Litigation

Timothy Merrill, a now-retired resident of western Pennsylvania who worked 40 years as a buyer and marketer in the natural gas industry, wrote a sterling analysis of the Act 13 decision by the PA Supreme Court a few days ago in the Pittsburgh Post-Gazette. In his article, Merrill points out the whopping error upon which Chief Justice Ron Castille (a Republican!) based his decision. Castille states in his decision he believes drilling and fracking are inherently harmful to the environment. Problem is, says Merrill, there’s 60 years of drilling and fracking history in PA that proves just the opposite (something called “evidence,” Mr. Chief Justice). Unfortunately Castille, along with the three anti-drilling Democrats on the high court, have now invented new rights that didn’t exist before–creating bad case law that will have a profound impact for years to come.

Here’s Merrill’s “what for” article that takes the disappointing Castille to the woodshed for his profound lack of judgment…
Read More “Industry Vet Points Out Error in PA Supreme Court Act 13 Ruling”

The decision in December by the Pennsylvania Supreme Court that essentially guts large portions of the Act 13 Marcellus drilling legislation that all of a sudden anti-drillers have started calling Gov. Tom Corbetts “signature legislation” (funny how they never called it that prior to the ruling in December), continues to stir controversy. Gov. Corbett’s administration has filed a motion with the court to have it reconsider parts of their decision and in the meantime has asked drillers to voluntarily obey certain provisions in the law, like drilling at least 300 feet away from certain areas (see Gov Corbett Requests Drillers Continue to Honor Act 13 Setbacks).

The Philadelphia Inquirer ran an article yesterday with more analysis of the decision and its repercussions. Interestingly, they either mistakenly, or more likely intentionally, ran a huge picture over the article of what appears to be a large crowd of protesters outside of the Philly Convention Center and identified the picture as being from a protest rally “last year.” It was not. How do we know? MDN editor Jim Willis was there–at the Shale Insight event–and there were no protests last year. There were perhaps a half dozen people standing around with signs at one point. The protest rally in the picture was from two years ago (Jim attended the Shale Insight event two years ago too)–which tells you something. The Marcellus protest movement in PA is losing steam–but it seems the Philly Inquirer editors are happy to lie to support their narrative…
Read More “Philly Inquirer Misidentifies Photo in Act 13 Article”

One of the unintended consequences of the recent PA Supreme Court ruling that struck down zoning provisions in PA’s Act 13 law is to weaken environmental protections–specially the distance away from rivers, streams, wells and other bodies of water that drillers sink a well. Act 13 provided for a minimum 300 foot “setback” from water sources, but that’s now out the window after the Court’s decision (see PA Supreme Court Rules Against State/Drillers in Act 13 Case). PA Gov. Tom Corbett yesterday issued a call/challenge/request/plea to the drilling industry to maintain the setback standard in their drilling practices. The industry, via various representative organizations like the Marcellus Shale Coalition, has already responded that indeed they will continue to honor the setback provisions–even though the high court tossed them out. Which is just more evidence of responsible people working together responsibly to safely drill for natural gas and oil in PA. Even when the courts screw it up.

Here’s Gov. Corbett’s request, and the response by the drilling industry:
Read More “Gov Corbett Requests Drillers Continue to Honor Act 13 Setbacks”

The decision of the PA Supreme Court to invalidate large portions of the 2012 Act 13 Marcellus drilling law, particularly those portions dealing with zoning, have left much of the law–perhaps the entire law–in doubt. The court’s decision was like an explosion, and we’re just now seeing the mushroom cloud but haven’t felt the fallout just yet. Did the Supremes just destroy shale drilling in PA? Is their decision really no big deal? It all depends on whom you ask.

One thing that appears to be in jeopardy is the impact fee/tax that’s already raised over $400 million in the last two years. A lot of that fee gets distributed to the places impacted by drilling, hence its name. It’s a sensible fee notwithstanding our objection that 40% of it goes to politicians to spend in non-drilling parts of the state. However, high court’s decision throws the future of the impact fee into doubt. Last week Gov. Tom Corbett’s administration asked the Supreme Court to reconsider its decision and further clarify some issues in hopes the impact fee (among other things) can be retained…
Read More “PA’s Impact Fee in Jeopardy from Supreme Court’s Act 13 Decision”

Elections–and court cases–have consequences. You tax something more, you get less of it. You regulate something more, you get less of it. When there’s less of something, prices for it go up. Fitch Ratings–one of the largest and most prestigious rating agencies in the world–has just weighed in on the ruling by the PA Supreme Court that throws out portions of the Act 13 drilling law (see PA Supreme Court Rules Against State/Drillers in Act 13 Case). According to Fitch, more local regulation of PA’s oil and gas drilling will result in less production. You don’t normally think of Fitch as being in the oil and gas production prediction game–that’s more the purview of the Energy Information Administration (EIA). However, Fitch says the recent PA ruling will almost certainly mean less production coming out of PA–a sobering observation.

Fitch’s opinion counts because investors make decisions based on it. Less gas, higher prices. It also means less tax money will flow to municipalities. Pretty simple economics and Fitch is just stating the obvious. Here’s what Fitch said earlier this week about the PA court decision…
Read More “Fitch Ratings Says PA Court Decision Translates to Less Production”

MDN reported the sad news on Friday that PA’s Supreme Court gutted big and important parts of the Act 13 legislation passed in early 2012 (see PA Supreme Court Rules Against State/Drillers in Act 13 Case). The natural, follow-on question is, what does this decision mean for drillers and landowners? The honest answer is, in the short-term, not much. Until now we have lived under existing local/municipal zoning rules while the lawsuit worked its way through the court system. We remain under a crazy quilt patchwork of different rules for different towns. The drillers have, for the most part, learned to live with it and likely will continue doing so.

As MDN pointed out on Friday, there are some towns with boards packed with anti-drillers that will make drilling so miserable in that area (cough *Robinson* cough) drillers will likely just leave them alone–meaning landowners lose out, local businesses lose out, taxpayers will certainly lose out. Everyone’s a loser. But that’s the definition of victory for anti-drillers–everyone loses. So where do we go from here?…
Read More “What Does PA Supreme Court Decision on Act 13 Mean?”