Sean O’leary had an article on December 24th in the Martinsburg Journal News entitled “Will our natural gas boom help us?” This is a timely question, and we wish there were a good answer. Let’s see what Sean O’leary had to say:
With the recent enactment of rules regulating the extraction of natural gas from Marcellus shale, a process known as “fracking,” some believe West Virginia will experience an economic boom. Newspapers have called our Marcellus shale deposits “a godsend” and Bill Maloney, the recent Republican candidate for governor, described them as “the biggest opportunity for lasting growth and prosperity that West Virginia has seen in decades.”
But, what if it’s not true? Set aside for a moment the real and legitimate environmental concerns surrounding fracking. What if the gas-drilling boom isn’t an economic game-changer for West Virginia?First, most of the wealth generated by gas won’t go to West Virginians. As with coal, almost all of West Virginia’s gas will be extracted by out-of-state companies that will repatriate the profits elsewhere. Second, the royalties West Virginia residents will receive won’t be overwhelming.
Finally, gas drilling’s contribution to the state budget through severance taxes will be offset in large measure by added costs for inspectors and the maintenance of roads and infrastructure necessary to the industry. In fact, if gas turns out to be like coal, the costs may equal or exceed the tax revenue.
The most likely outcome of West Virginia’s natural gas boom will be the enrichment of a small number of property owners and industry workers, a burst of revenue and expenditures for the state, but, little change from the depressed status quo for most West Virginians.
There is more information in the original article from the Martinsburg Journal News.
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