On Thursday, while resounding a call for a "state severance tax", Governor Ed Rendell shared that higher-than-expected-bids for the natural gas drilling project, to be undertaken on state forest land, is bound to come in handy in order to cut revenue shortfalls in the state's budget.

From leasing drilling rights on about 32,000 acres of forest area in north-central area of the state, Pennsylvania is expected to bag about $128 Million in revenue, and the figures are based on the high bids that were sent in earlier during the week by as many as 5 major companies.

The bid that will win the project is expected to now generate two times the revenue that was previously being estimated when state officials had prepared the leases, with the aim to generate some revenue which would help balance the 2009-10 budget, as was recently confirmed by the Governor.

"Now we can walk into next year with $68 million in unanticipated oil and gas revenues", Mr. Rendell said.

Also, the Governor has stressed that successful bidding which has come at an average per-acre bid of $4,100 is one of the various signs hinting that the natural gas market is healthy enough to go ahead and pursue exploration of deeper gas pockets in the areas of Marcellus Shale formation, and start paying the severance tax on the gas produced starting July 1.