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NY Anti-Fracking Ruling Deals Blow To Shale Industry

Tyler Durden's picture




 

Submitted by Nick Cunningham of OilPrice.com,

A recent court ruling giving cities and towns in New York State the authority to ban hydraulic fracturing (“fracking”) represents an enormous blow to the shale gas industry, which has been hoping to expand operations into the state for several years.

New York imposed a moratorium on fracking in 2008 so it could study the environmental impact, which industry opponents say includes adverse effects on groundwater supplies and public health. Fracking involves injecting a cocktail of water, sand, and chemicals deep underground at pressure high enough to fracture shale rock so the oil or gas within can be extracted.

Governor Andrew Cuomo has been under significant pressure from the industry to lift the moratorium, but has punted on the issue -- some say to avoid making a politically controversial decision.

New York sits atop the vast Marcellus and Utica shale formations, which hold huge volumes of shale oil and gas. But due to the moratorium, the state has not seen the expansion of drilling that nearby states like Pennsylvania and Ohio have experienced.

In the past six years, towns and cities across New York have acted on their own, passing municipal bans. One, the upstate town of Dryden, was taken to court by an energy company after it prohibited fracking.

By a 5-2 vote, the New York Court of Appeals, the state’s highest court, ruled that the actions taken by local communities to restrict fracking amounted to a “reasonable exercise” of their zoning authority, particularly since high levels of drilling “would permanently alter and adversely affect the deliberately cultivated small-town character of their communities.”

The court decision could have a deflating effect on future drilling prospects in New York, even if the statewide moratorium is lifted. Although there are plenty of counties and cities that would support fracking, the patchwork of municipal bans could make drilling on a large scale difficult. Navigating the maze of municipal zoning laws could deter investment altogether.

“It’s going to have a real chilling effect on the investment in New York,” Thomas West, an attorney for Norse Energy, told Bloomberg News in an interview. “Most of the major companies are not going to see New York as open for business if they have to develop the resource around municipalities with bans.”

Brad Gill, executive director of the Independent Oil and Gas Association of New York, put in more bluntly, saying the decision is “one more nail in the coffin” for fracking in the Empire State.

A map put together by FracTracker.org shows why drillers would hesitate before pouring millions of dollars into leases and infrastructure. Over 75 towns have banned fracking, with many more considering provisions to restrict the drilling practice.

“The oil and gas industry tried to bully us into backing down, but we took our fight all the way to New York’s highest court.” Mary Ann Sumne, the Dryden, NY town supervisor, said in response to the ruling, “I hope our victory serves as an inspiration to people in Pennsylvania, Ohio, Texas, Colorado, New Mexico, Florida, North Carolina, California and elsewhere who are also trying to do what’s right for their own communities.”

Local control over fracking has cropped up as a major issue in several states across the country. The highest profile battleground is Colorado, where several cities have passed fracking bans, including Fort Collins, Longmont, and Lafayette. The oil and gas industry is fighting the bans in court, and trying to head off more bans in cities that have experienced an increase in drilling activity.

A movement to put the issue on a statewide ballot in November’s election is gaining steam. The industry has criticized the ballot push for being a stealth effort to enact an outright state ban on fracking while cloaking itself in the language of local sovereignty.

On June 30, the Colorado Supreme Court handed ballot organizers a victory with a ruling that says they can proceed with gathering signatures on petitions to put as many as six anti-fracking measures up for a vote. A deadline of August 4 has been set for the submission of signatures -- 86,105 of which are needed for each measure organizers want to see the public decide.

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Tue, 07/01/2014 - 22:00 | 4916223 Seize Mars
Seize Mars's picture

Yeah how convenient! And just when everything was going so great.

Man, you don't think that courts are...rigged, do you?

Tue, 07/01/2014 - 22:12 | 4916265 Harbanger
Harbanger's picture

These court rulings only mean they need to pay more graft.

Tue, 07/01/2014 - 22:17 | 4916292 LetThemEatRand
LetThemEatRand's picture

Indeed.  Monied interests always get their way despite the will of the People.  But you knew that already, which is why you are against the concentration of wealth in the hands of a few.

Tue, 07/01/2014 - 22:24 | 4916318 COSMOS
COSMOS's picture

I dont know guys, lot of wealthy NYers have their countryside retreats upstate and they dont want that shit in their backyard especially polluting their groundwater and wells in case  shit gets bad and they have to helicopter out of NY to the safety of the back country of the state.

Tue, 07/01/2014 - 23:10 | 4916457 Four chan
Four chan's picture

someones milkshake is going to get drank.

Wed, 07/02/2014 - 00:00 | 4916622 ironmace
ironmace's picture

You think wealthy city types and Wall Streeters are safe among the locals upstate if SHTF ?

Nope.

