March 31, 2011 "Community Forum"

Ben Tettlebaum: Welcome everyone. Welcome to the community forum, the Cornell Environmental Law Society and Water and Land Use Clinic 2011 Energy conference, gas drilling, sustainability, energy policy searching for common ground. I'm Ben, the conference chair. Thank you all for braving for what is not yet a Northern Eastern, but we seem to be on the fringes of it. You are the hardy souls that could come and we really appreciate that. Appropriately enough it was a community member who suggested we hold this community forum. Our intention with this is to provide information about what I think we all agree is a very important issue and to generate a discussion tonight about shale gas development. It's an important issue clearly for the community and by community I mean for Cornell, for Ithaca, Tompkins county, New York State and indeed the country. We have worked hard to assemble for tonight’s panel, but also for the entirety of the conference, which we hope you all can join us for, for the entirety of the conference and for this panel a diverse group of experts and particularly for this one a diverse group of experts from _____(meriad :*40:12) professional backgrounds working locally and regionally in New York State. We are going to try to cut right to the heart of the issues certainly tonight, but throughout all of our panels and our keynotes at this conference. So that said let me just tell you about the structure for the evenings activities and then we'll get underway. We're going to start with three presentations by Cornell Land Use clinic students and after those presentations, we will go directly into our panel. We have eight panelists here who are giving their valuable time for this forum and one fine moderator who's going to guide our discussion for the evening. She'll probably repeat this, but I'll tell you just so everyone is clear. Our panelists will give brief introductory remarks. Our moderator will give a few guided questions and the balance of the time is meant for all of you to ask questions. That's the point of this forum tonight. That said know this is a heated issue and we ask that you respect each other, respect the conference organizers who are volunteering their valuable time for the event and of course, please respect the speakers and our moderators as well as they are giving graciously of their time to come here to talk with you all this evening. So without further ado I'm going to introduce our first clinical student presenter and that is Colleen Lamarre. Please join me in welcoming her tonight.

Colleen Lamarre: My involvement in the clinic, during my involvement in the clinic I have looked specifically at landowner's right when there is a possible _____*42:43 trespass. So I specifically addressed the issue of whether trespass law provide landowners who subsurface a state as encroached upon through hydraulic fracturing legal protection. As you all know, the hydraulic fracturing process is used to release oil and gas from tight shale formations and other sedimentary rocks. A basic comprehension of this process is necessary to understand just where and when possible trespass occurs. Although seemingly simple hydraulic fracturing involves several steps. Prior to the actual fracturing process a well is drilled vertically and once the well reaches the depth of the shale the well is then drilled horizontally. Hydraulic fracturing is then accomplished by pumping fluid which is under pressure down the well to fracture the reservoir rock. This releases oil and gas from the shale and creates channels for the oil and gas to flow through the reservoir into the well. Hydraulic fracturing makes gas production in areas that were previously inaccessible, non-profitable but accessible and extremely profitable. One of these such formations is of course Marcellus Shale. I now turn to the elements of subsurface trespass. Hydraulic fracturing in the process I just described may infringe upon the property rights of a neighboring non-consenting land owners. Non-consenting landowners therefore may seek legal recourse by making a trespass complaint. In general trespass occurs when there is an intentional and unprivileged invasion of another person’s real property. Here as the diagram demonstrates trespass may occur in two situations. First it may occur when the drill bit turns horizontally and crosses property lines. Second trespass may occur when the fracking fluid is injected at a high pressure to fracture the shell and this fluid crosses the boundary lines. If the fractures surpasses the landowners property lines and encroaches on the neighboring plot this invasion may constitute trespass. Because modern surveying and fracturing technology allowed gas and oil drillers to measure and predict the volume, length and direction of the fracture courts may find a resulting subsurface trespass occurred by either intentionally or negligently. No proof of harm is necessary to recover on a trespass plain, although attempt and negligence bear on the extent of the damage which is recoverable. New

York law should reflect these advances in technology. This technological process will be discussed later on in different panels so I wont discuss that further. In looking at the trespass analysis, New York courts have not yet determined an appropriate legal doc print for analyzing landowner's subsurface trespass claims. Common law developed in other jurisdiction historically applied oil and gas law doctrines and legal treatments of analytically similar processes provide useful guidance. There are three basic legal doctrines that are applied to oil and gas law. The first, the rule of capture, is a common law rule that holds the first person to reduce subsurface oil or gas to visible possession becomes the owner of the oil and gas regardless of whether the product was in fact extracted from beneath that person’s subsurface property. Here we'll capture assumes that oil and gas migrate within reservoirs and between property lines. In application, the rule of capture limits landowners liability for draining reservoirs spanning across property lines and nearby promoting public policies which encourage oil and gas drilling. According to the rule of the capture and non-consenting landowners remedy against drainage from a common oil or gas pool is one of the _____*47:04. Simply said that means that these landowners can go and do likewise, drill in other words. The correlative right's doctrine is kind of the next doctrine that has developed oil and gas law and under that doctrine the rule of capture is basically modified. This doctrine is a statutorily and imposed legal doctrine which limits the rights of landowners to a common source reservoir to their reasonable share. Typically this share is based on the amount of surface property that landowner owns. Next is the ownership and place doctrine. Under the ownership and place doctrine, the ownership of gas and oil in place and in a particular land rests in the landowner. According to this doctrine, prior to an extraction, ownership of oil and gas cannot be the subject of ownership distinct from the parcel itself. The ownership of the gas is connected with the ownership of the physical land. This doctrine is applied to _____*48:12 solid mineral resources. In examining hydraulic fracturing, these three doctrines may be applied to the following three analytically similar processes. First slant drilling, next secondary recovery and storage operations and third the extension of coalmine seams. Slant drilling occurs when a well is drilled on the surface of one landowner's property and intentionally or inadvertently deviates from a vertical line and bottoms on an adjoining track. The Texas Supreme Court has likened hydraulic fracturing to slant drilling in several cases. Well in one case the court did conclude that an unprivileged invasion occurred, the court noted that public policy in favor of gas production demanded them the actual trespass not be found. In another such case the court found that there was indeed an actual trespass; however, the court later ____*49:14 this opinion which makes it a lot less significant to the legal world. Next, secondary recovery and storage operations require that fluid is pumped into wells. In this process it is possible for injected fluids or gas to flow from the injection well into an adjoining pot. Various state courts held that this process may constitute a trespass. These states are primarily states like Arkansas and Nebraska and they had been very reluctant to award damages. They often use the rule of capture or relative rights doctrine to justify the policy oriented outcome they reach. Finally, historically the extension of coalmine seams was used to gain access to subsurface estates of adjoining properties. This doctrine is perhaps the most relevant and perhaps the most novel; however, it may apply to best to this area since coalmining is historically very significant to this region. This process has been consistently deemed trespass when there is an extension of coalmine seam that goes onto another plot of land. Well the courts have not compared this process to that of hydraulic fracturing. The purpose and in fact of the two processes are very similar. Extending the seam of coalmine allows acces to coal, similarly hydraulic fracturing grants access to previously trapped gas. In some ways prior to frack job the gas was trapped and almost non-fugacious and as such this gas was separate from a common reservoir where the drill bit or fracture created by the frack fluid crosses property lines it is a trespass itself that makes the gas fugacious and creates the common pool. The unique attributes of shale make the trapped gas more like solid mineral. Coal and other solid minerals are generally governed by the ownership place doctrine and therefore this doctrine should be considered in the hydraulic fracturing process. If this doctrine is employed to possible trespass actions studying from hydraulic fracturing, absent, undo influence of pro recovery public policy courts should find a trespass did indeed occur. Finally, Texas and other prolific oil and gas producing states have suggested and have done that while hydraulic fracturing crossed property lines it does not present compensable trespass claim. New York and the laws of other Marcellus Shale region of states remain undeveloped. There are three reasons that New York courts and legislature should not follow Texas and rather that they should determine that when crossing property lines hydraulic fracturing does indeed constitute subsequent trespass. First, Texas law reflects old outdated technology which is not used in the Marcellus Shale region. Second, hydraulic fracturing presents a

prolifera of environmental concerns that are unique to this region. The known and unknown risks are far to great to allow fracturing at this specific time and finally, New York should adopt laws which reflect the proper application of well-developed legal doctrines rather than adapt these legal doctrines to provide a popular outcome. Thank you. Next will be Michelle Mitchell who is also in the clinic.

Michelle Mitchell: Good evening everyone. My name is Michelle and I, as part of the Land Use Clinic had done a project on helping local municipalities with how they deal with conserving and protecting their roads from heavy truck traffic associated with natural gas drilling especially by hydraulic fracturing. So here on the screen you can see a before and after photograph of a road in Bradford county and although this is an extreme example, you can really see how the overweight, high-volume truck traffic has really cause havoc on this road. Natural gas drilling is currently occurring in the Northern Tier of Pennsylvania. So some truck traffic statistics. A typical relevant part is probably from six million gallons of water during the fracking periods. This is going to take over one-thousand truck trips per well site to get this water to the wells. The trucks are over 80,000 pounds and so the impact is equivalent of nearly 3.5 million car trips. Really the huge estimated risk is for town roads. They have a 90% estimated risk just because of strength of the road is not nearly as high as the state roads and the county roads so they are at the highest risk for road failure. Here again is another photographs, again it is an extreme example of the way another road has been damaged in Bradford county and over 1,300 miles of roads in the county 1,100 of them have had damage to some extent, sometimes very minor. A huge problem is enforcement concerns. So the Pennsylvania state police in two separate weekends in June and September had a checkpoint and stopped 2,300 trucks and more than 1,600 of these were cited for safety violations or were over the weight limit. The monetary cost for PA, they've spent $10,000 on weight limit signs alone and in Arkansas over $200 million damage has been done to Arkansas state highways. Additionally, upwards of $100,000 per mile would be needed to buy a reconstruction of a lightly traffic road that had some residual strength, but to dig up a road completely would cost nearly twice as much. So really the monetary costs are huge here. And then there is environmental concerns. So here is a photograph on the right of a spill onto Pine Creek last March in Waterville, PA and water and hydraulic gas are leaking. The storm water runoff is also an additional environmental concern so the disturbance of soil and rock as a result of road damage creates erosion and sedimentation. This will be to include what is being conveyed to streams during runoff during some rainstorms and snow runoffs. So the legal landscape, local governments do have the authority to establish rules and regulations for how they are going to protect their local roads as part of the environmental conservation law as you see here on the left. However there are a few ______*56:05. The first is that you cannot in active role gain any law or regulation, you cannot target the ______*56:14. You can’t _____*56:17 a law that says gasoline trucks aren’t allow on these roads, but cement trucks or dairy trucks or agriculture trucks are. The law has to be uniform across the board. Secondly, you cannot impose any sort of impact fees on the gas drilling operators for the use of the road and lastly any sort of regulations that are reasonable. So I can recall a government student before, first thing and presuming protecting the roads has inspired a traffic engineering firm to really conduct a thorough structural functional study on the condition of the road prior to the drilling so they know which roads are most vulnerable. Then once the drilling progresses posting road limits and really enforcing load zoning as key, as well as monitoring road conditions and _____*57:06 Finally, sharing information across municipals lines among both towns and between towns and counties on what is being negotiated between the towns and the gas drilling operators is really essential. So there are really three options for local government when they are trying to deal with protecting their roads. The first is a road use and maintenance agreement and what this is, is an agreement between the town and gas drilling operator, a voluntary agreement where the operator will generally will agree to maintain and restore the roads to a level that is consisting with the conditions of the road prior to the drilling activity. An operator is not in anyway legally bound to enter into such an agreement, although many operators do see a cost in doing business. Another option is a commercial law requirement. This is where an operator would post a bond for any future road damage attributable to them. The bottom requirement resuscitates that a towns fund an engineer study of the roads in advance so they know what amount the gas drilling operators need to follow for and finally the third option is a local law ordinance. These are laws that regulate overweight vehicles and high frequency and high impact truck traffic. The goals for the law is normally to keep heavy truck traffic off the most vulnerable roads; however, again we must keep in mind that you cannot single out any of the gas drilling trucks and the gas

