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Conflicts over control of drilling play out around U.S. - Pittsburgh Post-Gazette

Conflicts over control of drilling play out around U.S.

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On one side was a town saying it alone knew its community well enough to say where industrial operations could or couldn't go. On the other side was a gas driller saying unpredictable local regulations would impede business that needs consistency for careful planning.

Sound familiar?

The scene played out in New York's second-highest court last week, as the small community of Dryden defended its ban on gas drilling operations against Norse Energy, which sued after town supervisors passed the ban as part of a local zoning code in 2011.

Oral arguments Thursday provide a bit of deja vu for followers of a similar Pennsylvania court case. The unlocking of shale gas reserves across the country has also unlocked a series of lawsuits about who can regulate such development. A similar situation is taking place in Longmont, Colo., where an activist used Pittsburgh's drilling ban as a model for his town's rules and has run into opposition from an industry group.

New Yorkers, meanwhile, are keeping a close eye on the outcome of the Dryden case, which could inspire similar ordinances or outlaw them altogether. The result also could influence Gov. Andrew Cuomo's decision to maintain a statewide ban on drilling, which has kept Pennsylvania drillers from crossing the Keystone state's northern border to lease land and search for more reserves.

PG graphic: Dryden, N.Y.
(Click image for larger version)

The conflict outlined in that case is the same one being considered by the state Supreme Court in Pennsylvania, where residents await a decision on whether state drilling guidelines supercede local control.

Communities across Appalachia's Marcellus Shale region have drafted their own regulations, imposing mandatory setbacks for wells near schools or hospitals, for instance, or requiring noise barriers on all drilling sites. Pennsylvania Gov. Tom Corbett's Act 13 legislation passed in 2012 imposed a one-size-fits-all set of regulations that was challenged by a group of municipalities.

Last July, the state Commonwealth Court ruled in favor of the municipalities. That was appealed and a decision is expected any day from the state Supreme Court, which heard arguments in October.

Pennsylvania's decision won't set precedent across the nation -- state decisions don't cross borders like U.S. Supreme Court rulings.

But it could be instructive for other state courts, Mr. Smith said. It's happened here before. When the Pennsylvania Supreme Court justices found in 2009 that state guidelines don't necessarily supercede local regulations, they cited a Colorado court's decision.

The use of hydraulic fracturing technology has allowed companies to tap energy reserves that were once inaccessible, and brought drilling controversy to regions not used to such industrial activity, said Shaun Goho, an instructor at Harvard Law School specializing in environmental law.

States have traditionally been charged with regulating major industry, while local communities draft laws to preserve the character of a town, Mr. Goho said. Shale operations implicate both missions.

Pennsylvania's ruling could be useful in taking similar cases before a judge in shale-drilling states, lead attorney John Smith said, since this is "a case of first impression."

"We are hearing from a lot of people in New York," said Mr. Smith, who works at the Canonsburg firm Smith Butz.

The calls come from reporters looking for legal tea leaves and medical personnel who are concerned about drilling activity near certain populations, he said.

As in Pennsylvania's court battle, the Dryden case has been years in the making, with scenes familiar to many here: full auditoriums and long lines at the microphone during supervisor meetings; candidates running for local office on platforms built entirely around their drilling stance; an anti-drilling organization circulating petitions; and a pro-drilling group defending property rights.

"It was the issue," said James Gustafson, chairman of the Democratic Committee in Dryden.

The town was sued shortly after the ban was unanimously passed by the supervisors in 2011.

"We have an operating budget of about $5 million, so being sued by a multibillion-dollar energy company was pretty intimidating," supervisor Mary Ann Sumner said.

The Dryden case has been picked up pro bono by the environmental advocacy organization Earthjustice, whose attorney Deborah Goldberg said Thursday that the town is "exercising its constitutionally protected legal power to regulate land use through zoning."

Drilling advocates dispute that claim, saying existing state oil and gas law protected landowners' mineral rights.

"When a municipality says you can't drill here, you have the ultimate waste of the resource and destruction of the correlative rights of the landowners," said Tom West, the attorney representing Norse Energy, which is based in Oslo, Norway.

A decision is expected in New York within two months, but the case could go all the way to the state's highest court, the Court of Appeals.

But even if the industry wins, Dryden residents shouldn't expect rigs to arrive quickly. Earlier this month, New York lawmakers voted to extend the state's 5-year-old moratorium on gas drilling to 2015.

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The Associated Press contributed to this report. Erich Schwartzel: eschwartzel@post-gazette.com or 412-263-1455.


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