 

Wed, 07/02/2014 - 12:55 | 4918193 Woodyg
Woodyg's picture

Yea what could go wrong - fracking causing an earthquake next to the nuke power plant causing an accident irradiating NYC -
There is That risk -

Calculate the possible costs of that coupled w the profits and tell me fracking is worth it.
Oh yea the Profits go to a few .001% jackals and any losses are paid by We The Taxpayer.

Tue, 07/01/2014 - 22:12 | 4916268 RafterManFMJ
RafterManFMJ's picture

If they don't get to fracking, how will Europe stay warm come winter?

Tue, 07/01/2014 - 22:18 | 4916297 BobTheSlob
BobTheSlob's picture

Eat moar beenz

Tue, 07/01/2014 - 22:00 | 4916224 BKbroiler
BKbroiler's picture

Good. Ours is one of the last watersheds in the US.  Heading to the Catskills this weekeend!

Tue, 07/01/2014 - 22:09 | 4916255 Bangin7GramRocks
Bangin7GramRocks's picture

Suck a fat dick frackers!

Wed, 07/02/2014 - 09:22 | 4917375 Agstacker
Agstacker's picture

"Suck a fat dick frackers!"

 

He types on his plastic keyboard made from petroleum products, I despise hypocrites.

Tue, 07/01/2014 - 22:18 | 4916296 BobTheSlob
BobTheSlob's picture

"Ours is one of the last watersheds in the US"...that's pretty funny!

Tue, 07/01/2014 - 22:05 | 4916233 LetThemEatRand
LetThemEatRand's picture

"A recent court ruling giving cities and towns in New York State the authority to ban hydraulic fracturing..."

Ciities and towns have the ability to block corporate action?  Who knew.  I'm sure it will be appealed to a more corporate friendly third branch.

Tue, 07/01/2014 - 22:19 | 4916301 FieldingMellish
FieldingMellish's picture

State and then federal eminent domain coming to a fracking well near you.

Tue, 07/01/2014 - 23:08 | 4916419 LetThemEatRand
LetThemEatRand's picture

Private corporations always do seem to get their way.  If they need to, they bribe elected government.  But if we did away with elected government, it would stop them.   Everyone knows that no one ever had the power to use violent force before elected government could be corrupted.  I will be more free if I don't have an elected government.

Wed, 07/02/2014 - 05:29 | 4916932 SoCalBusted
SoCalBusted's picture

This is where you fucked up and where I stopped reading...

If they need to, they bribe elected government.

Yes, the government is and has been, ready, willing and able to take bribes (sometimes known as campaign contributions) to whomever comes along and whenever they come along.

There has to be a demand before there is a supply.

 

Wed, 07/02/2014 - 08:32 | 4917184 sessinpo
sessinpo's picture

LetThemEatRand    Private corporations always do seem to get their way.  If they need to, they bribe elected government.  But if we did away with elected government, it would stop them.   Everyone knows that no one ever had the power to use violent force before elected government could be corrupted.  I will be more free if I don't have an elected government.

---

Pie in the sky stuff from someone that doesn't understand human nature.

Suppose there were no elected government officials as you say. Even on the most basic level, you would have people in positions of status. Eventually, someone would have to rule. Someone would have to fight against what is perceived as wrong - hence you have government forming and it grows. Despite the fact the government repeatedly grows and becomes inefficient and corrupt, governments are created and used over and over again for thousands of years. And you haven't figured that out yet, thus you haven't figured out the solution.

Tue, 07/01/2014 - 23:20 | 4916491 TheReplacement
TheReplacement's picture

They always did.  The question has always been if they were willing to turn out and hold the ground or not.

Tue, 07/01/2014 - 22:06 | 4916237 Oldwood
Oldwood's picture

Luckily NY doesn't need the money. They have the banking industry and thank God they are not damaging the world as we know it.

Tue, 07/01/2014 - 22:16 | 4916284 willwork4food
willwork4food's picture

Upstate NY definitely needs the money, but being raised in Syracuse I am proud they told the fuckers to jump in a lake.

Tue, 07/01/2014 - 22:50 | 4916400 disabledvet
disabledvet's picture

I see you didn't stay around. Just was there today...the whole City has collapsed. Place is a hell hole. most of the industry is down South and out Rochester way anyways. Syracuse is simply dying a slow and painful death.

No industry will work in New York because the politics is so patently corrupt. (that has been true on both sides of the aisle...although this go around the left clearly is leaps and bounds ahead.) We do have great highways though. If you're in a Republican district. If you're on the left the darn bridges are literally collapsing.

I do have issues with natural gas drilling (earthquakes being one.) But it is quite remarkable how a people who have already been destroyed economically can still find it within themselves to vote "total annihilation" too.

Teslas can't get here soon enough in my book...and it was good to see Elon Musk willing to make an investment out Buffalo way. To my knowledge he has been it for the entire State going on 40 years now.