drilling operators when _____*58:30 these local laws. So here are just some pros and cons of running a ______*58:37 (s/l aluma) versus a law. The pros are really for a ____(s/l aluma) is it's a private contract. So it's not going to be set in any sort of introduction from the course of the legislators and also it is a lot more cost effective for towns. There's also a need for engineering studies, legal fees aren’t as high, less need for monetary cost for road, listings, etc. The cons again really lie in the voluntary cooperation which mean the gas drilling operators and the town, because again the gas drilling industry is not legally bound to do this. Road use regulations, the pros are that everyone is regulated by enforcing the law. So there is forceable law behind any sort of regulation of the town is going to complicate. It's mandatory versus _____*59:24 (s/l locations) with no negotiations needed. The cons again are there are possible challenges from courts as discrimination is a serious concern. Also there is going to be increased regulatory burdens on local businesses, such as the local trucking businesses who are now also have to abide by these new trucking and traffic regulations. So finally a few recommendations, I think the concept of the road ordinance such as a local law is very important because you want to have a forceable law behind any sort of traffic regulation that you want to set in work; however, you know a compromise could be having an option in the local law for voluntary _____(s/l aluma) whereas the gas drilling operator if they comply and want to negotiate for ______(s/l aluma) that will take place of the regulation and for some reason if ____(s/l aluma) didn’t go through the local government would still have the road ordinance in place and then also just another thing the government can do is contact legislatures at numerous lobby groups for you know technical assistance for engineering studies, etc. and also request the attorney general to release a formal opinion on the skill of the municipalities ability to exercise authority over the natural gas drilling activity that is currently, it is a little bit murky and it is not completely clear and finally possibly requesting our state to produce a model road use agreement between the towns and the gas drilling industry giving towns guidance really with a goal of preventing any sort of drill litigation between local government and the gas drilling industry. And here is just another clip of a newspaper in the Northern Tier of Pennsylvania. Thank you very much and now I'm going to pass it over to Alexis Saba.

Alexis Saba: Thanks. My name is Alexis. I'm a third year student at the Law School and I was involved in the water law and land use clinics last semester of last year. This year I've been working with ______ and _____*1:01:45 on the Community Environmental Defense Council, but it's my work from my clinics last year that I'm going to be presenting on. In the fall of last year, I took a look at community and environmental impacts. Pennsylvania and ______*1:01:59 region of Texas to kind of get a sense of what New York State might kind of expect if gas drilling does occur here and with that a background started to look to what kind of legal landscape we had and then what are these potential impacts and found that the city environmental quality review act had a very big role to play. So I'll be talking briefly about the senior process and some of the deficiencies in our legal landscape that we have and then finishing with a discussion about why this reliance on _____*1:02:34 (s/l Secra) might not provide adequate environmental protection or adequate guidance to industry that we would both hope it might. So ______ environmental quality review act is really the process for considering the environmental factors, actions taken by the many levels of government. So in this case the State Department of Environmental Conservation is the lead agency because of issue the well drilling permits, which are the initial permits to drill. So DEC can use a generic environmental impact statement in this case which assess environmental impacts of actions that have common impacts. So instead of conducting environmental impact statement for each well they can use generic impact statement for all the wells and currently issuing those. Supplemental generic environmental impact statement to assess the impacts of high along horizontal hydraulic fracturing given the impacts the new impacts that that presents. So under GIS, an applicant would submit and allow for these variety of factors and if these actions conform to the state conditions then no further ______*1:03:53 compliance is necessary in general circumstances, again DEC is preparing that supplemental impact statement ____*1:04:03 has. So there are deficiencies in the legal landscaping at all levels of government. The federal statutes, pretty much all of them in our anti-statutes contain exemptions a variety of ways for the oil and gas industry. I know that some thought is being given to what endorsement power EPA has for example, but there are many exemptions still. It's unclear what little power municipalities have in _____*1:04:35 statewide. There has been a lot of good work happening on the local level. We have been very involved in that. Since encouraging that some creativity is happening with what municipalities can do with it, but it is still unclear legally what municipalities have. State laws are pretty scattered. Generally there have

been complaints that the laws guiding the industry and still aren’t comprehensive that DEC has thrashed supplemental generic environmental impact statements only addresses DEC’s authority and not many of the other agencies that will be regulating and in terms of common law claims, what claims people can bring out of the general laws there is a lot of problems with that as well in terms of proving causation and contamination dealing with many plain tips of claims that have developed over a long period of time. So it's all very difficult at all levels of government. So in light of potential ways significant community and environmental impacts, in addition to deficiencies in the legal landscape, we get a reliance on the state environmental quality review act. In the work that I did, I found that it provides inadequate environmental protection along three lines. First is in the supplemental generic environmental impact statement, development process itself. Second is the enforcement stage and third is in the citizen suits to challenge the _____(s/l Secra) process. So in the SGIS process it is guided by the environmental conservation law, the state level, which contains this declaration that it is in the public interest to develop our oil and gas resources pretty much to the full extent. There is concern that this declaration that trumps the protection of some of the other states resources and the environmental conservation law is what is driving the _____(s/l Secra) process in the state. There is also the reality of secrecy in the _____(s/l Secra) process, although it is a procedural law that is aimed at information sharing and aimed at citizens involvement and this well documented discussions of secrecy and half well documented secrecy, that it is not as open as a process as we would like to be and then at the enforcement stage there's certainly a huge concern. Now even if you have an SGIS that is very complete and very well considered that DEC won't be able to enforce everything that is in them which is a cornerstone of the process. The SGIS introduced 87 new tasks for DEC just in this area as the only state agency that has had, well this is maybe a little outdated, it has probably changed now. At the time that I was looking at this DEC was the only state agency that had made cuts in the _____ *1:07:54 enforcement and permit review areas. So it's very concerning that DEC might not be able to deal with all the new mandates it has and then certainly the third stage where you have people being able to sue to ensure that this process is done adequately, again you run into similar problems where it's hard to have the resources to sue, the time to sue, knowledge of the process to be able to conduct an adequate sue, lawsuit and the standard of review if you do get into court is very differential to the agency. So it's very hard to overcome the authority that the agency has. So in addition to that if potential environmental and community harms because of these deficiencies you also have inadequate guidance to industry which hurts everyone involved. So many of the drilling companies and contractors are unfamiliar with laws in the northeast or maybe our environment here, they are coming from the west and the south and you see certainly Pennsylvania struggling to deal with problems and regulate after the fact and this all demonstrates how strong and thorough SGIS coming out of New York can help the industry operate efficiently without having to second guess when is the state going to enforce, when is it not, what laws are really applicable and what aren’t. It helps to have that solid understanding of what's going on and without clear laws you have a lot of companies who fly by companies who aren’t going to operate very well and that is certainly a risk reputation of the industry as well. So in light of the potential for community and environmental impacts and an efficiency and the legal landscape it was the result of my research that is extremely important that the DEC’s SGIS be very complete and very thoughtful because there is a lot riding on it. Thank you.

Mary June King: Hi everyone. My name is Mary June King. I'm the moderator for this evening. I'm very accustomed to this mechanism that I am wearing so I will do my best not to blast you out or anything like that. I am going to ask the panel to take a seat at this point and we'll get started as soon as we can. As soon as folks are getting themselves situated I'll fill you in on some of the structure of tonight’s forum. First of all, I want to remind everyone because I just saw someone do it to please turn off your cell phone if you have them on or anything that will be a distraction for folks. We are getting to start the evening off tonight with I will as the question, actually a compound question and each member of the panel will have three minutes to answer the question and I apologize I've gotten ahead of myself. We're going to start tonight with the panelist spending three minutes each telling me a little bit about their position and who they are and why they are here and then I will follow up with the questions that on that compound question and then each of them will have a couple of minutes to answer that, three minutes or so to answer that and then we will open the floor to questions from you. The method of questioning from all of you is going to be that I get to recognize the order of questioners so I will do my very, very best to take a broad swath of the room as a classroom teacher for many of you so I think

that might be all I can handle from this group. At any rate, Jesse will come around with the microphone based on me sorting of pointing to folks to the best of my ability and you will have one minute to ask a very direct question and please just one minute to get your question out and please be specific if you can to who you would like this question to go and if there are two people we will entertain that and then if it gets the dialogue going I will sort of play that by ear with the third person on the panel would like to address the question as well. We will see how we are doing on time. Our hope is to get as many of your questions in and just get as much information out there as we possibly can from as well rounded and versatile group of folks with a variance of opinions. With that said I am going to start off right here with John Conrad and I will let the panels have three minutes. I am going to time you with my timer that I found on my cellphone today so give me one second.

John Conrad: I am John Conrad. I am a _____*1:13:06 geologist and an environmental consultant for Hudson Valley. My general position on hydraulic fracturing that natural gas can be produced safely and that I believe that we do not place a choice between natural gas production and protection of our water resources. I believe that we can do both. I have been thinking a lot about the ______*1:13:28 that seems to surround this issue and why our positions have become so hardened and polarized on this issue and I am thinking of one petition in particular that may explain it at least partly and I am thinking what I consider to be the unsubstantiated claim that hydraulic fracturing process itself releases harmful chemicals into our drinking water and aquifers. It is widely assumed and incorrectly in my view the fractures will somehow migrate from the Marcellus shale upward through a mile or more of bedrock into our shallow drinking water aquifers and this perception has placed an enormous focus on the chemical additives themselves and has led a lot of people to assume the hydraulic fracturing process will destroy our drinking water resources. This assumption that hydrofracking will harm our shallow water resources in my view is an unfortunate misperception. There is an extremely low probability of hydrofracking could cause chemicals to migrate upward to shallow drinking water aquifers and this widespread misconception has triggered what I considered to be some clumsy legislation here in New York and has created an environmental fear surrounding hydraulic fracturing. There are several widely accepted and well understood scientific principals that explain why upward migration of hydrofracking fluid would not, well is unlikely to happen and therefore the exposure to these chemical additives is unlikely to occur and some of these factors include the tendency for dense, saline fluids to stay where they are. Saline water tends stay where it's injected and does not migrate upward through bedrock. Also after each _____*1:15:19 when the pressure is relieved on the Marcellus Shale the well where itself becomes a pressure sink and the fluids and the gas tend to move toward the well or into the well board and up the case well and also even if fluids did want to move upward through bedrock it is very likely that they would be intercepted by a port, the veracity in overlying bedrock above the Marcellus Shale or its upward flow would be hindered by low permutability layers of bedrock. All of these are addressed in the drafts SGIS that were just mentioned and if there is interest we can talk more about some of those principals later tonight. So the takeaway from me is this, the argument that hydrofracking could cause fracking fluids to migrate upward in the shallow drinking water aquifers in my mind is an exaggerated one and has led to our lawmakers in our communities to react out of anger and fear instead of science and fact. I wonder if we can set aside at least this one issue that we might be able to reach some common ground on hydrofracking.

Mary June King: Thank you our next panelist is Sandra Steingraber.

