A Pittsburgh suburb has denied Apex Energy LLC's request for a conditional use permit to construct a nine-well shale gas pad, saying in its decision that the company failed to prove that its operations would "not violate the environmental rights of the citizens."

Apex told locals news media that the decision was an unusual one for a zoning board, noting that the Pennsylvania Department of Environmental Protection (DEP) ultimately regulates oil and natural gas drilling in the state. The company already operates two wells in Penn Township, about 23 miles east of Pittsburgh. The move was the latest controversy over drilling there.

The township approved a permit for the company last year, but later froze the approval after a citizens group appealed its decision. Apex filed a lawsuit to begin its operations and the township allowed it to move forward. Some residents had recently testified during a zoning board hearing about their concerns for development near residential areas.

Based in Western Pennsylvania, Apex is a small company backed by Apollo Global Management LLC to pursue development in the Marcellus Shale. The township's zoning ordinance includes a provision that requires drillers to demonstrate that their operations won't violate resident's rights to clean air and pure water.

Apex said its permit application was comprehensive. It even submitted research to show the potential impacts on air and water, but the zoning board found those efforts inadequate. The company is currently considering a court challenge, but plans to first try and resolve the township's concerns.

The township's drilling ordinance essentially cites Article 1, Section 27 of the state's constitution, a rare environmental rights amendment that reads in part, "the people have a right to clean air, pure water and to the preservation of the natural scenic, historic and esthetic values of the environment." The amendment was central to the state Supreme Court's decision in 2013 that undercut the DEP's central regulatory authority by returning to municipalities their right to change or enforce local zoning laws (see Shale DailyDec 20, 2013).

Since the ruling, many municipalities have altered their zoning ordinances to accommodate shale drilling in residential-agricultural zones. That has prompted industry opponents to file lawsuits against operators claiming the zones are not compatible with shale operations (see Shale DailyDec. 1, 2014). Last September, however, a Pennsylvania appellate court upheld a conditional use permit in Lycoming County in a key ruling that found such zones are compatible with residential areas (see Shale DailySept. 15, 2015).