Smaller-Scale Marcellus Drillers Worried They'll Be Priced Out By Impact Fee

A handful of Pennsylvania energy companies drill for natural gas in the Marcellus Shale vertically, not horizontally. This means their production totals – and profits – are much lower than the larger-scale operations most people associate with shale drilling.
As the Tribune-Review reports, these companies are worried they’ll be priced out by a $40,000 or $50,000-a-well impact fee:

…Because the fee is the same for every well and not tied to production, small drillers who don’t produce as much gas say they would end up paying a higher percentage of their revenues. Their rate could be the equivalent of 9 percent.
Two small, closely connected drilling companies in Armstrong County have been lobbying state officials — with some success — to lower the proposed shale-drilling impact fees for a few small companies such as theirs. MDS Energy Development LLC and Snyder Brothers Inc., both of Kittanning, aren’t doing the large-scale work that state officials are trying to target and shouldn’t have to pay the same fee, said Michael Snyder, MDS founder and son of the Snyder Brothers’ president.
“Our reaction was that this is crazy,” said Snyder, 27, of Kittanning.

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