Ohio Supreme Court rules against municipality in oil and gas case

The Ohio Supreme Court ruled that the city of Munroe Falls cannot impose local drilling and zoning ordinances that conflict with Ohio state law regarding oil and natural gas activities. The high court split in a 4-3 decision with three justices providing written dissents.

The Ohio Supreme Court ruled that the city of Munroe Falls cannot impose local drilling and zoning ordinances that conflict with Ohio state law regarding oil and natural gas activities. The high court split in a 4-3 decision with three justices providing written dissents.

The state’s high court on Feb. 17 found Munroe Falls, a suburb of Akron, could not stop Beck Energy Corp. of Ravenna, Ohio, from drilling a vertical gas well in sandstone. City officials and a trial court had maintained that four local oil and gas drilling laws and a zoning ordinance were being violated.

Shawn Bennett, executive vice-president of the Ohio Oil & Gas Association, commended Ohio’s Supreme Court for upholding state law concerning local government control over oil and gas activities.

“The court’s ruling affirmed that municipalities are prohibited from instituting rules and regulations that would discriminate against, unfairly impede, or obstruct oil and gas activities that the state has permitted,” Bennett said.

In the Supreme Court’s lead opinion, Justice Judith L. French said home rule does not allow a municipality to halt oil and gas activities that were authorized by state permits.

The decision upheld a Ninth District Court of Appeals decision. Beck Energy obtained a drilling permit in 2011 from the Ohio Department of Natural Resources for a well within Munroe Falls. After drilling started, Munroe Falls asked a Summit County court to permanently stop Beck Energy, saying it was violating several local laws.

A trial court granted the city’s request but the appeals court reversed the decision, and the city appealed to the Ohio Supreme Court.

“This is a classic licensing conflict under our home-rule precedent,” Justice French wrote. “We have consistently held that a municipal-licensing ordinance conflicts with a state-licensing scheme if the local ordinance restricts an activity which a state license permits.”

Justice Judith Ann Lanzinger dissented in an opinion joined by Justices Paul E. Pfeifer and William M. O’Neill. Justices Pfeifer and O’Neill each wrote a dissenting opinion as well.

Justice Lanzinger said state and local authorities have differing interests. She said the home rule amendment of Ohio’s Constitution was intended “to regulate methods of producing oil and gas statewide. These legislative purposes are distinct, and together they present dual conditions to the operation of the oil and gas industry.”

In his dissent, Justice O’Neill said local control of oil and gas drilling was taken away from Ohio’s citizens.

“The Ohio General Assembly has created a zookeeper to feed the elephant in the living room,” he wrote. “What the drilling industry has bought and paid for in campaign contributions they shall receive.”

Contact Paula Dittrick at paulad@ogjonline.com.

*Paula Dittrick is editor of the Unconventional Oil & Gas Report

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