How New York State Exaggerated Potential Job Creation from Shale ...

Additional failures of New York’s
analysis of socioeconomic impacts
The “average” development scenario would rapidly
expand drilling and fracking
The “average” scenario assumed that 165 new wells
would be drilled and fracked in the first year of development,
increasing gradually to 1,652 new wells
in the tenth year of development (see Table 1), after
which point the annual number of new wells would
stay at 1,652. For comparison, in Pennsylvania in
2010 there were 1,405 new wells developed, and 2,459
new wells have been projected for development in year
2015. 38 New York’s rapid pace of shale gas development
would be concentrated in certain counties, 39 and
it is far from certain that such development could be
sustained for 30 years.
The New York analysis assumes that 50 percent of
the wells would be located in just three counties:
Broome, Chemung and Tioga. 40 Under the “average”
development scenario, the number of new wells would
increase gradually until reaching 826 new wells per
year in years 10 through 30 in these three counties. 41
In total, 21,067 wells would be developed in these
three counties. 42
With such extensive shale gas development, significant
negative impacts on other parts of the economy,
such as agriculture and tourism, would likely result,
but the New York analysis fails to account for such
negative impacts.
Negative impacts on employment in agriculture and
tourism from shale gas development are dismissed
with a spurious argument
Although the New York analysis acknowledges that
shale gas development could have negative impacts on
employment in other industries, these potential negative
impacts are not included in the job projections. 43
Instead, the New York analysis dismisses the significance
of such negative impacts with the simple argument
that “Cattaraugus and Chautauqua Counties
still have healthy tourism sectors despite having more
than 3,900 active natural gas wells in the region.” 44
But the fact that tourism and agriculture exist as industries
in Chautauqua and Cattaraugus counties is
not a serious argument. It is quite possible that tourism
would have been greater in these counties were
it not for the past and current gas drilling. Moreover,
modern shale gas development is far more intensive
than conventional natural gas development: much longer
boreholes drilled, much more fracking fluid used,
much more wastewater created and much more heavyduty
truck traffic. 45
The cumulative impacts that such development would
have on other parts of rural economies may be difficult
to quantify, but they must not be dismissed.
Thirty years of shale gas production per well is optimistic,
meaning production jobs are likely overstated
In projecting production phase jobs, the New York
analysis assumed that each new well produces shale
gas for 30 years, and further assumed that the estimate
of 0.17 FTE production phase workers per well
would hold for all 30 years. 46 But this estimate, taken
from the 2009 MSETC report, is based on only a few
years of shale gas production in Pennsylvania. 47 This
introduces significant uncertainty into New York’s
production phase job projection. New York assumes
that production of a typical horizontal well will fall by
75 percent from year 1 to year 4, and by 90 percent
by year 15. 48 But if production falls more rapidly than
expected, then there would be fewer production phase
jobs over the long term. Indeed, the U.S. Securities
and Exchange Commission is investigating whether
shale gas companies have overstated the productivity
of shale gas wells. 49
Rapidly changing estimates of the amount of recoverable
shale gas also raise questions about future well
productivity, 50 suggesting that the amount of gas that
can be recovered from a given location of the shale
may vary significantly from well to well.
8 Food & Water Watch • www.foodandwaterwatch.org