Diversified Energy Company and the future of fracking in Pennsylvania

Pennsylvanians involved in the fracking industry remain confident that their sector will persist, regardless of the outcome of the upcoming presidential election. Both major candidates—Republican Donald Trump and Democrat Kamala Harris—are promising support for the hydraulic fracturing industry, particularly as they target voters in the gas-rich battleground state. However, while both parties have expressed backing for fracking, Trump’s consistent and vocal support contrasts with Harris’s previous opposition. This has led many residents of Washington County, a predominantly rural Republican area, to see Trump as the better option for their industry.

Jennifer McIntyre, a 47-year-old sales and operations representative for Keystone Clearwater Solutions, which provides water transfer services for fracking, has mixed feelings. She admires Trump but finds his approach contentious. Yet, she remains convinced that he is “incredibly pro-oil and gas,” unlike Democrats, who she believes have introduced regulations that complicate success for the industry. Speaking from her company’s office in the Southpointe business park, which houses many fracking-related businesses, McIntyre highlighted how she feels some of these regulations are not always appropriate.

Pennsylvania’s adoption of advanced fracking techniques in the early 2000s led to a boom in natural gas extraction, pushing the state’s production levels above those of countries like Canada and Qatar. Today, more than 2,000 unconventional gas wells are active in Washington County alone, and nearly 13,000 are spread across the state. At one of Diversified Energy’s locations in South Franklin Township, southwestern Pennsylvania, seven wells—around ten years old—steadily extract gas from the Marcellus Shale. This extracted gas is then cleaned and fed into a nearby pipeline, bringing in profits for Diversified Energy, royalties for landowners, and revenues for local and state governments.

The seven wells at the South Franklin Township site produce over four million cubic feet of natural gas daily, according to Jason John Mounts, Diversified’s director of operations for southern Pennsylvania. During a tour of the site, Mounts mentioned that he supports “whoever is going to be driving our business” in the upcoming 2024 election, adding that the political landscape tends to resolve itself every four years. Unlike some larger players in the industry, Diversified Energy does not handle the initial fracking—a complex process involving the high-pressure injection of water, sand, and chemicals underground to release trapped gas. Instead, they acquire operating wells from other companies and optimise them for better efficiency. The company’s existing wells are expected to keep producing for another 50 to 75 years on average, as noted by Douglas Kris, the vice president of investor relations at Diversified.

Despite these successes, the fracking industry has faced global criticism due to its environmental and health impacts. Many scientists, environmentalists, and public health experts have called for an outright ban on fracking, pointing to both the immediate risks of the fracking process and the broader environmental damage caused by the continued use of fossil fuels. In response, numerous governments in Europe—including those in France and Germany—have banned or suspended fracking activities. Similarly, certain provinces in Canada and US states like New York have also imposed bans.

Nevertheless, support for fracking within Pennsylvania has grown over the past decade. A 2022 poll by the Muhlenberg College Institute of Public Opinion found that 48 percent of Pennsylvanians supported fracking, with 86 percent believing it benefits the economy. Fracking’s economic impact on the state has been substantial; in 2022, it supported over 120,000 jobs, with average annual salaries around $97,000. These jobs span a wide range, as highlighted by David Callahan, president of the Marcellus Shale Coalition. Fracking not only provides numerous blue-collar roles but also many white-collar opportunities.

Diversified Energy Company exemplifies the complex balance between economic benefits and environmental challenges that defines Pennsylvania’s fracking industry. The ongoing political debate around fracking, alongside public support and environmental concerns, underscores the competing priorities that will continue to shape the industry’s future for decades to come.

Diversified Energy Company plc (LON:DEC) is an independent energy company engaged in the production, marketing, transportation and retirement of primarily natural gas and natural gas liquids related to its U.S. onshore upstream and midstream assets.

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