Revenue (Impact Fees) from Shale drilling drops in local communities

Many municipalities across Pennsylvania received less money from the fees paid for Marcellus drilling this year. The average lesser amount was about 10%.  The fees collected for 2012 was about $202.4 million dollars, which was a decrease of about $1.8 million dollars. Part of the reason in the drop in impact fees is the drop in the cost of natural gas. The drop in revenue can also be affected by the fact that any new wells are charged higher fees in their first year of operation.

Under Act 13, which also limits efforts to regulate drilling by county and local governments, impact fees for drilling operations are divided between counties, state regulatory agencies, and communities that host Marcellus Shale development. A sliding scale was incorporated into the bill so as not to create a “disincentive” for drillers to start new wells, when the price of gas is low.

Some of the biggest contributors to the impact fees are Chesapeake Appalachia LLC  and Range Resources Appalachia, LLC, respectively.

One of the struggles with the natural gas industry is that supply sometimes outweighs the demand and that is what keeps the price of gas down. But, with any commodity, there will be an eventual increase in the price of gas which will increase the amount of wells being drilled and increase impact fee revenues.