ERIE – A Western Pennsylvania energy provider is suing an Indiana County municipality in federal court for the second time, in order to reverse its law banning shale gas drilling waste injection wells.
Pennsylvania General Energy Company (PGE) of Warren filed suit in the U.S. District Court for the Western District of Pennsylvania on Dec. 9 versus Grant Township of Indiana County and the Grant Township Board of Supervisors, of Marion Center.
In June 2014, Grant Township stopped being a Second Class Township under state law and adopted a Community Bill of Rights Ordinance (CBORO) that prohibited corporations from depositing waste from oil and gas extraction in the township, in order to prevent plaintiff PGE from operating an injection well there.
Grant Township became a home rule municipality organized under the Home Rule Charter and Optional Plans Law, which, on Nov. 3, 2015, formally chose to operate as a Home Rule municipality.
“After PGE challenged the CBORO in this Court, U.S. District Court Judge Susan Paradise Baxter ruled on Oct. 14, 2015, that numerous provisions of the CBORO were invalid, pre-empted and unlawfully exclusionary under state law. The month after Judge Baxter’s decision was entered, the residents of the township elected to become a Home Rule municipality with a governing Home Rule Charter (HRC) that contained the same provisions that were invalidated by Judge Baxter,” the suit says.
“On March 31, 2017, Judge Baxter ruled that multiple provisions of the CBORO violated the United States Constitution. Despite the rulings of Judge Baxter, Grant Township has continued to claim that its HRC is valid and enforceable.”
Meanwhile, Pennsylvania General Energy contends that the HRC “prevents PGE from operating or selling its injection well and exposes PGE to criminal penalties, civil actions, loss of property rights, and liability.”
The well in question is the Yanity Farm Well, put into production in 1997 and located in Grant Township. In 2012, PGE entered into a lease with Yanity Farm for the purpose of “injecting and disposing of tophole water, production brine, and stimulation flowback fluids associated with oil and natural gas exploration and production into the Huntersville and Oriskany formations.”
Afterwards, Grant Township passed the CBORO in 2014 and HRC in 2015.
The HRC includes language “recognizing the rights of local ecosystems” and was democratically adopted by over 70 percent of Grant Township voters five years ago.
Grant Township and other municipalities argue that injection wells threaten drinking water, cause earthquakes and have been shut down in states such as California and Ohio.
In March, a judge rescinded a Department of Environmental Protection permit issued to PGE for the Yanity Well, causing the company to attempt to unload it.
“PGE has attempted to sell the Yanity Well for disposal of produced fluids from gas development operations, but has been unable to do so based on the existence of the HRC,” the suit says.
“As a direct and proximate cause of Grant Township’s adoption of the HRC, PGE has been precluded from operating the Yanity Well for legally permissible injection purposes. Most recently, in November 2020, Grant Township relied on the HRC in part to order PGE to stop hauling oil and gas well drilling equipment on Township roadways despite the existence of a valid highway permit to do so.”
Grant Township government officials feel differently.
“So here we go again. PGE throwing another lawsuit at us to try to bring us to heel, when our community has overwhelmingly said ‘Hell No’ multiple times. PGE tried but couldn’t sell this well during this time of economic ruin, and so instead, has delivered our community a Christmas present that blames our valid local law for its problems and is suing us again,” Jon Perry, Chairman of the Grant Township Board of Supervisors, said.
PGE disagrees.
“The HRC causes real and concrete harm to PGE by depriving PGE of its rights as guaranteed by the United States Constitution,” the suit says.
For 11 counts of constitutional rights violations consisting of substantive and procedural due process violations, a contract clause violation, impermissible exercise of power under Home Rule Charter and Optional Plans Law, pre-emption by the Pennsylvania Oil and Gas Act, exclusion by the Home Rule Charter, pre-emption by the Pennsylvania Limited Liability Company Law and it being an unconstitutional and unenforceable ordinance, the plaintiff is seeking judgment declaring that the home rule charter is void and unenforceable in its entirety due to being violative of the U.S. Constitution in numerous ways, all fees and costs incurred in this action and such other relief as this Court shall deem just and equitable under the circumstances.
The plaintiff is represented by Lisa C. McManus of Pennsylvania General Energy Company, in Warren.
The defendants have not yet obtained legal counsel.
U.S. District Court for the Western District of Pennsylvania case 1:20-cv-00351
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nick.malfitano@therecordinc.com