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The Impact of Oil and Natural Gas Facilities on Rural Residential Property

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  • Peter C. Boxall, Wing H. Chan, and Melville L. McMillan

    ()
    (Wilfrid Laurier University)

Abstract

This paper examines the impact of oil and gas facilities on rural residential property values using data from central Alberta, Canada. The influences are evaluated using two groups of variables characterizing hazard effects and amenity effects. A spatial error model was employed to capture the spatial dependence between neighbouring properties. The results show that property values are negatively correlated with the number of sour gas wells and flaring oil batteries within 4km of the property. Indices reflecting potential health hazards associated with rates of H2 S release (based on information from Emergency Response Plans and Zones) also have a significant negative association with property prices. The findings suggest that oil and sour gas facilities located within 4 km of rural residential properties significantly affect their sale price.

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File URL: http://www.wlu.ca/documents/6444/2005-01EC.pdf
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Bibliographic Info

Paper provided by Wilfrid Laurier University, Department of Economics in its series Working Papers with number eg0039.

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Length: 38
Date of creation: 2005
Date of revision: 2005
Handle: RePEc:wlu:wpaper:eg0039

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Related research

Keywords: sour gas; hedonic prices; property value impacts;

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References

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  14. Kathleen P. Bell & Nancy E. Bockstael, 2000. "Applying the Generalized-Moments Estimation Approach to Spatial Problems Involving Microlevel Data," The Review of Economics and Statistics, MIT Press, vol. 82(1), pages 72-82, February.
  15. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
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Cited by:
  1. Claudio Agostini & Gastón Palmucci, 2006. "Capitalización Heterogénea de un Bien Semipúblico: El Metro de Santiago," ILADES-Georgetown University Working Papers inv175, Ilades-Georgetown University, Universidad Alberto Hurtado/School of Economics and Bussines.
  2. Gildas Appéré & Morgane Chevé & Emmanuel Bonnet & Muriel Travers, 2009. "Perception des risques industriels dans une zone estuarienne : une analyse hédoniste spatiale," Économie et Prévision, Programme National Persée, vol. 190(4), pages 135-158.
  3. Bell, Kathleen P. & Dalton, Timothy J., 2006. "Spatial Economic Analysis in Data-Rich Environments," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25241, International Association of Agricultural Economists.

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