Industry to appeal both Middlefield, Dryden drilling bans

The drilling industry is appealing two watershed cases that will decide whether local municipalities in New York state can ban drilling.

Industry supporters will challenge rulings issued last month by the state Supreme Court that upheld local drilling bans in both the Town of Dryden and the Town of Middlefield, Tom West, an attorney from the West Law Firm, said this morning. The firm issued a notice of appeal yesterday on behalf of Anschutz Exploration Corporation in the Dryden case. The West firm is also working with attorneys from Levene Gouldin & Thompson on an appeal of the Middlefield case, expected within days, West said. The notice to appeal both cases comes just days before the deadline.

On February 21, New York State Supreme Court justice Phillip R. Rumsey issued a summary judgment in the matter of Anschutz Exploration Corporation versus Town of Dryden that upheld the town’s ban on shale gas exploration. Following the ruling in late February, West told me the company was not enthusiastic about funding an appeal in New York state for several reasons, including the low price of gas, environmental resistance, regulatory uncertainty in New York, and the status of its lease hold. He did not rule out an appeal, either.

Days after the Dryden decision, acting Supreme Court Justice Donald F. Cerio, Jr. ruled in favor of the Town of Middlefield’s ban on hydrofracking. The decision was in response to a claim by Jennifer Huntington, a dairy farmer and president of Cooperstown Holstein Corporation, that the ordinance denied her rights to reap economic benefits of a lease to develop mineral rights on 400 acres. Scott Kurkoski, of Levene Gouldin & Thompson, said in March his firm was working on Huntington’s appeal, with the expectation that a coalition representing pro-drilling landowners will chip in to help cover legal expenses. “It’s expensive, and so far Susan Huntington has taken it on by herself,” he said. “I expect landowners will step up.”

Ultimately, the outcome of the landmark case will decide whether the state or local jurisdictions have the final say on drilling. The fight by the industry to remove the bans speaks to the value of mineral resources under the towns. Prime sections of both the Marcellus and Utica shales – thought to be some of the largest natural gas reserves in the world -- extend from Pennsylvania well into upstate New York. The issue embodies the national controversy over the merit of the risks and damages of onshore drilling,

West said today that the law firms have found funding for the appeals, although he was not specific regarding the source. While notices to appeal the cases are being filed by the deadlines, the actual appeals will take longer to assemble and will come later this year, he said. The cases would likely be heard together in front of the appellate court this fall in Albany, he said.