Sandra Steingraber: Thank you. It's an honor to be here. The Marcellus Shale is an ancient graveyard. 500 million years ago upstate New York was a shale of ocean full of sea lilies and squid and when these creatures died they sank into the sediments in the seafloor and turned into bubbles of methane. To the east was a range of mountains which eroded into this ocean. The elements that they contained arsenic, lead, mercury and radioactive ______*1:17:02 (s/l stronzeun) also became part of the seafloor which then turned into shale. So a mile or more below our feet lies a petrified fizz of champagne bubbles trapped in rock that is ___(s/l suffused) with salty grime and a host of metals and radioactive isotopes. As long as we leave this bedrock intact it's not hurting anyone, although it sometime contributes radon into our basements. But if we use water and toxic chemicals to shudder it in order to bring these bubbles of gas to the surface we open Pandora’s box. Hydrofracking is an unsafe practice and it cannot be made safe. It's unsafe because each well requires 1,000

tankered truck trips with 96,000 well envisioned in New York our rural roads fill up with 18 wheelers hauling hazardous materials. These are the same roads in which soon enough I will be teaching my 12-year-old daughter to drive. Fracking is unsafe because it releases into the environment and inherently toxic chemicals. The diesel exhaust from trucks, compressors and condensers fill our air with soot, smog, ozone and ultrafine particles. These pollutants are linked to bladder, lung and breast cancer, stroke, diabetes and preterm birth. Exposure to diesel and vapors like in carcinogen benzine and neurotoxic ____*1:18:14 added to our medical cost and the need for special educational services in our schools. Fracking is unsafe because it turns millions of gallons of fresh water to poisonous flow back fluid. The technology does not exist to turn this waste into drinkable water nor remove radioactive isotopes. You cannot filter radioactivity. As a biologist, I am humbled by little we scientist know about the subterranean landscape over which we walk. I first realized this when I returned to my hometown Illinois to investigate cancer clustering there. As many of you know, I was one data point in that cluster. As a teenager, I was diagnosed with bladder cancer. 20 years later I discovered a dry cleaning fluid in the drinking water wells there. No one could explain to me how it got there. The underlying geology shouldn’t have allowed it but there it was. This is a jar of water from my kitchen tap in Trumansburg. It comes from an aquifer near Cayuga lake. Everyday I poured this water in glasses and handed them to my children. This morning at 9:00 a.m. out of this very jar, I drank a quart of this water in preparation for an ultrasound and a cystocope. An hour later I learned that the abnormal area in my bladder discovered by my urologist last December is still there. Now maybe it's scar tissue, more tests will tell, but I offer this jar of water to the Chesapeake Energy Company that this water is the blood plasma of my children and I will protect it.

[applause]

Mary June King: Thank you we will move along our next speaker is Bill Podulka.

Bill Podulka: I have to follow that. So I am with physicist. I live in Tompkins County and I want to focus quickly on just two points on the time that I have right now. There is no doubt that gas drilling brings money into a community in forms of royalties and other constructive events; however, a lot of money also leaves those safe communities and if you look at any number of studies that have gone on in real world, in the short term at best there are some positives, but in the long term the vast overwhelming number of cases show negative economic impacts and in particular those cost and benefits are spread unevenly in the population. You know things like cost of living increases. Huge increases in rents we have seen in Bradford County two or three times over the last year or two. A higher demand for government and social services all hit those least advantage in our society, the poor or those on fixed incomes more than the rest of us. The air quality which has gone down in Texas and Wyoming and wherever _____*1:21:15 (s/l pine galvin) is taken place impacts agriculture, outdoor sporting, tourism, all of them have negative economic impacts and I tell you I have been out in my community talking to rural poor about gas drilling and they get this. They get and understand. Only the large landowners who get enough benefit that they can compensate for all these negative costs that the rest of us are going to bear. Now I don’t begrudge those large landowners on their viewpoint, but my point is that their rational self interest is not good public policy. What we need to do is let the community decide whether the community benefits enough to allow gas drilling in. So that reduced to my second point which is that there better be some awful large social benefits if we are going to be taking on this activity and one of the ones often tried that is energy supplied and energy security and I want to tell you basically the numbers bare out that shale drilling does anything for energy supply or energy security that is significant. Yet there stands two things. First in shale, gas is widely but thinly distributed. Mother nature hasn’t yet done us the benefit of collecting it in one spot like ____*1:22:22 Black River Well. The second is that shale well production declines precipitously after the first year, about half production the second year and about down to two thirds production about the third year and continues declining throughout the time after that. What that means is that gas drillers have to continual chasing the falling production numbers by running around and drilling and drilling. This means tens to hundreds of thousands of wells to be drilled by Marcellus Shale and that takes time. You cannot celebrate your problems overnight of shale drilling because it takes to bloody long to drill all the wells. The time scale to develop the shale is similar to the time scale develop other more benign resources. So it is a good number. Today shale drilling gives about 14% of the gas production. That means that it accounts for only 3% of the

average we use in this country. Given that Europe uses about half the inch per capita that we do, do you really think that energy conservation couldn’t easily replace that 3% of our energy? Lets get the growth in the future. Over the next 20 years the energy information administration says that shale drilling will continue about to about 40% or 45% of the natural gas development in this country. That means in terms of energy 10% to 15% of the energy we use. Do we really think that if we placed the same amount of energy and effort into renewal sources and conservation that we could not make up that same 10% to 15% of our energy over 20 years? It doesn't happen overnight. So basically I would say that shale drilling doesn’t make a socioeconomic environmental sense for our communities.

[applause]

Mary June King: Thank you and now you will hear from Martha Robertson.

Martha Robertson: Hi. As a chair of the Tompkins County Legislature, I am the generalist in this group. I have to be concerned about all sorts of issue that will come up in our county if shale gas development came here. As documented in Pennsylvania and elsewhere, these include upkeep of roads and bridges, housing in a county where we already have a serious shortage of workforce housing, tourism which is a big part of economy, agriculture what will the impacts be, what about our wineries, water pollution, water depletion and fragmentation of natural habitat, air pollution and related health concerns, property values. Local mortgage lenders have expressed concern that gas leaks threaten property values. _____*1:24:47 readings integration exacerbates this situation. Assessment, fair taxation requires arms level assessment of the gas produced a huge new burden on our staff. Further state laws are hopelessly inadequate regarding mineral rights and split estates, increasingly for law enforcement, emergency response, fire fighting and social services. According to research and shale gas fields out west, these local government costs are incurred about ten years before any revenues flow. If those revenue do flow, they tend not to cover the cost that burden local governments. Our county is also fighting a climate change. We have a goal to reduce our communities carbon footprint by 80% by 2050. Therefore we must consider the research comparing greenhouse gas emissions of energy sources by Cornell’s _______*1:25:38, by the way Bob _____(s/l Howth) and Tony _____(s/l Agraphia) will be speaking here Saturday morning at eight o’clock. In the paper to be published next month they have shown that the greenhouse gas footprint of shale gas is significantly greater than that for a conventional gas, oil or coal. Primarily because of the potency of methane as global warning pollutant. Over a 20 year time horizon methanes warming affects are sending two times greater than those of carbon dioxide and of course the next 20 years are the most critical. The earth will reach its hitting point before that if we don’t alter out of projectory. So can I have the slide please, Jesse? This slide is from the _____*1:26:18 (s/l Howath) paper showing greenhouse gas emissions from left to right shale gas. The first two bars showing the low and high estimates in their data and conventional gas again low and high estimates than coal surface mine and deep mine and on the right is diesel oil. The blue bars represent the direct emissions of carbon dioxide during combustion. The narrow brown bars of the carbon dioxide necessary to the development use the energy source and finally the pink bars are the future admissions of methane converted to the equivalent value to CO2. The CE in the low estimate for shale gas is more damaging than the worst estimate for coal and oil. Contrary to the gas industries huge advertising campaign shale gas may actually aggravate rather than mitigate a global warming. So even if we could litigate all of the environmental concerns about hydrofracking it will take us in the wrong direction. Recent studies indicate that we could move a 100% to green energy sources within 20 years and we dedicate ourselves to that vision of the future. That is the future we should commit ourselves to without hesitation.

Paul Hartman: Good evening. I am Paul Hartman, the director of government relations for Chesapeake Energy Cooperation. I want to thank Ben and his entire team for inviting us to be here tonight to talk with you. It is a great honor to be able to come to this community and be able to participate in this event. As the government relation from Chesapeake Energy I just want to share with you who I am, where I come from and why this issue is so important to me personally. I am a lifelong resident of upstate New York, grew up in Utica. I have seen the precipitous decline in the economy in the areas that I have grown up in. I am a lifelong environmentalist. I worked for a period of time before coming on with Chesapeake as director of governing

relations to the nature conservancy. I began working on this issue from a habitat protection perspective. So I know and appreciate some of the environmental concerns that surround natural gas development in New York state, but I hope to bring to the conversation tonight a little bit more of a hope to discussion. Hope one for finding some common ground which is the theme of the presentation tonight, but I hope to look more clearly at the benefits that natural gas development and the resources that New York state has in terms of domestic resources and what those resources also mean on a natural and global scale. Just yesterday president Obama talked in more detail about his vision for utilization of natural gas domestic supply for offsetting our dependancy on foreign oil. That is a very important issue that often gets lost in the debate. Our real responsibility as a state, as landowners, as people that have access to a resource that would allow us to increase our domestic production. Natural gas development is not new to New York. It is New York. The first natural gas well was developed in New York state in Fredonia in 1824. We created natural gas development. We as New Yorkers have spent decades refining the process and refining the regulation. We implemented one of the first cases in the cementing programs to ensure the integrity of wells are being protected environment. We have the strongest regulations on the books currently and when DEC is through with their process New York state will hold the oil and gas industry to the highest standards that have ever been complicated for development. New Yorkers have a history of doing things right, taking their time and doing them right. We have spent the last three years looking at this very closely. We are confident that DEC will proceed a timeline that they deem as feasible and is a timeline that allows them to answer the questions that they feel are necessary to be answered with certainty before they issue permits for high volume horizontal drilling in New York state. Our future lies before us on the decisions that the state of New York and our residents make in the next coming months and years will determine the landscape for energy independence, for our economy and for our natural resources and I thank you for being part of that discussion tonight.

Rachel Treichler: My name is Rachel Treichler I am a lawyer from Hammondsport and I have been looking into the Marcellus Shale drilling issue for a couple of years. I want to thank the legal clinic for their excellent presentations on some fundamental legal issues here. What I think is the most fundamental legal issue is the question who should have the right to put toxics in the air that I breathe, who should have the right to put toxics in the water that I drink and who should have the right to put toxics in the soil where my food is grown and where and it is not just what I need to live and what other people need, what the animals, the other life forms that we share our planet. Who should have the right to put toxics into our world and what sort of legal system do we have that allows other people to do that? So when we look at who is going to be making the decision now about issuing the permits or the gas drilling it is not you and me, it is the DEC and how did the DEC get to the position that they can make this decision. They are not elected. Are they accountable to us? So when we ask these questions I think we say is this the sort of legal system that we want to have? What changes need to be made to give each of us an equal voice in making these decisions. Should these decisions be made in our communities and not by the state government or not by the federal government and when we talk about common ground I think we have to talk about common. We have to talk about equal power. Who is influencing the decisions. Do we each have the same influence that Chesapeake has in making these decisions and recent events in Japan highlight the desperate importance of these questions that certain officials at Tokyo Electric Power could make decisions for that plant that really affect the whole world. We need to look at the risks of different toxic forms of production and change. We need to change our legal system so that toxics cannot be put into our lives without our permission and you know we have to change, we have to change our ways or reduction so that we don’t have toxics.

[applause]

Mary June King: Next we will hear from Adam Schultz.

Adam Schultz: Good evening, welcome. Thanks for having us. Thanks for coming out. I thought the all school students did a great job with their presentations. Keep up the good work. Three minutes, I got to get through this quickly. I am in private practice. I have been regulatory permitting work and environmental impact analysis work for more than 20 years and those regulatory permitting decisions have to be made and are

made based on facts and based on science. They are not made based on anecdote and they are not made based on emotion. While this is a very important issue I encourage everybody that has been going through this discussion that we do base the decision making process whether it is your own opinion or ultimately what the state decides to do. That we base it on fact and science and not anecdote and emotion. Before getting going just out of my own curiosity how many folks here by show of hands have already decided that they are opposed to hydrofracking in New York? Okay and out of the folks who have their hands up how many of you have actually read the study that DEC has put out in 1992 and 2009? So maybe a quarter, great. Keep reading, keep learning. So quickly some facts. This is not a new technology. There is over a million wells, oil and gas wells in this country. They have been fracked since 1903. Oil and gas wells have been fracked since 1949. Horizontal well drilling has been ongoing since 1995. Thousands of wells in New York state have been drilled since 1992, 482 of them have been drilled in 14 primary aquifers and 2,413 within principal aquifers. Both very important sources of water. The New York program was implemented as a water protection program. As Mr. Hartman says the most stringent in the country we will continue to be. You cannot case a well through a water bearing zone if you are in a principal or primary aquifer onsite observing them. EPA has looked at this a couple of time. Everybody know that EPA is considering doing another study on it. They have looked at twice over the last ten years and determined it to be safe. 37 states in this country are part of what is known as the interstate oil and gas compact commission and that commission has never found a single instance of hydrofracking having it contaminated ground water. It is an important distinction. Hydrofracking has a contempt to get in ground water. It doesn’t mean that the well drilling process hasn’t at sometime been handled poorly but it is not from the hydrofracking because that doesn’t occur until later. It is bad cementing and it is bad casing that has been done. So with all that it leads me to the second point that I will leave you with as we get going here. That is the empirical evidence.

