Over the objections of a citizens group opposed to gas drilling, the city of Dallas Plan Commission last Thursday voted to revisit a previous vote against special use permits (SUP) to allow Trinity East Energy LLC to drill within the city limits.

Trinity East is seeking three SUPs to allow it to perform the first gas drilling within the city (see NGI, Dec. 10, 2012). Last month, the commission voted to deny the permits, and Trinity was expected to appeal the decision to Dallas City Council. The company acquired its leases from the city five years ago for $19 million and has spent millions more developing its project, which would put elevated wells in a floodplain.

Trinity East is a unit of Keystone Exploration Ltd. that was formed to focus on the Barnett Shale. Stephen Fort, a manager and shareholder, told NGI the contention of his company’s opponents that drilling is not allowed in the floodplain is not correct.

“We’re not sure what their concern is,” Fort said. “We’ve gotten approval from the [U.S. Army] Corps of Engineers; we’ve gotten approval from the Dallas city staff. We’ve gotten approval from the parks department. We’ve worked closely with all the entities that have any say so over drilling in the floodplain, and we’ve got a green light from them. We think it’s politics.”

A task force to establish new rules for drilling in Dallas wrapped up its work months ago, but the city is said to be still months away from considering and ultimately deciding on its recommendations, which would place much stricter requirements on drillers who would operate in the city. Fort said the new rules, if enacted as outlined, would kill drilling in the city.

“If they revise the ordinance and follow all the recommendations of the task force, it will be essentially a de facto ban on drilling in Dallas,” Fort said. “Most of the things that have been proposed would make it so difficult or so expensive to drill that it will stop all drilling in Dallas. I think they will eventually [adopt the task force recommendations]. I don’t know when that will be. We filed our SUP applications over two years ago, and they’ve been sitting on them, so we don’t know how long they’re going to take.”

The anti-drilling group Downwinders at Risk last Monday emailed its members and urged them to attend Thursday’s commission meeting. Without the Plan Commission blessing, Trinity East would have a harder time getting its permits at city council, and that could stop drilling in the city, the group said. “If they can’t find [the votes], then these permits are never awarded and the last of the ‘grandfathered’ Dallas gas leases on public land are nailed shut and buried forever for lack of council support. It’s a proxy for the entire gas drilling issue with this council.”

However, on Thursday things did not go Downwinders’ way as the Plan Commission voted to reconsider its earlier decision and set a hearing for Feb. 17. Some drilling opponents in attendance chanted “shame” following the vote to reconsider; some wept, and one activist was led from the chamber, according to an online report by The Dallas Morning News.

Opponents have maintained that drilling in a floodplain violates a city ordinance, but Fort said this is not the case. “The drilling ordinance actually refers to the city ordinance…For purposes of drilling in the floodplain, it refers to the ordinance that deals with activities in the floodplain. There’s nothing in the drilling ordinance that says you can or cannot do it…

“Then if you go to the ordinance that deals with activity in the floodplain, that ordinance was designed to allow certain activities as and when they became proposed,” Fort said. “So in other words, there’s a list. It says the following things are allowed in the floodplain, and it has a list of seven or eight things in there.

“When we went to the city on this, we told them that we had two sites there, and they said, ‘not a problem.’ I’m talking about the staff, the city staff. We just need to get an amendment and add that as an acceptable use in the floodplain: drilling and production of natural gas. That was assumed all along from the day we bought our oil and gas leases that would happen.”

Fort said city staff has recommended that an amendment to the ordinance be approved to allow drilling in the floodplain. “…[W]e understand that city council is going to act on that all at the same time and approve that amendment to their ordinance to allow for drilling in the floodplain.

“There are over 2,500 wells in the floodplain in about a four-county area in and around Dallas County. So it’s not unusual; it’s very common. And in fact, drilling in a floodplain is the best place for it because it’s an area that’s not used for a lot of other things. It’s remote. It’s not near residential areas, so it’s a good use of floodplain area.”

Fort said if Trinity East’s plans are allowed to proceed, the company will place its rigs and drilling equipment in the floodplain on platforms that rise above the 100-year flood level. “It will be like a bridge,” he said, adding that the city and its residents stand to win if drilling is allowed. “What’s interesting on this case, unlike most cities, the lands that we’re trying to get drill sites on or near are owned by the city itself. So these gas reserves, which are valuable, valuable assets, belong to the taxpayers of Dallas. And they’re being denied access to those revenues.”

SUPs sought from the city by ExxonMobil Corp. unit XTO Energy had been in line ahead of Trinity East’s for consideration by the Plan Commission; however, XTO asked the commission to remove the permit applications from the Dec. 20 meeting. The company told NGI that it was delaying action on its filings but would not provide further details.

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