By DANIEL GILBERT and RUSSELL GOLD
States hoping to capitalize on their energy booms are running into resistance from local officials who want to be able to police the noise and industrialization that accompany oil-and-gas drilling.
The municipalities are fighting laws that bar them from regulating drilling, enacted by state lawmakers who feared towns would stunt job-creation and a stream of tax revenue.
Getty ImagesCabot Oil & Gas workers develop a fracking site in South Montrose, Pa.
Last Thursday, seven towns collectively sued Pennsylvania in state court to overturn a law passed in February that prevents them from using their zoning authority to regulate oil-and-gas development. The day before, an Ohio state senator introduced legislation to grant local officials more control over where companies can drill.
Also late last week, an energy company and a landowner appealed rulings in New York state courts that towns can use their zoning power to ban gas-drilling, despite a state law that prevents them from regulating the industry. The state has temporarily blocked companies from drilling in the Marcellus Shale while regulators weigh the environmental impact.
The balance between local land-use regulation and energy development has been hard to strike in Pennsylvania, which is carved up into more than 1,000 townships, some of which worry about how drilling would affect traffic, property values and public health.
The new state law is an “unacceptable, special-interest power grab,” said Jonathan Kamin, solicitor for one of the municipalities suing the state, the township of South Fayette, which is near Pittsburgh in the state’s southwest corner.
The 117-page lawsuit charges that Pennsylvania has overstepped its constitutional powers by foisting a uniform standard on all localities, upending existing ordinances and development plans.
A spokesman for Pennsylvania Gov. Tom Corbett said the governor hadn’t seen the lawsuit but that the administration “worked closely with local government associations” in crafting the law, and was confident it would survive the challenge.
America’s Natural Gas Alliance, an industry group, favors statewide rules. Many local governments “want to change the rules under which we operate after we’ve made investments, and that makes for a difficult situation,” spokesman Dan Whitten said.
The tension in these states stands in contrast to Texas, where local officials have the longest experience with drilling into shale formations and have created some of the strictest rules in the U.S. Fort Worth issued the first municipal ordinances governing gas drilling inside city limits in 2002, including a requirement that wells can’t be closer than 600 feet to homes, a standard that has been widely adopted in Texas.
Most Texas localities have adopted ordinances to minimize disturbances and protect homeowners, not to ban drilling. They require sound barriers and limit hours of drilling. A handful of communities in North Texas require companies to take water samples before drilling, disclose all of the chemicals used in hydraulic fracturing and even do air-quality testing.
Ron Robertson, the part-time mayor of Bartonville, north of Fort Worth, said modifications to the town’s ordinance last October were designed to “hold the fracking company responsible” if something went wrong. “We are a rural ranch community, and the majority of our citizens are leaseholders,” he said.
Other towns have gone further. Southlake, Texas, decided last year to keep its 1,000-foot buffer rule, first adopted in 2008. That led Chesapeake Energy Corp. CHK -1.80% and Exxon Mobil Corp., XOM -0.87% the nation’s two largest natural-gas producers, to abandon plans to drill there. Chesapeake, in a November letter to residents whose mineral rights it had leased, called the rules “unnecessary and restrictive.”
State officials in Ohio and Pennsylvania are eager to avoid similar situations. As Pennsylvania lawmakers were hashing out an oil-and-gas law in November, Mr. Corbett, the Republican governor, emphasized the need to match Ohio’s law, which stripped away local governments’ authority to regulate the industry.
“As they continue to attempt to lure Pennsylvania jobs and investment across our western border into Ohio, they most often point to the predictability in standards and rules,” he wrote to a state senator in a letter reviewed by The Wall Street Journal.
Ohio’s law has fueled anxiety among some local governments as companies ramp up drilling in the Utica Shale there. Last week, state Sen. Capri Cafaro, a Democrat who represents northeastern Ohio, introduced legislation to rescind the exclusive authority of state officials to regulate oil and gas, and to require drillers to comply with local zoning rules.
Rick Simmers, who heads the state’s oil-and-gas division, said Ohio’s safety standards are among the strictest in the U.S. He said his staff considers the input of local officials when issuing a drilling permit, but pays little heed to their preferences about where companies can drill.
“Oil and gas is where it is,” he said.
Write to Russell Gold at russell.gold@wsj.com
read more: http://online.wsj.com/article/SB10001424052702304750404577319960306479218.html?mod=googlenews_wsj
Energy Independence For States 