Albany, N.Y.—Vineyards need clean water for growing grapes, wineries need it for making good wine, and tourists are attracted to wine regions with beautiful vistas of lakes, streams and vineyards. In the past year, winemakers and grapegrowers in New York’s Finger Lakes wine region have become increasingly aware that their water supply may be threatened by the impact of the natural gas-drilling process called high-volume hydraulic fracturing, or fracking. 

Although it was known that Gov. David Paterson supported drilling for its economic benefits in a state with many fiscal problems, legislation was introduced in the New York State Assembly that was intended to limit natural gas development using the fracking process until additional studies could be conducted to determine the impacts of the drilling. The legislation, which placed a moratorium on new permits for gas drilling using hydraulic fracturing until May 15, 2011, was passed on Nov. 29.

On Dec. 11, Gov. Paterson vetoed that legislation, and instead issued an executive order that instituted a moratorium until July 1, 2011—six weeks beyond the date specified by the legislation—but more narrowly defining the types of drilling to be restricted. The order restricts the issuing of permits for high-volume, horizontal hydraulic fracturing, but exempts vertical wells.

The Finger Lakes are on the northern side of a multi-state-sized black shale formation known as the Marcellus Shale, which extends from West Virginia to the northeast through Pennsylvania and into southern New York. This shale may contain 168 trillion to 516 trillion cubic feet of natural gas, according to estimates by geologists.

The gas is not accessible by traditional vertical wells, but can be extracted by drilling a vertical well to a depth just above the rock formation containing the gas and then drilling horizontally through the gas-bearing rock. In the fracking process, between 3 and 4 million gallons of water mixed with sand and chemicals are forced down the well to fracture the shale and release the gas.

While environmental groups welcomed the longer moratorium period, there is concern about potential loopholes for gas drilling companies. Craig Michaels, the watershed program director for the environmental group Riverkeeper, stated that the environmental community would be “watching closely to assure that industry does not side-step environmental review by conducting an onslaught of vertical drilling and then converting those vertical wells to horizontal wells.”

Art Hunt, owner of 12,000-case Hunt Country Vineyards  in Branchport, N.Y., and chairman of the Marcellus Shale Committee of the Keuka Lake Association, told Wines & Vines that he understands lame-duck Gov. Paterson didn’t want to halt all drilling. However, governor-elect Andrew Cuomo takes office in January, and the executive order issued by Paterson is effective only as long as Cuomo decides to go along with it.

Hunt also pointed out that the Minerals Department of the Department of Environmental Conservation is currently understaffed and, with state budgeting cuts, may not have sufficient staff on hand to inspect gas-drilling sites for possible violations by the drilling companies.

Widespread waffling Paterson’s veto of the fracking legislation came just two days after the Delaware River Basin Commission (DRBC), released proposed regulations revising their previously proposed tough regulations on drilling in the Marcellus Shale. The DRBC, a regional regulatory agency charged with overseeing the Delaware River watershed in New York, New Jersey, Pennsylvania and Delaware, had proposed that companies drilling in the Marcellus Shale post a $5 million bond for each well to cover the potential costs of pollution and restoration. The amount of financial assurance was cut back to $125,000 for each well. While this seems like a steep drop, the $125,000 bond is nevertheless five times higher than that required by Pennsylvania state regulations.

The regulations proposed by the DRBC had been supported by the governors of Pennsylvania, New Jersey and Delaware, but were opposed by Paterson. The commission plans to hold three public hearings on the regulations during the required 90-day public comment period. The dates and locations for the hearings have not yet been released by the DRBC.

Drilling opponents are unhappy with the regulations, which they view as too lenient, and with the DRBC for not waiting for a full impact study to be completed. For example, the U.S. Environmental Protection Agency is conducting a study of hydraulic fracking and its possible effects on ground water that is scheduled to be completed in 2012. The gas-drilling companies view the regulations as too strict, and an impediment to their opening of new wells in the Delaware River region.