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Despite abundant supply, natural gas slow to catch on as transportation fuel

A customer fills up at a public CNG station in Towanda. There are only about 22 public stations like this one in Pennsylvania

Marie Cusick/ StateImpact Pennsylvania

A customer fills up at a public CNG station in Towanda. There are only about 22 public stations like this one in Pennsylvania.

The most recent Marcellus shale production numbers were record-breaking.  If Pennsylvania keeps up this pace, it will be producing enough gas to supply more than 10 percent of what the entire country uses in a year.

And with this glut, there are efforts to find new markets for the gas— especially in transportation.

Compressed natural gas (CNG) can be used as an alternative fuel to power cars and trucks, but it isn’t catching on everywhere.

“Way too much supply”

In Pennsylvania, we have more natural gas than we know what to do with. Alan Walker, who heads the state’s Department of Community and Economic Development, puts it this way:

“It’s an industry that responds to supply and demand. Right now we have way too much supply,” he says. “It’ll balance out, because people aren’t going to drill wells if they can’t make money at it. There was this rush—like the gold rush—and we are producing a lot more than we can absorb.”

Unlike the rush to get the gas out of the ground, there hasn’t been a rush to convert vehicles to natural gas.

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Q&A: Oil Spill Expert Puts Crude-By-Rail Boom In Perspective

A train pulling a row of tank cars moves along the tracks near a Hess transfer facility near Tioga, North Dakota, U.S., on Thursday, July 11, 2013. There is a continued boom situation in the area due to the ability to extract oil from the Bakken Formation.

Matthew Staver /Landov

A train pulling a row of tank cars moves along the tracks near a Hess transfer facility near Tioga, North Dakota, U.S., on Thursday, July 11, 2013. There is a continued boom situation in the area due to the ability to extract oil from the Bakken Formation.

Philadelphia is at the center of a new industrial boom: trains are snaking through the city, bringing light, sweet crude oil from North Dakota to the city’s revived refineries. They’re the same type of train that derailed and exploded in the Canadian town of Lac-Megantic in July, leaving 47 people dead.

StateImpact has reported that the deadly accident hasn’t put the brakes on oil trains coming into Philadelphia. In fact, there are more coming than ever.

So, what exactly is this stuff and what are some of the risks involved?

StateImpact talked to oil spill expert Nancy Kinner, Director of the Coastal Response Research Center at the University of New Hampshire, who put this new boom in perspective.

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Oil Trains Rumble Into Philly, Bringing Dakota Crude, Jobs And Safety Concerns

CSX K040 Robert King

Courtesy of Robert King

Correction: An earlier version of this story reported that Philadelphia Energy Solutions would be accepting trains carrying 70,000 gallons of crude oil each. The correct volume is 70,000 barrels.

Robert King remembers the very first time he saw an oil train.

“It was April 14, 2013.”

King, a 17-year-old Philadelphian, is a “railfan,” the name for members of a worldwide community of passionate, or some might say obsessive, train buffs.

On that day, King and railfans from the Midwest to the East Coast were busily tracking the inaugural run of a brand new train: the CSX K040, an oil train more than one-mile long hauling raw crude from the Bakken Shale in North Dakota bound for South Philadelphia.

With his camera bag slung over his shoulder, King pedaled his blue-and-white mountain bike to Schuylkill River Park in Center City and up the ramp to a foot bridge overlooking the CSX tracks. Then he settled in to wait. As he stood there, he recalls, “There’s some worry on my mind.”

King fretted that another train slated to use the tracks at the same time might ruin his dream photo. But he got lucky that day, snapping the photo of Philly’s first oil train that you can see on this page.

Nowadays, railfans like King have frequent chances to catch this view.

That’s because Philadelphia is at the center of a new industrial boom. Oil trains are becoming a common sight on tracks between North Dakota and Philadelphia. To get here, they travel through some densely populated areas – Chicago, Albany and New Jersey – which is raising some safety concerns.

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Pennsylvania’s Climate Change Future: Read The Missing Report

A 2009 state report found Pennsylvania contributes one percent of the world's greenhouse gases.

Frank Rumpenhorst DPA /LANDOV

A 2009 state report found Pennsylvania contributes one percent of the world's greenhouse gases.

A pair of legally-mandated reports outlining how climate change will affect Pennsylvania are currently a year overdue.

The state’s Climate Change Act required the publication of both reports in 2009, followed by an update every three years.

Both documents were due last year, but they’re still under review, and the state Department of Environmental Protection won’t say when they will be released.

StateImpact Pennsylvania has obtained one of the original draft reports. It was written by a team of scientists from Penn State University and submitted to the DEP in early 2012.

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Marcellus Shale Exports Could Transform Global LNG Market

The offshore loading pier at Dominion has not received a ship importing liquefied natural gas since January 2011.

Lindsay Lazarski / WHYY/Newsworks

The offshore loading pier at Dominion has not received a ship importing liquefied natural gas since January 2011.

In energy-hungry countries, all eyes are on Pennsylvania’s Marcellus Shale gas. In a dramatic shift from just five years ago, the U.S. is looking to export, instead of import natural gas. And if more natural gas starts getting shipped abroad, Pennsylvania’s Marcellus Shale could help change the global market for natural gas, and lighting homes in Tokyo.

The U.S. currently has two export terminals, one in Sabine Pass, Louisiana, and the ConocoPhillips LNG export terminal in North Cook Inlet, Alaska. The U.S. Department of Energy just gave preliminary approval for ConocoPhillips to expand its Freeport, Texas import terminal to export liquefied natural gas. About 17 other export proposals now await approval by the DOE, including the Cove Point liquefied natural gas import terminal operated by Dominion Resources.

