HMS Legal Blog

       On August 1, 2016, The Pennsylvania Department of Environmental Protection (DEP) released its 2015 Oil and Gas Annual Report (Report).[1]  In additional to natural gas production details, the Report provides information on natural gas data trends in Pennsylvania and details on DEP inspections.  2015 was a difficult year for the natural gas industry as it faced record inventory levels, declining prices, and decreases in newly drilled wells.[2]  DEP confirms Pennsylvania was not immune to the national downturn in natural gas drilling with only 1,070 newly drilled wells in 2015 – more than a 50% decrease from the 2,163 new wells drilled in 2014.[3]

On January 2, 2014 the Pennsylvania Public Utility Commission and Department of Environmental Protection (“Applicants”) filed an Application for Reargument of Robinson Township,1 in the Pennsylvania Supreme Court, requesting reconsideration of the December 19, 2013 plurality opinion and remand to the Commonwealth Court for an evidentiary hearing and findings of fact.  The Applicants argue that the plurality of the Court, in applying its newly coined Environmental Rights Amendment balancing test, adopted novel and unsupported findings of fact, contrary to established Supreme Court principle against taking on a fact finding role in its appellate jurisdiction.  Robinson Township, et al., (“Townships”) answer that no disputed facts were necessary to the Court’s balancing test, and in the alternative, judicial estoppel precludes Applicants from requesting an evidentiary hearing because Applicants successfully argued in the Commonwealth Court that the Act’s constitutionality was purely a question of law.  Applicants also request remand to have the Commonwealth Court determine whether the unconstitutional set back provisions are severable from the rest of Act 13.

The Pennsylvania Supreme Court held key provisions of Act 13 unconstitutional under the Environmental Rights Amendment (ERA) of the Pennsylvania Constitution in a plurality opinion on December 19, 2013.  Act 13 was designed to streamline regulation of the oil and gas industry by setting statewide zoning standards and administrative review procedures, which posed significant financial ramifications for non-compliant municipalities.  The Court specifically held that the provisions mandating municipal zoning standards, such as permitting industrial oil and gas operations as a use of right in every zoning district throughout the state, are unconstitutional. These provisions were overturned because the legislature has abrogated constitutionally proscribed municipal duties to protect the rights guaranteed by the ERA.  The Court also held that provisions of the act imposing a waiver process for mandatory setback from waterways, administered by DEP, also violated the ERA.