Wed, 07/02/2014 - 01:31 | 4916804 boattrash
boattrash's picture

But what's the plan? Gonna make your electricity with that clean coal? New EPA orders will jack that shit up for ya.

Tue, 07/01/2014 - 22:16 | 4916285 BobTheSlob
BobTheSlob's picture

Try a trip to the upstate some day. Take some survival gear.

Tue, 07/01/2014 - 22:25 | 4916321 Oldwood
Oldwood's picture

You mean to tell me that NYC does not share their financial empire wealth with their state?

Tue, 07/01/2014 - 22:32 | 4916343 LetThemEatRand
LetThemEatRand's picture

They're bankers and oligarchs.  They say one thing, and do another.  It's why we don't want to hand them the keys.  Who is Alan Greenspan?

Tue, 07/01/2014 - 23:09 | 4916450 disabledvet
disabledvet's picture

they fire everybody.... in New York City too. That place hasn't improved economically since the 1920's in my book. "That's why the Banks put their industry in Upstate NY." Keep it away from the corrupt politicians. Worked until 1973...then the whole shit house went up in flames.

We still had the military where I lived (thank God) so we survived the 80's...but not Bill and Hitlery Clinton...they personally wiped out an entire City up here. "And are now doing the exact same thing to the Greater New York City metropolitan area." (2008 was no boon to the financial district. which is true even today.)

luckily there is still good land and a few people willing to work it. that's all that's left here though. the farmers can't afford the taxes and stealing. it's incredible how much arable land just lies fallow. "and people wonder why prices are going through the roof for food in the City."

the gold standard for the USA came from Upstate New York for a reason. "you have to earn your money up here"...which mean avoiding the "Continentalists" at all costs. That's Bill and Hillary...and George W Bush I might add.

To W's credit he fired his first two Secretaries of the Treasury. Still wasn't enough. Believe it or not if Puerto Rico gets slammed here (ala Detroit) this will have a major impact on New York City's financial condition and perhaps a City or two up here as well. God forbid if this is another financial bubble as well. New York City going bankrupt was before the 1920's "de riguer" actually. (Canals, Railroads, chemical business, steel...you name it, it was boom and bust all the time back then.)

Tue, 07/01/2014 - 22:08 | 4916245 buzzsaw99
buzzsaw99's picture

oklahoma has more earthquakes than anyone lately but the oil and gas industry isn't to blame. [/sarc]

no way in hell the oil and gas industry doesn't get whatever the fuck they want in texas and oklahoma.

Tue, 07/01/2014 - 22:29 | 4916337 Oldwood
Oldwood's picture

We know that the federal government is against any kind of drilling, gas oil and probably water. We also know, as it is with climate change, that virtually all research funding comes from the federal government.

We also know that any defense of the drilling industry will come from or be paid for by the drilling industry.

So the question is;

        Who do YOU want to believe?

Wed, 07/02/2014 - 00:30 | 4916684 sylviasays
sylviasays's picture

When the rare quakes do occur, they're typically linked to the disposal of drilling fluids in underground injection wells...

http://newsok.com/seismologist-fracking-doesnt-cause-earthquakes/article...

Wed, 07/02/2014 - 05:33 | 4916937 SoCalBusted
SoCalBusted's picture

LOL... out here people sell equake insurance..get with the program

Tue, 07/01/2014 - 22:08 | 4916247 ebworthen
ebworthen's picture

I'm not one for over regulation but injecting that stuff into the ground cannot be good for the ground water supplies and those are high density population zones.

It can't be good for underground aquifers that naturally filter out a lot of nasty chemicals and pathogens if left undisturbed.

Not to mention the geological effects of rupturing the structure of sedimentary layers.

Knowing the oil/gas industry their eagerness to get oil has outpaced solid research.

Tue, 07/01/2014 - 22:12 | 4916267 Grande Tetons
Grande Tetons's picture

You can not unbaste a turkey. 

Tue, 07/01/2014 - 22:51 | 4916403 Crawdaddy
Crawdaddy's picture

A background tune for the wealthy and just divorced lesbians who found out alimony applies to their ass too...

Tue, 07/01/2014 - 22:20 | 4916308 Oldwood
Oldwood's picture

Knowing what we "know" about global warming...er...climate change, we obviously didn't do the proper research on oil before we started drilling and consuming. We should have just stuck with horses and mules I guess. I think we have been fracking since the forties but we should just stop now and figure this out I guess. We have to be sure, right?

But one can't help but wonder what our economy would look like today if we were not going after this gas.

Tue, 07/01/2014 - 22:57 | 4916421 Flakmeister
Flakmeister's picture

Imagine what upstate would be like with more than a semblance of what GE was.....

That is what the economy could have been...

