UPDATE 2-Penn regulator says shale gas drilling method safe

* State finds no evidence 'fracking' contaminates water

* Says some contamination caused by above-ground spills (Adds details after second paragraph)

By Jon Hurdle

HARRISBURG, Pa., Oct 1 (Reuters) - Pennsylvania's chief environmental regulator said on Friday he saw no evidence that the shale gas drilling process known as hydraulic fracturing contaminates underground water supplies with chemicals.

"It's our experience in Pennsylvania that we have not had one case in which the fluids used to break off the gas from 5,000 to 8,000 feet (1,500-2,400 m) underground have returned to contaminate ground water," said John Hanger, secretary of the Department of Environmental Protection (DEP).

Hanger told Reuters that officials have found cases of water contamination caused by spills and leaks of drilling materials on the surface of so-called "fracking" operations during Pennsylvania's drilling boom.

There have also been cases of water contaminated by the migration of methane from gas wells, he said in an interview.

Energy companies have maintained there has been no proven water contamination from hydraulic fracturing. Hanger said perceived health risks were generally exaggerated.

"There's a lot of focus in the media and the public on the problems that we have not had," he said during an hour-long interview in his office.