Mary June King: Time.

Adam Schultz: Okay I wont tell you the second point.

Mary June King: Our next speaker is Steve Gruskin.

Steve Gruskin: Good evening everyone. My name is Steve Gruskin. Until recently I was the executive deputy commissioner of New York state DEC and as you heard DEC is responsible for regulating this activity and until the end of December I was responsible for DEC. Since I have known last and I have heard all the problems that everyone has raised right now I am pretty glad I am no longer responsible for all these issues. Because all those issues are DEC’s problem. My perspective on this might be a little bit unique. I ran the statewide hearings on the SGIS. I have met with just about every interested party in this, all the stake holders. I have met with industry. I have met with environmental groups. I met with the landowners. I have met with just about everyone who has had something to say about it and my position is that there is an obligation on the part of the state to make sure that this can only happen in New York if the environmental issues are addressed the right way. The state needs to take as much time as it takes to do it right but not more time than that and that is the result that the state should achieve. So at this point frankly I am not really for or against. I am still curious. I am still looking to see what ultimately DEC decides to do when it comes out with the final SGIS. The two general points that I want to make tonight first has to do with New York’s approach. It is not an accident that there is no drilling in New York. It is deliberate choice made by DEC to think first before permitting this drilling. If this meeting was being held, this forum just about anywhere else in the U.S. there would be drilling going on now. The only reason it is not going on is because New York is taking the approach of deliberating it. Whether you think the SGIS is sufficient or insufficient, the fact of the matter is that this process has been done with an enormous public transparency. We have had over 14,000 comments that the professional staff at DEC has been going through it and looking at what's going on with other states and doing a scientific and objective analysis and the law is the way the law is now. It is DEC’s obligation to do it and that we have to choose a way for this to be done, I would say thinking first and drilling later is the way to go. My second big picture point is again sort of comes from my perspective of really being first hand exposed to all points of view is that I don’t believe that at this point the public debate is serving the public very well. I think

that it is actually refreshing to see everyone here at this kind of forum to be listening to the facts. The reality out there is that the public debate has gotten extraordinary divisive and it very frustrating from the regulators point of view. Right now the public is being relentlessly exposed to from all sides by way, I am an equal opportunity critic. I am not pointing the finger at anybody. I think that the pro-drilling and the anti-drilling forces are equally guilty of this. There is propaganda, speculation, gross overstatement, incomplete information and extraordinarily imprecise thinking that really borders on intellectual dishonestly as people are running around the state saying virtually anything to try to get people to decide whether they are for or against this. If you had to make a personal decision that is important to you, you would not do it based on half truths or _____*1:41:28, you would do it on fact, on the objective analysis and the science and that's what I would urge everybody to try to do here in the local debate.

Mary June King: We are going to take a short break.

[break]

Mary June King: Thank you for your patient. So at this stage of the forum I am going to ask this compound question that we are talking about and each of the panelist is going to have three minutes and they may be able to answer it, some will be less than three minutes which will be even better because then we can get to your questions that much sooner and again I will just kind of roll with it as far as getting to your questions. If there is just a lot of hands going up I will do my very best acknowledge maybe two or three people in a row and then you can put your hands down until I will say we will take more questions and we'll try to do it that way to the best of our ability. So we will start off with this question and I will start with you again John if that is alright. Why do hydrofracking opponents and re-opponents differ so radically about the safety of hydrofracking and the second part of can those opposed to those who support unconventional gas extraction find an alternative scenario that they both find accessible.

John Conrad: I can think of a lot of reasons why things have become so polarized and we are having trouble finding common ground. One of them seems to be we are bombarded with a lot of information about the Marcello shale and the potential environmental impacts and the environmental risks and I think at a time when we do have access to so much information much of the time we are getting that information without any real context. We tend to gravitate to web sites or sources of information that re-enforce our preexisting viewpoint. I think we are all guilty of that to some degree and we have to work harder than ever it seems, even with this flood of information to really do a good job at what examining what is real, what is important and what matters and so to a large degree I think it is the lack of context in which the information is delivered.

Mary June King: Thank you. That was really very precise.

Sandra Steingraber: I will start with the second question I am bringing a fracking abolitionist perspective to this. I believe there is no common ground on hydrofracking because fracking itself, which is not sustainable, undermines the economic and ecological conditions for activities that are. To extract a lot of bubbles from methane requires a lot of wells all over the landscapes, and pipelines and condensers and waste pits. It's a shock and awe operation. No matter how it is regulated the infrastructure itself industrializes our community, fragments habitat, compresses soil, sends silt into waterways and so interferes with natural flood control mechanisms and pollution systems upon which our apple orchards depend. No matter how regulated fracking removes water from the water cycle in tomes deep within the earth. That water will never again fall as rain, cascade through gorge, spawn a frog or be available for drinking. Fracking turns water into poison and makes it disappear and I believe that is an obscenity. No matter how regulated fracking and all the hazardous materials hauling that then companies generate smog and raises ozone levels. Ozone is a powerful cellular poison. It stunts lung growth in children and triggers asthma. Ozone also stents the growth of crop plants, in particular alfalfa, which is the basis for hay. That's particularly sensitive to ozone. So even an accident of a spill or an accident fracking can interfere with the ability of dairy farmers to pasture their animals and these are scientific facts. These are neither emotion or anecdotes.

[applause]

In Pennsylvania organic farmers who raised food near fracking operations are facing boycotts. Is that what we want here for a fossil fuel we throw the Ithaca Farmers market under the bus? Sometimes as much as may wish to otherwise two visions for the future are mutually exclusive and rather than seek common ground we need to realize we are faced with a choice. The glut of natural gas and the low prices that come with it are one of the major sources holding back economic investment in wind and solar power. The more we engage in extreme and increasingly dangerous methods of exhuming fossil fuels the more we divert capital investment from renewable energy.

[applause]

And as for the first question I think that the radical differences in perception flaw from actual contradiction. I was recently in Alaska, as you know there is a ______(s/l bum choy) *1:48:05 pipeline that runs from the north slope to Valdez. Lots of natural gas comes up with the oil and it could be sent down the parallel natural gas pipeline, that was actually Sara Palin’s idea, but it is not. It is just flared off as a waste product. It is burned, contributing carbon to the atmosphere and heating nobody’s house. Why? Because the glut of natural gas from fracking has made the profit unprofitable. The pipeline idea because of low prices is on ice. So we are being asked to sacrifice our air and risk our water and give up our peaceful ways to bring out of the earth something that we are told is a precious part of our nation’s energy independence and yet the same substance in Alaska is a waster product. I think that confuses people.

[applause]

Bill Podulka: So I think one of the reasons that there is some differences on the risk level is the lack of careful counting. Part of this made difficult by the use of nondisclosure agreements when people have had incidents in their wells or the stonewalling is _____(s/l candid) *1:49:09 in Pennsylvania. But a lot of us assumed the mixing of words some of which was evidenced here earlier, whether it's fracking versus gas development which is an issue and oh that is a casing failure, oh that was just a bad cement job, that was a traffic accident, that was a corroded valve. You know frankly I didn’t care how you poisoned me, I care that you are.

[applause]

There is barely enough to even possible that a regulator could claim that high volume fracturing has not been proven to cause water contamination. I think even that statement is challengeable. But if you change the question and ask them as a SUNY Oneonta professor did, what level or what greater problems have had with ground water and what, how many of them were their gas wells do you have and this guy found that he called into Wyoming, he called Texas, he called Colorado, there are approximately 1% to 2% of gas wells drilled cause problems with someone’s ground water and about 5% to 8% causes issues with surface water. The other issue is sort of the mingling, perhaps intentional of old hydraulic fracturing with new hydraulic fracturing. I am glad that the speaker here did admit that the horizontal drilling by slick water hydrofacturing is around 10 years old and many of the chemical being used not having been used for that long. We do not have good long term data on the safety of these or the environmental health impacts of them. Basically there is a lack of testing which leads to no information as opposed to testing to prove that anything is safe. Finally another aspect of this is who gets to decide what level of risk is this acceptable. You know maybe 1% is okay for someone over here but maybe it's not okay to me. So part of the debate isn’t just what is the level of risk, but what risk are we willing to tolerate and obviously the reward you might be getting could affect the answer that you give to that question. In general developing scenario by one per answer is no and by two-word answers is very doubtful and the reason is basically the bull in china shop sort of thing that I was talking about with energy development. The development of the shale requires lots of wells over a fairly short time span and this leads to all kinds of social stress, human impacts on and on and I would love to see gas drilling perceive a pace where these human impacts didn’t take place. But my guess is that the industry is not going to find that acceptable level because it

might be in my town five wells in a year, maybe it's one, maybe it is ten. I am not sure of what the number is but it's not thousands over five years.

Mary June King: I am just going to clarify the question again because they have the question so they know what it is and they don’t need a reminder. Just to remind the audience that the first part of the question is why would opponents and re-opponents differ so radically about the safety of hydrofracking and the second part is can they ever develop a scenario that they both find acceptable.

Martha Robertson: Why do people differ? I think you have to look at their relative interests. There is a really good reason why we think it is improper, for example for doctors to take compensation from drug companies or why scientist must disclose sources of research money. Like politicians with financial ties to lobbyist are considered dishonest. Understandably money affects a person’s perception of any particular issue. Gas companies and leaseholders, for example, have a strong incentive to feel one way because they have financial investments in drilling. _____*1:52:50 have a strong investment, a strong interest in other financial investments their homes, communities and their family's health. I think really you cannot look at it, you cannot see it that way. It is very hard for me. I must also say that also that one of the reasons for fear and anger around this whole issue has to do with how it got started where land men would come to people’s houses and not tell them you know anything about hydrofracking. It was oh it will just look like that old well that ____*1:53:26 put this straw down here and nobody will know it's there kind of drilling and you know later people come to find out it is a whole different animal. That plus in fact when people and there are many, many people and I am sorry if they are not anecdotes but many stories about people being severely pressured to sign. That's not a good way to start a new industrialization of an agricultural rural region. Can we find it jointly acceptable development scenario? Let me turn this question of common ground, which is the title for the conference. I heard Paul say it, our future lies before us. That is one thing we can agree on and that is why this is such a turning point, a crossroads for New York State. The political answer, can we find common ground? The political answer is yes hold off on drilling until we're sure it is safe. My honest answer is well maybe some people can find some acceptable development scenario but I think not most people. Many of the problems with shale gas development could possibly be mitigated but the cost that I have spent will be unacceptable to the gas industry and even if you could perfectly mitigate threads to water, air etcetera you can’t get around the problem of the carbon footprint and the distraction, the diversion of cheap gas takes us away from our urgent need to stop using fossil fuels all together.

Paul Hartman: I do believe that we can find some common ground. That is why the industry is very interested in participating in conversations like this conversation we are having tonight. There are yes a lot of issues that we need to work through as a community. There are a lot of issues that we have addressed over the last three years that have not been on the radar screen of most New Yorkers. I would have to guess to say that 99.9% of New Yorkers were not even aware that there had been tens of thousands of oil gas wells drilled in the state of New York previously. Why do we differ so much? Well part is because the industry has been quiet in New York. It has been off sight and out of mind. The industry may have taken that for granted as these new opportunities grow in the Northeast. Education on operations and impacts were not adequately done at the onset. We do not begin these conversations early enough so that we could mitigate the fear and some of the anecdotes and some of the uncertainty that surrounds a perceived new industry or an expanding industry in any community. Whether it be a new Wal-Mart distribution center or a well. There are a lot of community issues that need to be discussed and talked about and determine what the common fate of that community is going to be. That is why these conversations are so very important. I do believe that the intentions of all involved in this debate are to find the best common good and the best common good needs to be defined on the largest global scale. What are the impacts that we need to mitigate? What are the benefits that we need to achieve? How do we get there and how do we do it together? We do it together by sitting down and talking through. We do it together by a representative form of government putting in place the projections and the requirements and the safeguards necessary for us to engage in any activity in society. Any industrial activity, any educational activity, anything we do requires the collective input of our representative democracy. You all play an important role in that. I know that I would guess that most of you here have communicated with your

representatives sitting next to me and others on this issue. It is through that that we designate the authority to make those decisions on behalf of our collective good. It is up through that representative democracy that we have elected a governor that appoints a DC commissioner that is in charge with safeguarding the environment and implementing policies regarding drilling, regarding road construction, whatever it may be that comes before that agency. It is that process that protects our interest. It is the input from the community that informs that process. We have gone through three years so far on the process as it pertains to the generic environmental impact statement supplement. That will continue well beyond the issuance of the final. You will continue to educate both the industry, as well as your government representatives on how this is rolling out, how this works, how it doesn’t work and the things that we need to address continually. It is not a black and white issue. It is not a black and white process. It is something that isn’t perfect and we need to find the best solution in that imperfection.

