Hydraulic Fracking Ban in the Marcellus Shale

Hydraulic Fracking Ban in the Marcellus Shale

A few months ago the Supreme Court of New York ruled that the city of Drydon, located in Tompkins County, is legally allowed to ban natural gas drilling. While they may call this a ban on drilling, this is really a ban on fracking due to environmental concerns.  This court decision has serious implications for a number of parties. Hydraulic Fracturing has garnered a significant amount of attention and with the court’s decision this is unlikely to change in the future.

Marcellus Shale Operators

For Marcellus Shale operators, the courts decision is a significant blow and could signal increasing regulatory difficulty when fracking is involved with drilling. While fracking has had a significant impact for operators around the country, some states and counties are concerned about the environmental impact.  Operators have spent significant resources to research fracking and the impact that fracking has on the environment.  Despite the best efforts by operators, regulatory issues are still posing a threat to the exploration of Oil & Gas.  Marcellus Shale operators have been forced to rethink their plans in certain areas due to regulatory issues.

 

Marcellus Shale Mineral Owners

Many Marcellus Shale mineral owners may not see the impact that goverment regulation will have on them directly.  It is important for mineral owners to understand that increased government regulation could have a negative impact on mineral owners in a variety of ways.  For example, if operators are forced to jumped through additional hoops to drill they may be less interested in certain areas.  If operators are spending a significant amount of their budget fighting legal battles with regulatory agencies, this could lead to a reduced amount of leasing activity and a reduced lease bonus amount.

Understanding the environmental impact of fracking is important, but to date no conclusive evidence has been presented that shows fracking (when done properly) is a threat to residents.  Mineral owners should watch the developments surrounding fracking and regulation closely because these issues will ultimately affect the value of the minerals.

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