New York’s Fracking Ban May Spawn Litigation — Or Maybe Just Despair

by Daniel Fisher,

New York Gov. Andrew Cuomo made it official today, banning hydraulic fracking within the state after the Health Department issued a report listing numerous potential drawbacks to the oil and gas drilling technique.

The ban doesn’t change much on the ground, since fracking was already prohibited by moratorium since 2008.But it could give landowners and companies that paid millions of dollars for the mineral rights to drill in the gas-rich Marcellus Shale deposit a potential takings claim against the government for depriving them of property without payment.

“Whereas before you had a temporary moratorium, now that it’s going to be permanent you might have a case for taking mineral resources without just compensation,” said Thomas West of the West Law Firm in Albany, who represents landowners and oil and gas drillers across the region. “If you’ve invested $10-20 million or a hundred million for leases that you can no longer use, you might have a case.”

A case, perhaps, but a tough one to win. Farmers, who are the big losers under this ban, might have the weakest argument if they own both surface and mineral rights since the state can say they still have some economic benefit from their property. Until they’re forced to sell because they can’t make a living running a dairy, that is.

The ban is popular with environmentalists, of course, but it will deprive farmers and other landowners of billions of dollars in royalties their neighbors in Pennsylvania are enjoying with the fracking boom. And that’s sad, since New York’s Health Department report doesn’t give much supporting evidence for the ban, other than vague claims of surface pollution, noise and economic disruption that accompany any large-scale industrial development.

The report cites no solid evidence that fracking can cause methane and other hydrocarbons trapped in shale rock thousands of feet underground to suddenly change their behavior and migrate through a mile or more of bedrock. Fracking can contaminate groundwater, of course, but only if drillers make mistakes installing well casing, or spill oil or fracking fluids on the surface — accidents that can happen with any type of drilling.

The report halfheartedly cites a data-mining exercise that found low birthweights associated with mothers who lived within two miles of a fracking site (but no signs of congenital defects or premature births) as well as the obvious risks of surface tanks leaking or drillers disposing of frack water illegally, again, a risk with any form of drilling or industrial activity involving waste. Likewise the report cites the risk of higher benzene and dust from trucks serving drill sites. As opposed, one suspects, to trucks serving a mall or a casino construction site.

Some of the sketchiest “health effects” are economic, such as those described in this passage:

Many historical examples exist of the negative impact of rapid and concentrated increases in extractive resource development (e.g., energy, precious metals) resulting in indirect community impacts such as interference with quality-of-life (e.g., noise, odors), overburdened transportation and health infrastructure, and disproportionate increases in social problems, particularly in small isolated rural communities where local governments and infrastructure tend to be unprepared for rapid changes.

That seems to be the real motivation behind the ban, along with the nihilistic strategy of some environmentalists to fight hydrocarbon development wherever it is to help force a transition to solar, wind and other renewable resources. But combined with the New York Supreme Court’s ruling allowing local jurisdictions to ban fracking, it really just means New York landowners and residents won’t get the benefit of the shale boom that is enriching nearby states like Pennsylvania.

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