Wed, 07/02/2014 - 05:37 | 4916939 SoCalBusted
SoCalBusted's picture

GW basins are about 1000 feet down.  Fracking happens at about 7000 feet down.  GW issues happen if the casing goes bad.

Oh and another point..  Oil/Gas industry has eagerness because people will pay more for it than the cost of extration and taxes.

Wed, 07/02/2014 - 08:42 | 4917225 wrs1
wrs1's picture

And you know all this because you are well acquainted with how wells are drilled and have a degree in geology or you just read shit on he internet and post stuff you don't really know crap about?

Tue, 07/01/2014 - 22:13 | 4916274 Caviar Emptor
Caviar Emptor's picture

I had a fracking party near a reservoir just last weekend

Tue, 07/01/2014 - 22:16 | 4916291 BobTheSlob
BobTheSlob's picture

Did you get fracked up or did you take it easy?

Tue, 07/01/2014 - 22:15 | 4916279 BobTheSlob
BobTheSlob's picture

On the plus side: at least they are keeping the decision making at a local level...good for NY State. On the other hand, if I was NY State I'd be a touch more worried about how many people were leaving on a daily basis.

Also, for the loons here on ZH, there's scant evidence that fracking screws up ground water.

Tue, 07/01/2014 - 22:19 | 4916302 10mm
10mm's picture

Cross the boarder to Pa to see the fracking water damage. 

Wed, 07/09/2014 - 19:47 | 4941426 MeelionDollerBogus
MeelionDollerBogus's picture

so by 'scant' you mean 'flammable water'

Tue, 07/01/2014 - 22:30 | 4916342 Pemaquid
Pemaquid's picture

So why no mention of the exact "chemicals" that are injected? What are they?

Tue, 07/01/2014 - 22:44 | 4916384 Captchured
Captchured's picture

http://fracfocus.org/chemical-use/what-chemicals-are-used

 

If you don't know anything about chemistry, are scared of math, believe in voodoo, and generally have your head up your ass then this list will look really scary to you. So, don't look. Just take in the length of the list and the use of words with more than 4 letters and fear for your life.

Tue, 07/01/2014 - 23:10 | 4916452 post turtle saver
post turtle saver's picture

I can't believe how much dihydrogen monoxide they use... scary stuff

Wed, 07/02/2014 - 00:23 | 4916672 sylviasays
sylviasays's picture

Water accounts for about 90 percent of the fracturing mixture and sand accounts for about 9.5 percent. Chemicals account for the remaining one half of one percent of the mixture. There are several ways oil and natural gas companies manage the use of fracturing fluids, depending on what specifically is in them, the presence of usable groundwater or surface waters, geography, and local, state, and federal regulations.

Spent or used fracturing fluids are normally recovered at the initial stage of well production and recycled in a closed system for future use or disposed of under regulation, either by surface discharge where authorized under the Clean Water Act or by injection into Class II wells as authorized under the Safe Drinking Water Act. Regulation may also allow recovered fracturing fluids to be disposed of at appropriate commercial facilities. Not all fracturing fluid returns to the surface. Over the life of the well, some is left behind and confined by thousands of feet of rock layers.

http://www.energyfromshale.org/hydraulic-fracturing/hydraulic-fracturing...

Tue, 07/01/2014 - 22:50 | 4916401 NidStyles
NidStyles's picture

From the list of chemicals I just read about on Wiki, nothing to really be worried about. 

Wed, 07/02/2014 - 03:52 | 4916887 laomei
laomei's picture

It's not just about what goes down, but what comes back up and what has been disrupted down in those depths.  Once deep subterranean formations have been fractured, there's no going back and yes, it all leaks.  Massive amounts of water which are all toxic, laced with heavy metals and other fun things not all that good for things that are alive.  It drills through the water table, and sorry, but once that has been breeched, again, there is no going back.  No seals or collars will ever repair that.  It all leaks, just a matter of time.  60% within 30 years for normal wells, but for fracked wells, it's virtually 100% within a much shorter time frame.  These are drilled fast and cheap as the production peak only lasts for 2~3 years at most.  Keep it up america, once you bother doing the math on drilling and half-way decent sealing and maintaining of leaking wells... there is zero profit to be made.  However, the trick is to sell off wells and land to investors once fracked, leaving it in their hands.  The small companies go bankrupt and repairs are never made, dropping it all in the laps of the taxpayers (sound familiar?).  There's big money in play here of course, so they buy the silence of those they harm... any attempts to legally fight will be met with decades of appeals and stalling until the plaintiffs are either tapped out legally or dead.

Wed, 07/02/2014 - 08:41 | 4917222 sessinpo
sessinpo's picture

laomei   , but once that has been breeched, again, there is no going back.  No seals or collars will ever repair that.

----

Sounds like the propaganda after the bp oil leak. Yet the gulf survived. While there were some effects, nature took care of most of it.

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