President Donald Trump singled out New York and its governor, Democrat Andrew Cuomo, for his opposition to new natural gas pipelines in the state during Trump's speech at an industry conference in Pittsburgh on Oct. 23.
Major lines have been stalled or blocked on state authority in recent years, including the Williams Cos. Inc.-led Constitution Pipeline Co. LLC and the PennEast Pipeline Co. LLC systems, which would deliver natural gas from Marcellus Shale fields to New Jersey, New York and eastern Pennsylvania. New York has also blocked National Fuel Gas Co.'s Northern Access and Williams' Northeast Supply Enhancement pipelines, crimping in-state capacity.
"New York should allow pipelines to go through," Trump said in his speech at the Shale Insight 2019 conference, hosted by industry trade group the Marcellus Shale Coalition at the downtown convention center. "There has to be something we can do," Trump added.
Under Cuomo, New York banned hydraulic fracturing in 2014 as a health hazard, effectively cutting off development of the portion of the Marcellus Shale along the state's Southern Tier of counties north of Pennsylvania and has used its authority to deny water permits to most new-build gas pipelines, as part of a general policy directed at lowering fossil fuel use.
"It never made sense to me," Trump, a New Yorker, told an audience from both the industry and the general public, invited for his speech. "They don't drill, they don't frack." Arguing that in-state shale development would help New York to pay off its debt and cut taxes, Trump said he would "be talking to Governor Cuomo," without giving any further detail.
"They're sitting on a gold mine of energy," Trump said.
Fifteen years into the development of its shale gas resources, Pennsylvania, which has a per-well impact fee but no severance tax on gas production, still carries billions in state debt and has not lowered its state taxes appreciably because of gas development.
Trump said New York is not only blocking itself off from cheap Pennsylvania gas but the New England region also, with its de facto ban on new pipelines. "We can't let that hold us up," Trump said of New York's policies. "Energy prices in New England would be cut in half" if pipelines could be built through New York, Trump claimed.
The bulk of Trump's speech touched on what he said were his accomplishments at bringing back the coal industry, eliminating former President Barack Obama's Clean Power Plan, loosening regulations on energy producers, and igniting an energy boom in Appalachia.
He also took time to endorse local Republicans running for office and pressure Democrats in Congress to take action on pending trade bills.
Referring to his speech three years ago at the same conference, Trump said he delivered on his promise to unshackle the energy industry from regulation and claimed his actions have driven the fortunes of the gas industry to new heights.
On the eve of their third-quarter earnings announcements beginning next week, most Pennsylvania shale gas drillers are struggling to make profits as the commodity price of gas stays below $3/MMBtu, making it difficult to generate any returns for investors.