Rachel Treichler: The question is why do people differ on the perception of risks and I think that they differ because they view those risk differently. The people who will have the exposure to the toxics or risk of exposure, people will have the risks of damage to their health to their property values those are the people who are concerned about the drilling. The people who will benefit from the sale of the gas who are not exposed to the toxics they find this to be a good idea and so the question is who gets to weigh these risks, how are they chosen? Who decides? I don’t call it a democracy to have these positions to be made of global scale. That with seven billion people in the world you cannot have democratic decision making on that scale. We here our experiencing this process which people all over the world have experience before us. We see the tar sands in Canada. We see the oil drilling in Ecuador. We see the nuclear power in many countries. Who is making these decisions for whose benefit and one of the things that I guess that most surprises me is ultimately I think everyone is going to suffer the consequences of the toxic contamination that we are putting into our atmosphere in every increasing amounts. Everyone is going to be damaged by that and their children are going to be damaged by that and I don’t see the short term interest in profit or the short term interest in domination doesn’t change that ultimate consequence of the decisions that are being made now and that we don’t have a voice in.

Adam Schultz: I sure hope that we can find common ground and I will get to that in a second. Why are the sides so polarized? I don’t honesty know but there are a couple of things and everything, you have heard six opinions on this already. There is no point in me repeating them. One thing that hasn’t been raised and I know there is press in the room but I think there is somewhat of an issue with sensationalism in the press and the press and media they have a product too and the way they sell their product is partly based on generating controversy and if you look at some of the reporting that goes on I think it is fair to call it incomplete so I think that is one thing. I think we need to make sure that we are looking at the issue in context. I think there is legitimately a tremendous concern with the unknown, absolutely legitimate. I told you that I have done permitting work for a long time. I can’t tell you how many industrial projects that I have been involved with there are community members who when the project director is first announced or proposed are very concerned about it and don’t think that they could possibly live with it and yet through engagement and through the process and once the project is up and running they find that a lot of their concern have been taken into consideration and have been addressed through the permitting court and review process and once they get to know the project they come to realize that it is not quite the parade of horribles that they once thought it might be. So going back to the context part a little bit, we need to get our energy from somewhere so we need to remember that. My concern that the conversation has kind of veered toward I will call it a zero tolerance. We are humans and humans are going to make mistakes. It is just our nature. It is unfortunate but it is true. But if we have a zero tolerance policy we all most of drove to get here tonight. Well 40,000 people a year die on the roads. If we had a zero tolerance policy we never would have had cars. We wouldn’t have airplanes in the sky. They fall out of the sky once in awhile. It is unfortunate but what we do as a community is we learn from it and we try to make it better and we try to make it safer and I think I will leave it with that.

Stuart Gruskin: So on the first question why do people differ radically I actually just put it down to human nature. Everyone comes to the room tonight with different philosophies, different experience, different expectations and different hopes and frankly I would be really alarmed if everybody came in with exactly the

same view and with an issue that is this important there really should be a very healthy debate. So I actually thing that the differences are good and I can tell you that as someone who is sitting as a regulator on this it is extraordinarily important to the process that there be these differences and that people express their views that way. So it doesn’t trouble me one bit that people have radically different views. I think we are New Yorkers we aren’t going to agree on most anything. In terms of whether there is development scenario that can be acceptable, you know we are in the midst of this very high profile issue with Marcellus Shale. It might be the best example ever of environment, energy and economic development considerations colliding and being linked together, but the battle for common ground is not unique to this. Right now there is battles for common ground going on border quality issues, on air quality issues, on acceptable contamination levels. When I drove up here today and saw the stacks from the power plant that Cornell has that is a function of a battle for common ground as to what the air emissions should be. The same is true for a water treatment plant and even the printing plant that has regulations for the chemicals that are used in the printing process. So I do think that there is and should be a solution to this that we arrive at after we have that battle. It has got to play out and it should play out vigorously and it should play out based upon the facts and the science. There will be at the end of the day a solution and typically what happens is that I have seen people really on a continuum. On the one hand you have the conservative environmental absolutist and say no drilling ever. The other end you have people who say we missed the boat. We should of started this three years ago and then in the middle you have sort of the environmentalists who are practical and when I say practical I mean saying we recognize that there could be some value to this but we better be damn sure that it is done without environmental harm and the landowners who were saying we love our land and yes this will personally benefit us but not at the expense of our land and the solution is going to be from those two middle groups. The two extreme sides, if they stay on the extreme they are going to end up losing their voice in coming up to the solution.

Mary June King: The panelists in their introductions to you didn’t tell them much about themselves. They told you a lot about where they are coming from which is great. So that just that you are aware in the folder that you received when you came in there is a little bio on everyone here.

Linda Adams: Hi, I'm Linda Adams. I wanted to maybe talk about some international examples. We've heard about Ecuador Development and what happened to that nation and some of the other nations in the world, but I have been looking at places like _____*2:08:01 who's had some pretty phenomenal success in a socioeconomic walk sort of manner developing their _____*2:08:13. One of things that frustrates me about Tompkins County is that right now we're looking at the worst cases and we really should be looking at benchmarks internationally that are superior. How has it been done in a superior manner?

_____*2:08:35: Can you give a specific person you're asking or have someone that maybe knows about some benchmarks in the world that are doing it right?

______*2:08:45: I can give an example that doesn’t have to do with the drilling but is probably something that everyone can relate which is the concept of waste energy, otherwise known as incineration. We have a history in New York of objecting to incineration, whereas in many European nations they are using wasted energy as a source of providing power to their communities. So I think your question is what accounts for this? Why is it that, that is being permitted in these other places and not here and it actually goes back to the battle for common ground. New York is not ready because the opinions are too different. There are people who believe that the technology is not there. That we will never be able to burn garbage in the way that doesn’t fowl the air in order to get the energy. There are other people who believe that the technology is developed, this _____*2:09:33, that technology and that it can safely be done. That debate is still raging here and you know I think eventually we might get there, probably no one here has read the statewide solid waste management plan. If you need to fall asleep it is good, but this is a discussion about that kind of topic and it is really a question of whether the public is ready for it.

Mary June King: Anyone else on the panel? Rachel?

Rachel Treichler: Yes I wanted to address the question. I don’t know the specifics about Norway but I think that your example raises questions that goes back to who bears the risk and where did the economic resources that are helping the Norwegian economy come from. Did they come from Norway or did they come from other countries. I know that Morris Energy, the state oil energy company is developing oil in Chenango county. It has a number of leases and is drilling and producing there vertical wells. So if they are getting the economic benefits from other locations that are bearing the risks and the damage from the toxics and this enforces the colonial experiences for the last 100 years that resources have been developed in certain countries and the profits from that development have been taken to other countries.

Mary June King: I have three questions from this side and then I'll do five from the center and then three from the other side and we will try to organize it that way. The gentleman way in the back...

Audience: Yes from the re-opponents I just had a question that you could answer and also the former DEC. I just wondered how many of you studied the facts? I was just wondering how many of you by show of hands have read toxic (2:11:27 ______)?

*2:11:34(Panelists?): I have talked to Walter. I have known him for 30 years. We don’t agree on everything but we do on many things.

Mary June King: Anyone else want to speak to that? The gentleman right here your question?

Audience: My question is how many of you are paid by the oil and gas industries or have had contracts with them? Have you ever had contact with ____*2:12:16 oil and gas companies?

_______*2:12:18: Not at this point in time. I've worked with landowners and groups of them.

Audience: Are people in favor of, do they pay you?

Audience: They haven’t paid me yet. And Mr. Conrad?

John Conrad: My company is a consultant to many different industrial sectors including the _____*2:12:39.

Audience: My point is that the question of who is in favor and who is not is it's pretty simple really. The people getting money are in favor of it and the people defending their homes and communities are against it. I just wanted to point out another stark reality I think that our society is facing is that the purpose of the business is to make money. It is not to buy a product. It is not to provide a service. They only do that at means to an ends and they only provide a quality of that product of service to the degree that they need to in order to stay in business and stay ahead of their competitors. With regards to safety, the safety to the oil and gas industry is a cost that has to minimized and it becomes a business issue to a degree that it becomes a public relation.

Mary June King: I'm going to stop you there.

Audience: Any way my question is...

Mary June King: Thank you.

Audience: Don't I get to ask my question?

Mary June King: No you're all set. You've used all your time up. Sorry about that. The lady in the front, the lady right there?

______*2:13:52: Can we address that?

Mary June King: Sure.

Audience: I need to ask my question again. Is it cheaper as a public relations issue and how it actually solves the statement problem?

Mary June King: We'll take two answers on that.

____*2:14:05. I'm going to let John address it but I want to engage on the communities and homeowners. Go talk to the folks in Steuben County. Go talk to the folks in the Southern Tier. You are talking about family farms and these people want the drilling and they want it done safely.

Audience: Not all of them. Some of them are in the room. [shh] Sorry don’t say those people some of us are in the room. I am from Steuben county and I live on a farm.

_______*2:14:37: If we are going to have a conversation then we need to let the people speak. I didn’t say every single landowner in Steuben County. I said there are people in Steuben County and other areas who are in favor of this. They see it as a way and they are banding together to make sure that they get very good lease terms and very good environmental protections. I am working with them on ensuring that. But their family farm is under threat and they see this as a way to save the family farm and be able to continue dairy farming and for future generations, so it's not a black and white issue as the gentleman would say and there's thousands upon thousands of acres in the Southern Tier where they have banded together and they want to see the drilling and they want to see it done right and Mr. Gruskin is familiar with that and that's one side of the debate but to say that the landowners don’t want is just it's not factual.

Rachel Treichler: Yes I would like to say that I understand that the Steuben County Landowners Associations is one of the largest landowners associations in the country. The president of the association is the owner of an LP Gas Company. I understand that he buys properties at tax sales and sells the surface rights and keeps the mineral rights. So he has quite a large investment in the development of the shale. He is not a farmer. I know many farmers who are very concerned about the impact that this will have on their farming.

______*2:16:24: I think to some of the previous comment where we have dialogue we are single out individuals and their individual interest has really created an environment where individuals are afraid to express their support for learning more or being thoughtful as the government agencies move through this process. The assertion that anyone that supports development, supports natural gas, supports the economic benefits, the energy environments, the economic benefits that come with natural gas development that they are bought and paid for is absurd on the face of it. There are organizations across the state that are rallying behind the potential that development brings with important environmental economic and personal safeguards in place. So just to merely indicate that anyone who voices a support for pursuing this as an option in New York is bought and paid for and that they have a financial interest is just an attempt to continue to divide people among the have and have-not’s which never produces sound public policy.

______*2:16:49: I want to talk about a couple of things. The fact of sensationalism in the press I think that is true to some degree but there has been some terrific work, for example by Tom _____(s/l Wolner) in the Binghamton Press and the Ithaca Journal a series you now that way before there was a sponsored grassroots movement there was a series that really educated a lot of us and the gentleman put it on the front page, not buried. The New York Times series _____*2:18:15, just go to _____ web-site. There's a ton of actual factual information, not hysterical at all. The issue of whether farmers had much choice in New York when milk prices are basically the equivalent of 1966 milk prices in real dollars, farmers don’t have much choice. When New York state has a 30 year project of increasing property taxes but reducing income taxes for 30 years they have been reducing income taxes, pushing cost of local government, pushing cost of state programs onto local government, raising their property taxes that is the second reason farmers are in desperate shape financially.

