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Natural Gas ‘Fracking’ Ban Upheld in Second New York Town

Bans on natural gas drilling in two New York towns were each upheld by state judges this week.

Middlefield, New York’s 2011 ban on gas drilling, including hydraulic fracturing, was upheld by State Supreme Court Judge Donald Cerio Jr. yesterday, according to Tom West, an attorney representing Cooperstown Holstein Corp., a dairy farm that challenged the ban. On Feb. 21, State Supreme Court Judge Phillip Rumsey said the Town of Dryden’s ban on drilling wasn’t preempted by state law.

The local bans target hydraulic fracturing for gas, a process in which chemically treated water is forced underground to break up rock and free trapped gas. Environmental groups say the process threatens drinking water supplies.

“This is really the kiss of death for drilling in New York,” West said in an interview. “No prudent operator is going to invest in leases in New York if those leases are at the mercy of a zoning ban.”

New York placed a moratorium on the drilling process known as fracking in 2010 while state regulators developed environmental rules. Since then, about 20 towns in the state have adopted laws to ban drilling, according to Karen Edelstein, a geographic information-systems consultant in Ithaca.

The Dryden ban was challenged by Denver-based Anschutz Exploration Corp., which sued in September seeking to overturn the ban on oil and gas exploration. West, who also represents Anschutz, said he expects both decisions to be appealed.

Yesterday’s ruling couldn’t be independently confirmed with the court.

Marcellus Shale

New York sits on the northern edge of the Marcellus Shale formation, which may hold enough natural gas to supply the U.S. for about seven years, according to the U.S. Energy Department. U.S. states from Wyoming to West Virginia with shale are encouraging so-called fracking even as the U.S. Environmental Protection Agency studies the effects on drinking water and may adopt nationwide regulations.

David J. Clinton, Middlefield’s town counsel, said members of the town’s board are “elated and delighted” by the decision.

“There’s a very strong belief here in upstate New York that home rule should trump in most cases and that’s what we’re seeing so far,” Clinton said in an interview. “There’s clearly going to be disappointed people. It’s a tough issue.”

Cheryl Roberts, an attorney who represented Middlefield, said the decision wasn’t a surprise after the Dryden ruling.

‘Move Somewhere Else’

“At this point, the oil and gas companies would be wise to just leave the decision where it stands,” Roberts said, referring to a possible appeal. “For communities that think fracking is something they would like to have or communities that would welcome fracking, then those companies can operate in those communities. But for others like Middlefield who have decided for good and valid reasons to ban fracking, oil companies should move somewhere else.”

In Pennsylvania, Ohio and West Virginia, drillers tapping the Marcellus Shale contributed to a boost in fracking that helped increase U.S. natural-gas supplies and cut prices 32 percent last year. A public comment period on draft regulations in New York ended Jan. 11.

Governor Andrew Cuomo, a Democrat, said Jan. 4 he would wait for state regulators to finish the guidelines before making a decision on how to proceed.

The case is Cooperstown Holstein Corp. v. Town of Middlefield, 1700930/2011, New York State Supreme Court (Cooperstown.)

To contact the reporters on this story: Jim Efstathiou Jr. in New York at jefstathiou@bloomberg.net; Chris Dolmetsch in New York at cdolmetsch@bloomberg.net

To contact the editors responsible for this story: Jon Morgan at jmorgan97@bloomberg.net; Michael Hytha at mhytha@bloomberg.net

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