Saturday, May 07, 2011

State Pension Fund Makes Millions on Natural Gas Investments, While State Seeks to Ban Hydraulic Fracturing

Shale Gas on Fire in New York

Hypocrisy, the name is New York state.

Hydraulic fracturing for natural gas has been banned in New York since December 2010 when then Governor David Patterson signed an executive order eliminating hydraulic fracturing until the Department of Environmental Protection completes a comprehensive review. The process has come under increasing scrutiny because of alleged harmful effects on underground aquifers, the environment and public health.

With that having been said, it comes as a bit of a surprise to learn that the New York State Comptrollers Office has invested hundreds of millions of dollars from the state pension fund in natural gas and hydraulic fracturing companies.

In all over $1 billion has been invested in more than a dozen energy companies as of March 31, 2010. Included in this is $72 million in Chesapeake Energy Corporation and $145 million in Schlumberger Ltd, a company specializing in hydrofracturing and oilfield services.

It turns out to have been a pretty good investment as the fund has made over $152 million in recent years.

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