The reason a lot of people, maybe a lot of folks are looking for jobs and I don’t care what I do I am just looking for a job, just have to look at our trade policy. There is no way that government at any level can compete with the third world where people can be paid a dollar a month or week and there are no environmental regulations at all. Those are the big picture reasons that people are desperate for economic development in this region and around the country. So I think this is not just about sustainable energy. It is about sustainable economic development. You know what 70% of the housing units in the City of Ithaca that are rented. Landlords have no economic incentive to put storm windows on, to insulate houses. You know it's understandable. They just have the tenants pay the utilities and the tenants aren’t going to invest in conservation measures for those houses. We need public policies like the PACE program, property assessed conservation.... Oh what's the acronym? It's where homeowners and property owners can borrow money at low cost for energy improvements and renewable. Being held up at the federal level because Fannie Mae and Freddie Mac don’t want to be in second place on the mortgage list. So it is at the federal level that single property would unleash a wave of investment in conservation and renewables in every building in Upstate and around the country. These are insane policy choices that have put us in this position. We don’t have to be there.

Mary June King: We can keep answering the same question or there's a lot of people who have a lot of questions. Gentleman in red, please?

Audience: I have two questions, one for Mr. Hartman and the other for Mr. Schultz. When I asked my second senator, Senator _____*2:21:41(s/l Zolio). What's the big rush? Did summertime pull a fast one? He refuses to even define what trying to pull a fast one means and I want to know from you what's the rush?

Paul Hartman: Depends on how you define rush. I mean New York as we have been all aware have been reviewing this process for three years now. There are legal obligations that operators have with landowners with current leases. There is the need for the development of energy resources within the state. The last two years the domestic production of natural gas in the State of New York has declined. So we are importing more natural gas today then we were when we started the discussion on the SGIS. There are a number of reasons why a timely addressing of this issue is important. President Obama yesterday declared that we have an intention of reducing our foreign imports by 30% by 2035, I believe it was. Don’t quote me on the timeline. So there is a national movement to ensure that we are utilizing our natural resources in an efficient and timely fashion. So there are a number of factors that go into why development on a schedule that is sooner rather than later is important but is important also to review the fact that we have been looking at this in New York State for three years and what length of time of review is considered adequate to meet the impressions of people that are never going to be accepting of this opportunity any ways.

Audience: And that news to you when Dr. Steingraber who told you about the gas that they are burning off in Alaska because the price is too low? Is that news to you? Have you heard that before?

Mary June King: What I will do if we're going to be doing this if people have multiple questions in one is as long as the speaker has not used all of their time when they answer the first question I will just go until the three minutes is up.

Paul Hartman: I just want to make a point about this rushing and the DC has been accused of doing nothing too fast many times in this, but you know the drilling industry might want this to happen on a timeline. Landowners who are in favor may and by the way anyone who tries to paint with _____(s/l Roy Brosh) *2:24:07 and say all landowners are for or against it is just simply wrong. It's a mixed bag, but DEC is not on a timeline. At least when I was there we made it very clear that attaching a timeline to this would be arbitrary. How can you decide that okay by this amount of time we will handle all the issues. That is not the approach that the state is taking. The state is taking the approach of saying that we will take the time that is needed to address those issues and despite being battered over and over for a schedule we always resist it and said no schedule. It's going to take as much time as it takes to do right. So this concept of a rush making material to the

people who are anxious for it to happen and making material to the people who never wanted it to happen but from the regulator standpoint frankly it's immaterial .

Mary June King: Thank you. We have another question right here.

Audience: I guess these are directed to the Mr. Gruskin. One is that I know there is competing, competing interest around the state on this issue, but what deeply troubles me is the competing interest within the DEC itself with the mineral addition resources as one mandate and the DEC protects the environment has another. How can that work?

Stuart Gruskin: That's actually a very good question and our friendly law student highlighted the section of the ACL that states state policy with respect to mineral resources is another section is right at the beginning of the ACL that establishes what DEC mission is and at lengths protecting the environment to quality of life and that is actually the paramount obligation of DEC. So yes there is a legislative declaration. This was the legislature that invented, not DEC. The legislature said that to the extent that there are mineral resources in New York state we should try to take advantage of them to the maximum extent possible. But that is subordinate to the general admission statement which is to say that it has got to be environmentally sounds. So from DEC’s perspective, although there are environmental and energy and economic issues here it is not a balancing act. DEC has one mission which is to protect the environment and as a regulator that is what the goal is. So all of these other issues that are being debated in part of it those are the political issues. The regulatory issue is can this be done safely and if so how and that is what the DEC has been working on for three years.

Mary June King: Does anyone else on the panel want to address that question? Okay I know I have a gentleman here and two other people in this area, honestly I had four people around me all raising their hands. Who did I point to because I made eye contact with everyone I pointed to. No one remembers who I made eye contact with? Okay the gentleman in the back with black hair we'll entertain a question from and the gentleman up here in the front who is on the other side of the room. Just one question folks, one question for the panel.

Audience: Mr. Hartman, I suppose you two seem to disagree on the economic benefits of shale drilling in New York state and I was hoping to get a little back and forth between the two of you and Mr. Hartman if this is such a controversial issue does it not make more economic sense to do some other energy product in New York state?

Paul Hartman: I think that is a great question as to how we approach energy in the state of New York. The state of New York again is in the process of developing a state energy plan which should be in place by 2013 which will set forth the target for energy development usage, conversation and consumption for the next five to ten years. I think we need to insert natural gas development into that broader context of where does our energy come from? How do we develop it? How do we transition to a fuel that is both economically viable, environmental sound and is readily available in terms of quantity as well as price to consumers and industry across the state of New York. I look forward to the day when we are having these forums to talk that broader discussion as opposed to focusing solely on the extraction elements of natural gas or the reactive nature of nuclear energy or the unsightliness of the placement of wind turbines or the dams that lock fish movement for hydropower. I look forward to the day when we are having these forums and maybe Cornell will get to this for next year’s discussion on the broader scope of energy development usage and how we are going to move together to meet all of our needs, grow our economy, have sustainable communities and have that broader discussion. So I think it needs to be part of that global though.

Bill Podulka: I want to say is that with problems there are pluses and minuses and the question is what the balance, what is the net impact and the studies that you probably heard on the emerging giant tech stuff out of Penn State are all basically modeling fantasies that they only look at one side of the picture, so no surprise they find positive impacts. If you go out in the real world and look at what has really happened with resource extraction has taken place, this includes gas drilling or you name it, the results aren’t that positive. So you

know people here are probably familiar with some of the Headwater’s research that looked at western counties and found that those who did more gas drilling did less well and those that did less gas drilling. There is a huge review paper out that has looked at all kinds of mineral extraction found that by and large the cases where people did better were of the minority of cases where resource extraction followed and economic _____*2:30:10 this is called the resource curse. It is well known in foreign countries and this country that resource extraction is not that magic key to permanent economic development. So that you know should not be looked at as the ______*2:30:22 save Upstate New York. It just doesn’t work. You know the gas we are extracting here doesn’t necessary stay and benefit New York. It's going all over the place in the pipelines. But I like to _____*2:30:32 evaluated all energy technologies. This is the great idea. What we really ought to do to figure out the right thing on how to go forward from here is take a look at every energy alternative, give a life cycle analysis from start of it square one to when you finish with this race and evaluate the impact on human health, and human well being, on society, on global warming and on the economy and figure it out and the best person with the best work I know so far on this is a guy by the name Mark Jacobson out of Stanford and when he did this across Andrew Technology he overwhelming found that there were renewable resources like solar, either constant solar or panels, windmills, wave, water, hydro, all come out way ahead of the other fossil fuel alternatives. I welcome that challenge and I think we really have to look at that hard as a society.

Mary June King: Second row back here, right in the center.

Audience: This was a question that was sparked by Mr. Hartman’s comment about representative government. I am a taxpayer and retired. My wife and I were able to put together $250 to donate to campaigns from the presidential election all the way through to global candidates in the last election cycle. I also gave about 25 hours of phone call time. I would like to know from you, Mr. Hartman, how much did Chesapeake donate to the campaign of Governor Cuomo and the state assembly people and the state senate people in total?

Paul Hartman: We are confined by New York State’s campaign contribution limits. I believe if you check the campaign finance data we did not make a contribution to candidate Cuomo. We did not make a contribution to any of the gubernatorial candidates. I believe our total filing we provided $10,000 in campaign contributions to the state of New York last cycle for statewide. For congregational I don’t have those numbers.

Mary June King: I have one more on this side. So I will take this gentleman in the middle then go to the other side.

Audience: I am farm owner in ____*2:32:56 and this question is for the industry because 15 years ago the industry came through and was signing us up to drill into the Black River formation and my question is what is the situation with that? What has shifted? A few wells were drilled in the area, but it seems like there is really no movement with those resources. The land is all leased already. So I'm going to leave this partly in terms of the question of moving ahead swiftly when 15 years ago we started on those levels and I really would like to know the situation is with that?

John Conrad: The question is what are the plans for developing the Black River?

Audience: Right.

John Conrad: I honestly don’t know. I am not privy to those types of plans for the companies that are involved in the TBR plate. I don’t know if anybody else is here or not.

Mary June King: I guess nobody can answer that one.

Panelist? Bill Podulka? *2:34:07 _____ that obviously when you're doing a TBR well there is a hit and miss problem and you have to go with the hidden pocket. Whereas with the shale wells, it's there and you hit it to go

down. So it is an economic question. The companies that determine, as I understand it, that they can make more money on a shale formation so they've left TBR.

Mary June King: This gentleman in the front with maroon.

Audience: I would like to address this question to Mr. Gruskin. You talked about the facts and the access of facts that you encourage the public on both sides of this issue. I would like why DEC has not been as forthcoming with some of the facts and some of the industry segments that are this industry is dependent upon. For example, the salt tavern development at the end of Seneca Lake, which involves 60 taverns . Much of the information that we have received from you _____*2:35:12 has been redacted. It has been redacted under the proprietary causes for industry. Then you go to water the bill that is before the legislature today being rushed through to service apparently the gas industry because it only permits the withdrawals of 100,000 galloons and we both know that the tanker trucks that are servicing this industry and 6000 and 8000 gallon trucks that are LLC that are protected by their liability, as well as they are encouraged by the gas industry. The question is why do we not get the kind of information that is necessary for the public to draw the conclusions around this industry with all the pieces that are required?

Stuart Gruskin: I guess I disagree with your premiss in some ways, at least over the past four year the DEC we have tried to be extremely forthcoming with information, putting things up on the web so people wouldn’t have to make full out requests and the law contains a prevision that allows anybody industry or otherwise submits information to seek protection as the proprietary and DEC is obligated to apply that law as it is written and then there is a process for determining it. The water consumption bill, unless I am thinking of something different, the water consumption bill which I hope gets passed by the legislature is to plug regulatory hole. Right now DEC has jurisdiction to regulate water withdrawals for drinking water but not for commercial purposes and this is not a bill that would really generally speaking it is not viewed as protecting industry. It is a favorite of many environmental groups because it gives the state the power to regulate commercial withdrawals that right now are totally unregulated. So we may be talking about different things but if it is the water withdrawal bill that is supported by just about every environmental group as being very important environmental protection.

Rachel Treichler: I think there is a large grass roots movement environmentalists that are concerned about the bill including the group that Jack represents as a coalition to protect New York has raised questions.

Audience: I have basically two questions specifically hoping to be answered by Paul. It seems to be on our landowners coalition in Tompkins county, I also own a diary farm. My taxes have doubled in the past ten years and it is getting a little hard to pay. It seems to me that the gas fracking that is being adopted in Canada is something that can be very well copied here. It uses 95% less fluid down the holes. It doesn’t use any water and it has been proven safe. They have had 700 wells punched in Canada. They have had one failure and that was basically when they were trying to drill when it was too cold and the valve broke. I would like your comments on that and the other comment is I'm going to put you on the spot and I hate to but, if Chesapeake really wants to get some public relations benefit quit fighting us landowners about having our lease renegotiated automatically when the first terms of our lease going forward. It gives the impression that you are trying to stake us with the low values that we had five or six years ago, rather than let the things go. Let the landowners coalition work with you to get a proper lease so everybody is protected and this thing can go forward.

