multiply the six month totals by two to represent the whole year, multiplying by four might be more accurate still.


Estimated market value and hypothetical severance tax of Marcellus Shale well production in 2010.

Taking the self reported data at face value, we are now looking at a hypothetical severance tax of $246 million for all formations. While that won’t solve the budget problems either, it would be enough to preserve the jobs of thousands of teachers throughout the Commonwealth.

Former Governor Rendell did little to promote a severance tax in his tenure until the very end, and Governor Corbett has stated his opposition repeatedly. However, in the interest of paying our bills without jeopardizing our fragile economic recovery, the idea of the severance tax is clearly worth another look.

It can’t be that bad for the industry.  After all, they’re still drilling wells in Texas.