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Rex Energy Suspends Operations Near Pennsylvania School

Rex Energy Corp. has notified a group of its lessors in western Pennsylvania that it has been forced to suspend operations at a five-well pad while it awaits the outcome of a zoning appeal filed by two environmental groups and residents in Butler County that want drilling halted near a school.

In October, the Clean Air Council and the Delaware Riverkeeper Network, along with four residents of Middlesex, PA, filed a challenge against the township's zoning board for modifying an ordinance that allows oil and gas companies to drill in residential-agricultural zones (see Shale DailyOct. 13). The group contends that the modification facilitated Rex's plans to drill within two-thirds of a mile of the Mars Area School District property, where more than 3,200 students in grades K-12 attend school.

The area in question, about 25 miles north of Pittsburgh, is part of an area that comprises the bulk of Rex's leasehold. The company had already started to develop the land, but after the zoning appeal, it was forced to suspend operations. A hearing is scheduled on Tuesday (Nov. 18) before the township's zoning board that may resolve the matter.

"If the ordinance is upheld by the zoning hearing board, Rex has the right to recommence development of these well pads, pending any subsequent appellate challenge by the objectors," the company’s letter stated. "If, however, the ordinance is held to be invalid, then continued development of the well pads will be postponed indefinitely until any appeal is exhausted."

The company had planned to drill five Marcellus Shale wells at the Geyer pad into three different drilling units. The requirement that Rex suspend operations pending the appeal comes after months of opposition from the Mars Parent Group, which was formed earlier this year to research horizontal drilling using hydraulic fracturing and to resist Rex's development plans for fear of students’ health and safety (see Shale DailySept. 18).

The opposition has also filed an appeal with the state Environmental Hearing Board challenging the horizontal drilling permits issued in September by the Pennsylvania Department of Environmental Protection (DEP).

"These actions have caused Rex to cease operations on the well pad," the company stated. "At this time, the duration of the delay in operations is not known. The uncertainty of the regulatory environment and pending outcome of these recent developments leaves Rex's operations in an indeterminate state."

When the state issued Rex drilling permits for the project, the parent group protested, prompting a letter from the DEP that said the agency had no legal right to deny the company permits for the site.

Rex spokesman Patrick Creighton said the company is committed to moving forward with the project and cooperating with all parties. No date has been set for a hearing before the state environmental board.

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