Paul Hartman: Can you just clarify me on the gas, are you referring to propane?

Audience: Yeah the propane, I call it gas fracking. I've been invited to go see one of the wells being _____* 2:39:41 to do something in Texas or Oklahoma later this year and I've been invited out to observe that.

Paul Hartman: The number of operators are looking at that technology to evaluate what its feasibility is for wide scale and usage here down in the states. There are a number of issues that come with propane fracking.

From a land use side it requires a much larger footprint. The path size would be much larger and that and then comes into play as to what our regulations are in New York in terms of spacing units and path sizes are. There is also concern that you are using a jellified propane which, up in Albany we had a propane tank that turned over two days ago and it burned for three days. So there are other safety issues that come into play when you are talking about using a large volumes gel propane at high pressure. But it is a technology that is being used in some places as you indicated. It is something that the industry is looking at its potential. While it would take care of the use of water we are talking about using millions of gallons of water as opposed to millions of gallons of gel propane. I think from a public perception when somebody heard that you were putting millions of gallons of gel propane in the ground there might be a little bit more of concern than millions of gallons of water.

Audience: The research I have done and the research that I have listened to is that it is 95% less volume of material goes down each well. So if you put a million gallons of water it will take 5% of that in the propane if I am understanding the research correctly.

Paul Hartman: We can get you more information on that. I don’t have that specific detail with me but it is an issue that was recently brought up and it is something that the industry is taking a closer look at to see what its viability is.

Audience: Because I think this would be middle ground I really do. I think it could be a win for the landowners and it (2:41:46 ___).

(Panelist): I am afraid your data is a little bit out of date because in the last few days there has been a second accident in propane fracking that has occurred in that company that just shut down to evaluate what went wrong in that case five workers were injured in that explosion I believe it was last week or so in Canada. And the other issue that Chesapeake and everyone else when look at is to date I don’t think any good evidence has been formed to show that propane fracking technique that can be used in long lateral sections that are typically going to be used in Marcellus Shale. Certainly no pure reviewed results on that, as well as the question is there enough propane to frack enough wells? I actually personally am really happy to use propane because maybe they can do that one well a year that I'd like to see.

Stuart Gruskin: I just want to make general points about environmental regulations driving technology that this whole Marcellus shale initiative is a very good example that is probably appropriate that when the companies wanted to enter New York and they saw the kinds of requirements that New York was going to be asking for it began to drive the technology and I think that is a very good role for environmental regulation and some of the things that you recently read in the New York Times about the waste treatment actually was covered by Pro Publica in 2009 because DEC took the position of saying no permits are going to be issued unless there is a cradle to grave approach to this so we know what is going to happen and there is no facilities in New York that are able to take this that got industry thinking about wait a second what can we do to be modifying our processes, to be looking at other things including, I heard also, not recently but I heard about those initiatives in Canada and I can tell you that the staff at DEC is looking at all of those other techniques, technologies and so on as well.

Audience: Excuse me that waste is already coming to New York State.

Mary June King: We have a couple more people on the panel that would like to address this question.

Panelist?____*2:43:52: I am going to bring this back to the carbon footprint again. The total life cycle carbon footprint, global warming. Does it really make sense to use fossil fuel to get fossil fuel. I am really glad this has been raised. I hope that this issue is raised in other panels the rest of this weekend. We really have to find out where research is and direct research on the total footprint, the global warming cost of whatever energy sources we use or chose not to use. So I have a question for Stu if I can do. I want to know if the environmental issues that DEC is considering on the MGIS, does this include the life cycle emissions?

Stuart Gruskin: I think you've asked me that question before and I can speak for DEC. After you came up to the office with the other people who were studying that issue it was put on the table and is part of the mix of issues that is being considered. Along with that is the sole concept of bringing completions and you know all the different ways that the fugitive methane can and should be addressed, so yes the reason that this is taking so long is because there are tons of issues and they are complicated. I think that after DEC we got 14,000 some odd comments that got separated into about 1,300 categories. So we are looking at a very, you know it was a very apt observation from the excellent presentation on _____(s/l Secor *2:45:37) that this really has to be a very comprehensive review. That is taking a long time to do and it is not because people are slow or lazy. It is because they have a real mountain of work to do.

Audience: Is DEC interested in the EPA study?

Mary June King: I'm sorry and we have two people who are recognized for questions. Oh I'm sorry, Rachel, you wanted to say something as well?

Rachel Treichler: I wanted to go back to the question about the water bill, pardon my coughing but I think this is a very significant piece of legislation that is being rushed through our legislature right now. It is as significant almost the draft supplemental which is getting years in review and 14,000 comments. People do not understand the implications of this legislation, in my opinion. What it is going to do is? It is going to give the DEC permitting authority to allow water withdrawals that are beyond what is now allowed under our states common law water rules and the consequences you know I just urge the people to study this legislation. I would welcome an opportunity to talk with people afterwards about all the consequences that will flow if this permitting authority is granted.

____Panelist *2:47:00: We're back to the water bill. The bill in front of the legislature at the moment would require a permit for a water withdrawal for more than 100,000 gallons per day. There is no permitting requirement current. If you are in the Susquehanna River basin area then you need a permit for water patrol. If you are in the Delaware River basin area you need a permit for water withdrawal. There is a Great Lakes basin commission _____*2:47:26 that has recommended rules on controlling water patrol. This bill is intended to cover that swath of New York where there is not a permit program in place. Maybe we are talking about two different bills but this is actually a bill that is going to require a permit where one is not required.

____Panelist *2:47:49: Excellent. I also want to make a point that this bill was introduced last year. It was passed by the senate. It is not if this is some secret thing being rushed through. This has been around for two legislative sessions and I am always puzzled by the theory that if the regulatory authority is not going to be perfect lets not have it all. It is better for DEC to be able to control water withdrawals and have some regulatory power then to have no regulatory powers, no controls whatsoever. But maybe this is one of those common ground issues.

Mary June King: The panel got out of control we got a minute and 45 seconds on the clock. Mr. Gruskin would you like to finish it off.

Steve Gruskin: So my understanding that one aspect of this bill is that it allows a private landowner to indeed sell and access the water on their land to give to a company whereas current law actually does not allow one landowner to withdraw enough water to impact a downstream landowner. That is my understanding of the one of the things that changes is existing law that says you cannot take enough water out to disturb another person in the same water source.

John Conrad: Those are references to a repairing rights and it does not change repairing rights law of the state of New York at all. You still can’t harm a downstream.

Rachel Treichler: What is the difference of getting a permit? That is a priority right. So the people who have the permits will have priority over the other uses if there is water scarcity in the future. The permit is a right to take and the people with the permits who are those users of 100,000 gallons a day or more, except for agricultural users I think that the farm bureau doesn’t understand the full consequences of this when they got an exemption for agricultural use because now farmers will not have permits and if there are disputes between farmers are permitted users, those will the permit will have an argument that they have priority over the farmers.

Mary June King: I'm going to have to say it would be nice if we were all sitting around a nice fire with our feet kicked up and we were having a conversation but there's too many people to do it that way. So I am going to move ahead to a couple of questions so that each get to ask a question and then I will go back to the center of the room.

Audience: This question is for Mr. Conrad. You opened your discussion by expressing concerns about misleading facts that were out there that are unsubstantiated. You then proceeded to use the phrase the fracking process itself and then went on to talk about you know documented claims. I'm sorry, proof of farm _____*2:50:38, unlike Mr. Schultz who was kind enough to make a distinction between the process, fracking process itself and the drilling process. You opened up with talking about misleading things, omitted that. So this is my question that I have. I observed that if that was purposeful then I would be disingenuous and it was not purposeful then might cause _____*2:51:06 repeating the question, but that's not my question. You spoke repeatedly, you terms like exaggerate with low probability unlikely to be a problem. There was also a question from the audience that was upset with the fact that people seemed to be anti, seemed to be concerned with so-called worst case scenario. So I have, I'm a lawyer.

Mary June King: Please ask your question.

Audience: Okay. I'm a lawyer and I have an idea that I think that since the whole purpose here is common ground and I would like to ask you from a policy standpoint what do you think about this idea. What I would like to do is take everybody who is in a business such as yours and everybody who is a lender to any of your clinics or to people such as Mr. Hartman’s employer and I am sorry as a lawyer, but anybody like Mr. Schultz who represents those people and landowner who is not misled by a land man or who otherwise feels that the process is safe.

Mary June King: Five seconds.

Audience: Given that you think it's unlikely anything could happen, what I would like to have would you have a problem with a law that may have you strictly liable, cradle the grave throughout this process including what the lawyers called piercing the corporate _____*2:53:36 , so we talk about offices directly sharing...

Mary June King: Ask the question.

Audience: Unlimited, that is the question, cradle the grave? That means if they took it from your farm and then they spilled it you know on somebody else’s road since it ain’t going to happen and it is exaggerated and unlikely, what do you think of that?

[applause]

John Conrad: On the first part, I wasn’t being purposefully narrow minded in my opening statement and in fact what I was trying to was make the point that the issue that I did describe was almost overwhelming all of the other discussion about all of the other potential facts and risks and I look forward to the time when we can examine with a full array of risks and impacts. As far as your second question on that, I wasn’t taking notes but the State of New York already has brought forth to protect the environment, as Stu said...

Audience: Enough said. It's a yes or no answer and then you just answered it.

Mary June King: Mr. Conrad, you have three minutes to address the questions.

[talk among audience]

John Conrad: And I am probably going to have to refer to a lawyer on that question about strict liability, but the regulatory framework here in New York is probably as strong as any other state and DEC has brought authority to enforce regulations to protect human health and the environment, which they do and that includes strong liability exposure for those who break those regulations. So I am not sure if I am answering your question.

[talk among audience]

Audience: This question is for Mr. Schultz. You cited a scientific study that said that there was no water damage in one billion frack jobs. I wonder what that source of that survey is, how long it is and what degree of scientific sound is used direct in that study?

Adam Schultz: Perhaps I wasn’t clear. I didn’t say there was no single study was out. What I was reciting to you were the facts about the number of wells that have drilled in this country throughout the country. Other facts were in regard to wells in New York state and I believe I cited the interstate compact commission and you can go to the interstate compact commission, you can go to the web sites of any of the various states, whether it is in the western states or in New York. You can look at the New York SGIS where is says in the SGIS there have been no documented cases. So it is not a single study. I am talking about the collective body of knowledge which is developed not by industry but by the folks who regulate this process.

Martha Robertson: Yes as far as documented cases of contamination. I am concerned about that because if somebody is faces with their home is ruined, their water is ruined, which is that their home is ruined. The gas company comes along and says here is $30,000 and five years worth of water but you have to sign away that you cannot talk to anybody, you cannot talk to the feds. There goes your documented case. It doesn’t mean the contamination didn’t happen. I am pretty sure we are not going to get closing statements so I am going to rip off a couple things really quickly. On the idea that Paul said the industry has been quiet in New York. Interesting I can’t turn on the news without at least three ads from that lovely lady and an infiltrative NPR too which really bothers me. The question of zero tolerance of risk and the public’s fears and concerns, I face the public, you guys, often about things that you are not really keen on, you know a road project or _____*2:5:29 and people aren’t afraid of what they don’t know. People like, we like our community to like their quality of life. So it is a natural thing that people are afraid of the unknown. It is just patronizing to say that that's unfortunate. It is human nature and as a public servant, I have to address that and make sure the people know. You know I have to find out what their concerns are and get them real information and you know it's not something that _____*2:57:32 if the people feel like they have been treated honestly they come around on whatever it is. I will say that the big issue about fear is the scale of this operation. The fact that Brad Gill from IOGA came. When I first met John Conrad was in our community center when John and Brad came in and addressed our community and somebody asked, well are you guys going to drill everywhere in the Marcellus Shale knowing that it's a carpet? You know it's not straws that you put in different places. He said well yes eventually. That's the problem, aside from all the rest, that's the problem. As far as Obama’s energy policy I will say that this movement in New York has astonished, I think, everyone. We never thought we would be where we are in a million years and thanks to Stu and others of the DEC actually listening, we have changed the conversation, not only in New York but in the country. When we finish in New York, I think we are going to Washington.

