American Oil and Gas Reporter - March 2018 - 86

ConventionSection: Pennsylvania Independent Oil & Gas Association

'Community Rights' Drive Hits Setback
HARRISBURG, PA.-A federal judge
in Pennsylvania not only has derailed one
legal battle in a multistate effort to expand
local municipal authority over oil and gas
activities, but also has ordered two of the
attorneys to pay $52,000 in sanctions for
what he terms a frivolous lawsuit.
The Community Environmental Legal
Defense Fund (CELDF) is a Pennsylvania-based group that has spawned lawsuits
in several states that challenge the "community bill of rights" ordinance and home
rule charters it has written that assert the
legal power to deny corporations rights
granted to them by the U.S. Constitution.
Kevin Moody, vice president and general counsel for the Pennsylvania Independent Oil & Gas Association, says
CELDF's local laws also asserts ecosystems have personal rights, and that people
have an inalienable constitutional right
of local self-government that enables
them to decide which federal or state
laws apply in their communities.
The sanction against CELDF's legal
team came in a federal lawsuit involving
Pennsylvania General Energy Co. and Grant
Township. In 2012, PGE sought a permit
for an injection well in the Indiana County,
Pa., community to handle 30,000 barrels
of water a month for 10 years. Local officials
moved to block the project, arguing it would
threaten local water sources.
Relying on CELDF's legal advice,
Grant Township proposed to ban oil and
gas disposal wells. PIOGA intervened to
support the company in the legal action
(AOGR, Feb. 2018, pg. 18).
Court documents say that, in addition
to finding CEDLF's legal arguments contrary to settled law and thus frivolous,
the group's attempt to represent the ecosystem violated federal rules.
PIOGA notes CELDF has helped more
than 200 municipal and local governments
enact "community rights" local laws, arguing
that they trump state and federal laws, and
permits. In Grant Township's case, the supervisors argued the people's right of local
self-government; rights to clean air, water
and soil; and the rights of the ecosystem
were superior to those of corporations.
"These actions by local municipalities
or environmental nongovernmental organizations continue to plague the oil
and gas industry," reflects PIOGA Chairman Gary Slagel. "It may be true more
so in Pennsylvania than in other states,
86 THE AMERICAN OIL & GAS REPORTER

simply because of municipalities' governance capabilities. While the furor seems
to have died as it relates to drilling activity,
midstream and pipeline activity protests
seem to be picking up."
Slagel says he hopes midstream companies continue to invest in projects, noting
that isolated incidents involving drilling
fluid leaks during pipeline installation
under streams have aroused local governments' desire to expand their supervisory
powers. "It would be helpful if we could
balance municipality and commonwealth
authority, but I am not sure that is likely
to happen any time in the near future," he
muses. "The idea that Pennsylvania has
this local self-governance capability is so
strongly felt in the commonwealth after
the Robinson Township and PEDF court
decisions that I don't know if we ever will
be able to fully change it."
Moody predicts the CELDF attorneys
will appeal the $52,000 punishment, noting
that PGE asked for more than $500,000 to
compensate it for having to respond to the
frivolous legal arguments used to justify
these "community rights" local laws. Instead,
he says, Magistrate Judge Susan Paradise
Baxter focused on a couple of the township's
filings and opted for the smaller amount.
In addition to the financial slap, the judge
referred one of the CELDF attorneys to
the disciplinary board of the Pennsylvania
Supreme Court to determine whether attorney ethics rules were violated.
Targeting Infrastructure
Moody says there are few indications
local governments in Pennsylvania have
learned to avoid the legal problems
CELDF's movement causes. "Many communities are trying to do more all the
time to stop natural gas development,
whether through traditional zoning or the
'revolutionary' CELDF approach, which
is how CELDF describes its 'movement.'
Highland Township in Elk County is an
exception, as the newly elected supervisors
rejected CELDF's approach after the
township was sued in federal court by
Seneca Resources Corp. and lost. CELDF
is emboldened by its court loses, touting
them as proof that our system of government is rigged against its approach and
using them to raise funds," he says.
That anti-industry sentiment extends
beyond local governments and well sites,
Moody cautions, as the "keep it in the

ground" movement targets both wells and
pipelines. It has failed to stop most drilling
activity, he says, so now activists are trying
to prevent the infrastructure needed to get
oil and gas to markets. In addition to
direct legal attacks, the anti-industry forces
are pushing the Federal Energy Regulatory
Commission to change the way it evaluates
new pipelines and their routes.
Moody notes that FERC Commissioner
Robert Powelson, who joined the commission from the Pennsylvania Public
Utility Commission, has been quoted as
saying regulated entities such as pipelines
shouldn't be concerned with those calls.
"Part of the argument of the anti-pipeline
'keep it in the ground' people is that the
entire environmental assessment process
must look beyond traditional pipeline issues
to include emissions from generating electricity as well as from the natural gas production process and end use," Moody says.
PIOGA is working with other groups,
including the Pennsylvania Chamber of
Business and Industry, Marcellus Shale
Coalition, Pennsylvania Grade Crude Oil
Coalition and Pennsylvania Independent
Petroleum Producers on litigation and
lobbying efforts to counter anti-industry
activities, Moody says. He adds that operators shouldn't expect a political solution
to the expansive efforts by municipalities
to stop industry development.
"The situation has been created by recent
court decisions and involves the Pennsylvania
Constitution," he describes. "There are
limits to what can be done legislatively to
counter a Pennsylvania Supreme Court decision interpreting the Constitution because
statutes do not trump the Constitution."
PIOGA President Dan Weaver says
another infrastructure challenge facing the
industry is the Pennsylvania Department
of Environmental Protection's attempts to
block wastewater disposal in underground
injection wells, even though the agency
admits the U.S. Environmental Protection
Agency has primacy over those wells.
"PIOGA has a lot of concerns about
conventional operations, what lack of injection wells will do to costs, and what
will happen with the treatment facilities,"
he says. "The state has been trying to
impose stricter standards and practices
that many believe are not warranted by
facts or science. Because of other issues,
I think DEP is backing away. It will be
interesting to see if we get some more

American Oil and Gas Reporter - March 2018

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