Drillers over in Pennsylvania are scaling back their Marcellus plans. This isn’t because of any natural or technological issues, but because of government bureaucracy. And that governmental interference isn’t solely a matter of environmental protection. Much of the difficulty seems to stem from simply bureaucratic delays and red tape, and uncertainty about the regulatory process.

We’re not advocating an attitude of “damn the environment, full speed ahead”. The point is that we must avoid flushing potential money down the drain just because of bureaucracy. Let’s be sure that the process is as efficient as possible. If drilling companies have to waste money waiting for extra signatures, or have expensive equipment left idle waiting for a bureaucrat, that’s less money they’ll be able to pay landowners, or pay to employees, etc.

CNNMoney reports:

[Gas drilling executives] say the economic windfall expected from the Marcellus shale may not come to pass if Pennsylvania doesn’t get its regulatory house in order.

Industry officials complained Tuesday about a time-consuming and lengthy permitting process and cumbersome regulations that, on top of plummeting natural gas prices and the credit crisis, is making it difficult for them to operate in Pennsylvania.

“I have great hopes for what the Marcellus shale play might still hold for Pennsylvania. Unfortunately, my experience to date does not lead me to be very optimistic,” [said] Wendy Straatman, president of Exco-North Coast Energy Inc.

A report in the Pittsburgh Tribune-Review relates a similar story:

Atlas Energy Resources LLC of Moon, for example, shifted 40 percent of its well-drilling program for the winter and spring — $100 million in investments — elsewhere, primarily to Michigan, Indiana and Tennessee.

“That’s too bad for Western Pennsylvania,” CEO Richard Weber said but, “When there is this much regulatory uncertainty, it makes it hard to budget.” Applying for permits in Pennsylvania can be a time-consuming, costly process, he said, forcing the company to wait for months. …

Companies hoping to tap the Marcellus region still compete with drillers in other states. In Texas or Louisiana, producers can submit a one-page application, promise to adhere to thick manuals and start drilling the next day, said Matt Pitzarella of Fort Worth-based Range Resources LLC, whose Washington County office has expanded from 20 workers to 150 in the past year.

“Here it’s like you are writing sections of that manual every time, and that’s where the delay is,” he said. “People would say we want (permits) faster because we want less regulation, and that’s not the case.”

State officials are aware of the problem.

State Sen. Mary Jo White, R-Venango, said she hopes the permitting process for companies using new well-drilling technologies can be streamlined.

“This is a wonderful opportunity, and we don’t want to blow it,” White said….

Terry Engelder, a Pennsylvania State University geoscientist who recently estimated Marcellus could hold more than double the gas previously thought, agreed the process for permitting horizontal wells could be made easier.

“The regulations do evolve in time — they had to for vertical wells,” he said. “Suddenly this new technology came along and everyone had to do a double take to adjust to the horizontal drilling rules.”

This is echoed in the CNN article:

Sympathetic GOP senators pressed acting Environmental Secretary John Hanger for answers, warning that Pennsylvania can’t afford to scare off an industry that has promised to create tens of thousands of new jobs.

The state needs to be “careful we are not killing the goose that’s laying the golden egg,” said Sen. Mary Jo White, R-Venango.

Hanger agreed that regulations need to be streamlined and said his agency is working on it, but added that most applications are processed within 45 days.

“There has to be a smart way to protect what we need to protect, and at the same time (prevent) a delay that really serves no purpose,” he said. “I believe there’s a learning curve here for everyone involved.” …

Part of the problem may be a lack of DEP manpower to cope with a record number of natural gas applications. The agency is on track to issue 8,000 permits in 2008, up from 2,000 in 1999, yet staffing in the agency’s oil and gas division has remained stable at about 80. The DEP has proposed to raise fees on drilling companies to pay for additional staff to process applications and inspect wells.

Of course, we know that however few workers the PA DEP has, New York’s DEC has far fewer. So it stands to reason that here we’ll have a worse problem in this respect.