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Corbett Administration Ignoring Pennsylvania’s Climate Change Law

The Corbett Administration has failed to produce a pair of legally required reports about climate change, and the governor is reluctant to publicly discuss the topic.

Michael Bryant/Inquirer/Landov

The Corbett Administration has failed to produce a pair of legally required reports about climate change, and the governor is reluctant to publicly discuss the topic.

Despite widespread scientific agreement about the risks of climate change, the issue has become highly politicized.

After President Obama recently announced his plans to tackle global warming, Governor Corbett called the proposal a war on coal and jobs.

While the Corbett administration is critical of federal action on the issue, it’s also been ignoring a Pennsylvania law requiring the state to address climate change.

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Senate Panel Examines Complaints Of Underpaid Gas Royalties

National Association of Royalty Owners (NARO) President Doug Sikes testifying before a Senate committee on gas royalty payments.

Marie Cusick/StateImpact Pennsylvania

National Association of Royalty Owners (NARO) President David Sikes testifying before a senate committee on gas royalty payments.

A Senate hearing today about gas royalty payments began with a mention of mushrooms.

Joel Rotz is the senior director of state government affairs for the Pennsylvania Farm Bureau. He pointed out the state’s prominence as a top mushroom producer.

“Why do I bring that up?” he asked rhetorically, “Most of you know how you grow mushrooms. Keep them in the dark. Feed them a little manure, and they grow. We’ve got landowners out there right now who are feeling a little like mushrooms.”

As StateImpact Pennsylvania recently reported, some landowners in the state’s most drilled on place — Bradford County — are alleging they’re being cheated out of royalty payments by one of the biggest gas companies in the nation.

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Q&A: Industry Economist Makes the Case for Exports

Liquefied natural gas (LNG) storage tanks and a membrane-type tanker are seen at Tokyo Electric Power Co.'s Futtsu Thermal Power Station in Futtsu, east of Tokyo February 20, 2013. Japan's imports of LNG hit a monthly record of 8.23 million tonnes in January, on an increased need for fuel to generate electricity after the nuclear sector was hit by the Fukushima crisis.

Issei Kato / Reuters/Landov

Liquefied natural gas (LNG) storage tanks and a membrane-type tanker are seen at Tokyo Electric Power Co.'s Futtsu Thermal Power Station in Futtsu, east of Tokyo February 20, 2013. Japan's imports of LNG hit a monthly record of 8.23 million tonnes in January, on an increased need for fuel to generate electricity after the nuclear sector was hit by the Fukushima crisis.

The nation’s new energy secretary Ernest Moniz spoke at an energy conference Monday, where he told the audience that applications for new natural gas export facilities would be decided upon by the end of the year. Gas producers want to sell their fuel overseas where it fetches a higher price. But before it gets shipped abroad, it has to be converted to its liquid form known as LNG – or liquefied natural gas. Building those facilities is expensive. The closest proposed LNG export terminal to the Marcellus Shale deposit is in Cove Point, Maryland. That could cost more than $3 billion dollars to convert from its former role as a natural gas import terminal. But domestic manufacturers and those who say U.S. security depends on keeping the fossil fuel stateside are pushing back. Environmentalists worry that exports will stimulate more production in states like Pennsylvania, where activists have been pushing to implement a drilling moratorium. StateImpact spoke to the chief economist of the American Petroleum Institute, John Felmy, about the future uses of natural gas, and the export issues.

Q: Phillips: John, one of the things that keeps popping up in the news is this issue of exporting natural gas, liquefied natural gas. What was the role and what is the role of Marcellus Shale production regarding the future of LNG Exports?

A: Felmy: Well, Marcellus Shale could play a tremendous opportunity in terms of exports, because it’s such a vast deposit. Developing it can of course be used to supply other states, as we are doing now. But there is likely to be so much of it, that exporting it at a very good price would help in terms of keeping production going.

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DEP’s Fracking Record-Keeping Blocks Transparency

Susan Phillips / StateImpact Pennsylvania

Empty water jugs used to haul clean water hang from a house in Washington County. Residents suspected nearby gas drilling as the culprit for their wells going bad. The DEP investigation concluded drilling was not to blame.

Here’s a key question amid Pennsylvania’s natural gas drilling boom: How is drilling affecting residential water wells? Researchers say data on that core question is spotty. But one Pennsylvania agency could hold the key to answering questions from both residents and scientists. The problem is, the state Department of Environmental Protection says it organizes its records only to “support our operations,” according to agency spokesman Kevin Sunday.

So a simple request that could shine light on at least how many cases of water contamination the DEP determined were due to gas drilling operations, turned into a protracted legal battle. In an open records case settled last year between DEP and the Scranton Times-Tribune, the Commonwealth Court criticized the DEP for poor record-keeping.

But the DEP remains unapologetic about their unsuccessful argument to the court that providing copies of their water investigation determination letters would be “burdensome.”

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Lovers of Pa.’s Loyalsock Forest Fight to Limit Drilling There

Lindsay Lazarski / WHYY/Newsworks

"We have to be the voice of the birds," said Paul Zeph, of the Pennsylvania Audubon Society.

Deep in the Loyalsock State Forest, where no cell phone signal reaches, the sounds of rushing waterfalls and forest birds are suddenly interrupted by the sound of a helicopter.

Paul Zeph of the Pennsylvania Audubon Society says the noise could be related to gas drilling. Drillers will often drop seismic testing equipment into remote areas that are difficult to reach by roads. And that leads Zeph to cite one of the many worries that naturalists and outdoors lovers have with plans to expand drilling in the Loyalsock.

“Song birds identify one another through singing and they identify their territory through singing,” says Zeph. “With a very noisy environment, studies are starting to show that it’s impairing the ability to find mates.”

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