By MICHAEL HILL, AP

link to original article here:
http://www.nypost.com/seven/11172008/news/regionalnews/city_fears_gas_h2_woe_139130.htm

TOMPKINS, NY - A massive natural-gas reserve that lies under this rural region is a potential cash cow for strapped farmers in the area - and a guaranteed disaster for New York City's drinking supply, opponents say. Dozens of landowners in the region 120 miles northwest of city and in the heart of the Catskills have already signed lease deals with energy companies that could open their land to drilling. But there's one major hitch: Given that the Big Apple draws most of its water from in and around the Catskills, city officials are worried about the expected natural-gas boom edging into their watershed. "This is a particularly extreme example of something that absolutely, positively cannot take place within the confines of the watershed," said City Councilman James Gennaro (D-Queens), chairman of the Environmental Protection Committee. Gary Galley, a local farmer who has already signed on with an energy firm, sees things differently. "Go ahead and drill!" Galley said with a laugh as his cows grazed. Galley talked about scratching out a living on his farm west of the Catskills as he fed his cattle. He also talked about the big money that could come from the gas reserve thousands of feet below his farm. This part of Delaware County sits on the edge of a multistate natural-gas reserve called the Marcellus shale formation. Marcellus is a deep formation covering parts of West Virginia, Ohio, Pennsylvania and all of New York's Southern Tier. It has been estimated that the entire formation holds enough natural gas to satisfy the nation's demand for 14 years. Drillers largely ignored Marcellus for many years because it was too deep and too expensive to tap. That changed as energy prices skyrocketed and geologists refined a horizontal drilling process to tap deep reserves. The process, called "hydrofracking," requires millions of gallons of water, a portion of which comes back up and is stored temporarily on site before being treated. Paul Rush, a deputy commissioner with the city's Department of Environmental Protection, told lawmakers in Albany at a recent hearing that hazardous compounds used in hydrofracking could pose a "grave threat" to New York City's water. Mayor Bloomberg's administration has not followed Gennaro's lead in calling for a one-year drilling moratorium. But the city's Department of Environmental Protection has sought a role in developing permit conditions in the watershed and suggested a one-mile no-drill zone around reservoirs and other watershed infrastructure. Meanwhile, many watershed residents don't like the idea of New York City hanging a "no drilling" sign on their land. "If they do it for the city watershed, they'd better do it for all watersheds," said Town of Walton Supervisor John W. Meredith. "And guess what? That's the whole state."Gov. Paterson's administration is now updating state drilling regulations to make sure protections are in place for horizontal drilling and hydrofracking.