Shale Daily / NGI All News Access

West Virginia City Might Take Driller to Court

Officials with the City of Morgantown, WV, said the city might take Northeast Natural Energy (NNE) to court if the city passes an ordinance banning hydraulic fracturing (hydrofracking) and the company subsequently starts using the practice at two Marcellus Shale gas wells.

The ordinance -- which would ban hydrofracking within the city limits and inside a one-mile buffer around the city -- passed a first reading muster by the city council on Tuesday by 6-1. A public hearing and a second vote on the measure is scheduled for June 21.

"If fracking has not occurred by the time this passes, we would expect the company to obey and not frack," Morgantown Mayor William Byrne told NGI's Shale Daily on Tuesday. "That doesn't mean they can't drill. They can vertically drill to obtain oil and gas in a more conventional way. Our intent is to prohibit fracking from the date of passage."

Byrne, an attorney with the law firm Byrne Hedges & Lyons, conceded that NNE's permit through the West Virginia Department of Environmental Protection (DEP) allowed the Charleston, WV-based company to perform hydrofracking at its two wells in the city's industrial park, "but there would be a conflict. I feel certain that type of issue is most likely going to get resolved in a judicial setting."

Asked if that meant the city intended to take NNE to court, Byrne said he didn't want to discuss the city's legal strategies in the press. However, he agreed that taking the company to court was "absolutely" an option.

"There has been general concern by a number of people in our community about hydraulic fracturing in the Marcellus Shale," Byrne said. "We have repeatedly had people come before us asking us to do this and that. We recognize the importance of the extraction of this natural resource. We think it's a great opportunity for the state and the people. However, we believe that the regulatory structure in place is inadequate to deal with all of the potential consequences of this relatively new endeavor for our area."

Councilman Charlie Byrer -- who has an energy industry background and was the lone dissenting vote on the ordinance -- said many citizens came to Tuesday's meeting to voice concerns about the potential contamination of the city's drinking water.

"With the record of the industry, and the professionalism that they have, they're going to take every safeguard possible to protect water supplies, whether it's groundwater or from the [Monongahela] river," Byrer said. "A lot of it is fear factor. There are a lot of unknowns out there that the general public is concerned about. It's going to be an education process."

The city council also passed two resolutions, the first of which urges Gov. Earl Ray Tomblin to convene a special session of the West Virginia Legislature and update the state's laws on permitting and hydrofracking. The second asks the DEP to issue a stop-work order for the two NNE wells. DEP Secretary Randy Huffman has said it was unlikely the department would honor that request (see Shale Daily, June 6).

Addressing Huffman's comments, Byrne said, "It's a resolution, a request, a suggestion. If the DEP issued the permit then they are letting them do it. I don't believe that a resolution from our city council is going to make them stop. But it is an expression of our concern and our desire to see that particular endeavor not be fracked."

Byrer said he voted in favor of convening the legislature but not for a stop-work order.

"I was concerned that we were getting into individuals' ownership of mineral rights [with the stop-work order]," Byrer said. "I think we're infringing upon people who might want to develop that resource or sell their property sometime and there's no opportunity there for development. But we've got an opportunity here to elevate a lot of these concerns to the state legislature. They really dropped the ball this past session when they didn't do anything as far as updating the drilling permitting regulations for Marcellus Shale."

Byrer said he also voted against the stop-work order because the DEP amended NNE's two well permits on May 19, after the company had negotiated with the city's utility board to include closed-loop drilling systems for both the air-drilled and fluid-drilled portions of wells (see Shale Daily, May 25).

"I thought what the company agreed to do was really sufficient," Byrer said. "I thought the stop-work order undermined the agreement that we just voted on and endorsed two weeks ago."

Byrne also took issue with the state legislature.

"We continue to believe that the siting of that well, right above our water supply and right in the face of hundreds of millions of dollars of economic development on our side of the river, was simply inappropriate," Byrne said. "The regulatory structure for providing input about the siting of these things is either nonexistent or inadequate. We didn't even know it was happening. We felt compelled to take some action to stem this tide until such time as the legislature can put in place a set of comprehensive regulations that we feel would protect our health, welfare and safety."

Byrne said he believed drilling was being performed at the wells, but not hydrofracking.

The state of West Virginia received 622 new Marcellus drilling permit applications within the last year, according to the DEP. Consol Energy Inc. led all companies by seeking 110 permits, followed by Chesapeake Energy Corp. with 82 and EQT Production with 74. NNE had four permit requests.

Byrer said other municipalities have either enacted or were considering legislation banning hydrofracking because of similar concerns. But he predicted that if there was a court fight, the municipalities -- including Morgantown -- would lose.

"The state legislature has to address the concerns of the municipalities," Byrer said. "You're going to have 50 to 60 municipalities up against the same situation: drilling within the city limits or near a water supply. I don't think anybody is going to stop Northeast, it's going to be grandfathered in. My concern is down the road. The city owns several hundred acres of coal and gas rights here that we could [use] to supplement or offset our energy costs or even promote small industry coming in here by offering low cost energy.

"I just see us shooting ourselves in the foot here."

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