______Panelist *2:59:01: I want to speak a little bit to the question of the no documented cases because documenting environmental contamination and clusters in health effects. Because of those is what I do and I

get asked this question a lot. The problem for us in a scientific community is because the gas industry is protected from all the federal exemptions including the right to know law. We don’t know what they are fracking with, therefore when we see chemicals that we know are linked in some cases to fracking turn other people’s water, we are unable as a scientific community because we are blinded. We can’t do the studies. So in that case the no documentation is a staple of ignorance not a statement that we the scientists have this information and we have gone out and tested and we can’t find those chemicals in the well. That is what the DEC as a standard for strict liability. I am still trying to wrap my mind around that one. I was in the Hudson Valley recently where as you know, the DEC has been trying to enforce for 30 years General Electric to clean up the carcinogen PCB’s in the world’s biggest Superfund site. Interestingly GE’s arguments are not wanting to clean up the Hudson and pay the money. Involves the claim that drudging would be futile because PCB’s its factory floor continue migrate into the river itself through naturally occurring fissures in the bedrock, therefore dredging it all out is futile because it is going to keep seeping through the bedrock so why bother. So okay so fracking components tell us the shale is so impermeable we never have to worry about toxic fracking fluids migrating from it, through it, but GE claims it doesn’t have to pay because the shale is no permeable what's the point of dredging. Now one of those two stories is not correct and the DEC is not helping us understand which is the true story.

[applause]

_____Panelist *3:01:06: Can I address that one because it was directed right at DEC and I happen to be the person who as Jeff ____(s/l Immalt) was leaving Lisa’s Jackson’s office of the EPA, I was walking into Lisa Jackson’s office at the EPA to make sure that the EPA did the best that it could to hold GE’s feet to the fire to make sure that there was dredging instead of capping into the Hudson river. I think that this may be an example of how easy it is to sort of mix up apples and oranges. The issues with PCB’s are different with issues of fracking and it might be nice in a room like this to say it is the same thing, but if you are a regulator you are going to get sued by everybody and you need an administrative record that is going to be precise and that is going to be based on science and that is going to be objective then you can’t mix those things up. So when you look at the difference between in fact, if you have fracking that is going on at five or six or seven thousand feet is that going to get to the aquifer or is the problem well casing and the surface moving to the water. Where in the process is the problems. This is the kind of precise thinking that you need. When I was talking before about the debate and finding common ground and how do we do it. I think we need the debate. I think we need the competing points of views but most important I think we need good facts and we need precise thinking and we can’t be mixing things up. If there are five or six different aspects of this process we have to look at each of them individually and we have to figure out if something is going to go wrong and exactly where is it going to go wrong and how do we deal with it and that is what DEC has been trying to do. It doesn’t do the public a service and it doesn’t do the government a service to be too general, to be mixing these things up. What helps the DEC, what helps the government is to be hearing from people like you about your concerns. It is good to be saying we are worried about this because this and because of that. It is not so good to just say we are worried about it. You have to come forward with what aspects are you concerned about. Where in the process are you thinking that it might be adversely impacting? That is the kind of information that is going to help the DEC ultimately come to a good determination.

Mary June King: One more question and then we're wrapping up the evening.

Audience: Just a few points quickly. So the DEC is not going to find that there has been a problem with water _____*3:03:32 investigate. There are a number of cases like. There are at least some in ____(s/l Chisago County). A landowner had a water problem and hired a university scientist to investigate who said yeah there are problems here and you can send stuff off to DEC and the guy in Albany said I think we are not going to bother and take a look at that and not bothering to go out there. So my question to Stu is convince me, you know everyone here and Pat from DEC on the back. We are the greatest, strongest DEC in the country. I think DEC has been asleep at the wheel here. Why wasn’t there an original SGIS no can make that analysis? The one thing that we know about shale drilling that it occurs everywhere in water wells. That is the key feature.

Why not look at that from the beginning? Why so late in the game does Syracuse and New York State Watershed say oh that is right their FADs? Why did that happen then and not at the beginning? What about there is an analysis and there is a commentary in the SGIS about how wonderful the economic benefits are when any common economist would look at that and say you know there is pluses and minuses in the trade-offs. Why wasn’t there any critical analytical thinking applied to that kind of stuff? It reads like the industry wrote the document.

Stuart Gruskin: I will tell you that the feedback that we got form the industry is not that reads like an industry document. When we came out with a draft SGIS it represented an attempt to put the issues on the table, to inventory them, to propose litigation and yes there were clear deficiencies in it. No question about it, but it was a draft. It was meant to inspire discussion and as I went around the state and conducted the hearings and started and went from New York City through Elmira and in total there about five or six thousand people who went to the hearings and then 14,000 comments have been received on it. It did exactly what it was supposed to do. It was supposed to get people thinking. We got great comments from the city of New York. We got great comments from a coalition of the river keeper and the Catskill mountain keeper and a bunch of environmental groups. We got very good comments from industry as well. We got comments from the farm bureaus. We got comments from local governments like the counties, the towns, the highway supervisors. They all had something to say about it which will inform the ultimate decision. This was done with transparency and I can’t sit here and say the cumulative impact analysis was good enough. It wasn’t and we acknowledge that I think it was in the document. It was clear that that wasn’t a good enough analysis and it is going to have to be good enough. There are some areas that have to be examined more and there are some areas but virtue of the commons they know they are going to have to look at more. But it got the process going and the debate going and in the meantime there is no drilling going on. So if there is a way to handle this problem I would say the way to handle it is to get everyone thinking about it. Get what everyone has to say, consider it and then try to come up with it. Until DEC comes out with the final product frankly I don’t think anyone here can know whether it is going to be good enough or not.

Mary June King: Our next question of the evening it the gentleman in the way back.

Audience: This is a specific concern that you guys were talking about. It comes from the New York Times article that you guys have been addressing. One of the things about hydrofracking is it produces a lot of waste water so I have heard. That waste water is contaminated with highly radioactive materials a lot of times, high levels of salts and undisclosed fracking materials. According to the New York Times, more than 1.3 million gallons of waste water is produced by Pennsylvania wells in the past few years. Most of this water was since treated at a treatment plants not of which were removed making the toxic materials in drilling this. This water then gets discharged into our rivers. One of the plans that accepted waste water discharge into _____*3:07:45. So I want to know what you are doing to protect us from these potential materials that waste water treatment plants are not able to treat? And actually, Mr. Hartman, I would feel much more comfortable if you would drink some of her water.

Mary June King: Is this for Mr. Hartman?

Audience: It's for anyone who can answer that.

____*3:08:08 Panelist?: I just want to make a point that if you go back and look at the Pro Publica stories and by the way I encourage everybody to go look at Pro Publica’s coverage of this because it has been very comprehensive and it really does tell a whole story and in a way that I think is useful, but in December of 2009 Pro Publica did a story about the waste water limitations and I remember it specifically because I was quoted in it and I was quoted saying that the limiting factor for this industry in New York State is got to be the waste water treatment and if you go to the SGIS, the draft, you will see that there is a discussion about exactly all of those problems that you just raised. So this is not a new issue. It's actually one of the issues that has been on

the table from the start and the position that New York has taken is that this is a problem that's going to have to be solved before permits are issued.

_____Panelist?*3:09:06: Just quickly one of the important things that I think that is important to realize that you just touched on is that here in New York in order to obtain a drilling permit you have to be able to tell the DEC in that permit application how much fracking fluid you are going to use onto water, how much waste water is going to be generated and what is going to be done with it and if you cannot do that at the time that you apply for that permit that permit will not be issued and that well will not be drilled. So there is already a mechanism within the state to make sure that waste water is properly looked at from the beginning.

______Panelist? *3:09:38: Although the DEC does not reveal that information, they just told us very recently that they did not have the capacity to give that information to the public. That would be very confusing and there would be too much data to tell people where the waste water from a specific permit is going and what conditions are in the permit.

Adam Schultz: To the gentleman’s question, a couple of weeks after the New York Times article came out, Pennsylvania and the DEP, Department of Environmental Protection, actually went downstream of those complaints and tested water and they did not find radioactivity in the water. It is on their, the study is on their web-site. So I would encourage you to take a look at that. I'm not saying it is not an issue, obviously it is an issue that needs to be dealt with. If you go back to the SGIS centralized forum conference, if the industry is being used a centralized water _____*3:10:36 they would do have to a site specific environmental review. What does that really mean? That the DEC is now _____*3:10:41. I make my living fighting these guys for the last 20 years.

______*3:10:46: I'm not part of these guys.

Adam Schultz: No. I can't help it, but I got to tell you and really that's how I make my living is dealing with this agency and I know that the agency must be doing something right because everybody hates them. But I got to tell you on the SGIS and the efforts of the folks in the minerals division, they are working their butts off and they are doing a fantastic job. It is not perfect, again I'll go back to it. We are human beings, we are not perfect. But we have got to have a reasonable compensation. Right now we're taking a lot of dollars out of this country, shifted overseas to governments that then fund people who hate us. We have got to find a way. We have solar projects in California that are being opposed. We have these wind projects throughout the country that are being opposed. Is natural gas development the perfect solution? No it's not, but it is better than the current situation and it can act as a bridge fuel to as we implement things like conservations and other renewable resources. You have to keep things in context. We all still like to turn the lights on we got to find a way to do it.

Martha Robertson: Natural gas development will keep us from going to renewable sources and conservation. The meeting that Stu talked about, _____*3:12:04 Washington was Deputy Commissioner of the DEC and she at that meeting said the problem is with the waste water is the salt. If we knew how to get salt out of water we wouldn’t have a global warming problem, number one. Number two is a catch 22, Mr. Conrad. The companies might know what they are putting into the well but there is no way to know what comes out. It changes everyday. It changes every time you frack. So therefore if you are trying to get a permit from a waste water plant you actually can’t tell them with any real confidence what they are going to be dealing with. So it is an intractable problem, it really is and I wish people would understand that. It's really and the other thing that we haven’t talked about is the complete removal from our ecology from our water cycle from these quantities of water. It's really a fog to think that that water is just gone. It's pretty much we won't ever be able to use it again. This is something that New York that the northeast has something so in spades that we are taking it for granted and ____*3:13:33.

Mary June King: Mr. Hartman.

Paul Hartman: I think you started your question by asking industry what you're planning to do with this. Six opinions later we get answer that question for you. We are in fact technology drives innovation and the innovation that the industry is employed right now is recycling and reuse. We are not sending waste water to municipal waste water treatment facilities. We are recycling the water that is produced. We are recycling the water that is produced. We are using it on our next fracturing jobs. Pennsylvania tracks the water that we withdraw, tracks our recycling of it and tracks our re-fracking of it. So we know where are water is going and we know where the water is obtained and we know where we are sourcing it and where we are using it in our fracking jobs.

_____Panelist *3:14:24: At the end you still have poisoned water. What do you do with that at the end?

Paul Hartman: We are in the process right of continuing to recycle and reuse that water from fracking job to fracking job. So we are at 100% reuse. We are not disposing through municipal waste water and treatment facilities in Pennsylvania anymore.

Mary June King: Alright that's it for tonight folks. We have a couple of announcements to make. One is that tomorrow everything starts at noon at Anabel Taylor Tower and another is that there is a donation jars out there that somewhat helps the Environmental Law Society put these on for free, no charge to you and there should be a web-site coming up here. It's Cornell.environmental.law@gmail.com. If you have further questions for the panelists, Ben will do his very best to get that communication going for you so you can ask the questions directly of them. Thanks for coming and thanks to the panelist and thanks to the law society for putting this on.

Ben Tettlebaum: Thank you very much. Just as you exit the building there are people there that will help you if you get lost or if you need any how to get where you'd like to go.

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