Missing the Forest for the Trees: Balancing Shale Exploration and Conservation Goals Through Policy

Abstract

Unconventional shale gas activity has presented both challenges and opportunities for conservation. The unique nature of horizontal drilling used in shale exploration allows for a reduction in the footprint of shale related activity in the landscape. However, the existing policies regulating shale activity across the Northeast, particularly in Pennsylvania, largely miss an opportunity to encourage such consolidation, which would result in substantial ecosystem conservation. Using satellite land cover data for the years 2006 and 2011 combined with data on shale drilling activity in Pennsylvania, we show that a consolidation of wells to underutilized well pads would have resulted in a forest conservation gain of over 112,838 acres between 2006 and 2015. While likely an overestimate, this suggests that small changes in policy such as a moving towards a quantity based market mechanism to regulate the number of well pads would result in substantial conservation gains.

Keywords: economic policy, forest conservation, fragmentation, shale exploration, permits

JEL Classification: Q23, Q38, Q42