November 05, 2014

Patterson hates Denton #fracking ban, sues city

A gas well fracked in March sits less than 400 ft from a home
in Denton, which just became Texas' first city to ban fracking.
Neill Cooper/Texas Tribune

With all the other blues for "blue" news in Texas last night, there were a few highlights.

No. 1 was Denton voting to ban oil and gas fracking in that city.

Not so fast, says Land Commissioner Jerry Patterson (and the hogleg in his boot?).

From a Land Office release:
Texas Land Commissioner Jerry Patterson wasted no time in challenging an unconstitutional ban on hydraulic fracturing approved by Denton voters Tuesday. By 7:51 a.m. Wednesday, attorneys for Patterson had filed a lawsuit in Travis County courts seeking a permanent injunction against the “arbitrary, capricious and unreasonable” prohibition. 
 “This ban on hydraulic fracturing is not constitutional and it won’t stand,” Patterson said. “If it were allowed to be enforced it would hurt the schoolchildren of Texas, who earn hundreds of millions of dollars a year on oil and gas production on Permanent School Fund lands. 
 Patterson argues that the prohibition is in violation of Article I, Section 16 of the Texas Constitution, because it prohibits him from performing his duties. Patterson is constitutionally charged with the solemn fiduciary obligation to maximize revenues from leasing public school lands. See Coastal Oil and Gas Corp. v. Garza Energy Trust, 268 S.W.3d 1, 34 (Tex. 2008); Rutherford Oil Corp. v. General Land Office of State of Tex., 776 S.W.2d 232, 235 (Tex. App.–Austin 1989, no writ). Also, according to Texas law, no home-rule ordinance shall contain any provision inconsistent with the general laws enacted by the Legislature of this State. TEX. CONST. art. XI § 5. Therefore, Patterson argues that the prohibition may not be enforced against lands or mineral interests owned by the State of Texas, including lands or mineral interests owned by the State of Texas for which GLO is the lessor. Finally, Patterson states that the Prohibition is Preempted by State law. 
 Patterson filed the lawsuit in defense of the state’s mineral interests. The General Land Office deposited a record $1.2 billion into the state’s $37.7 billion Permanent School Fund for fiscal year 2014. These record earnings are in large part due to the revolution in hydraulic fracturing technologies, which has private companies competing to outbid each other for access to Permanent School Fund lands that previously were of marginal value. Lease rental income on Permanent School Fund land was up more than 653 percent in 2014, and lease bonus income rose by 86 percent over 2013. 
 “The law is clear, the Railroad Commission regulates oil and gas in Texas, not local municipalities,” Patterson said.

The nut graf is the third one.

I don't know if Denton has any old public school lands with oil and gas potential and lease rights that pay out to other entities. (Such things do exist; Falls County, where I am, gets driblets of money from old public school land leases in Archer County, for example.)

That said, especially in an urbanized area like Denton, this is easy to combat.

Land development prices and values will be higher, arguably, without fracking. And, if this baby really drags on, we'll get dueling petroleum geologists duking it out over proven and provable reserves, and especially with gas, we'll get to talk about just how "bubbly" the Barnett Shale is.

I think Patterson's wrong as rain, but, in two months, it won't be his baby.

P. Bush, the young, suburban, nicely Hispanic-tinged face of the Texas GOP — (hello, Julian and Joaquin Castro), gets to handle this baby next year.

So, let's just see how Bush P's on us, OK? Especially since, as the Observer notes, he has personal financial reason to push the suit.

Per the top link, with the O&G industry also threatening to sue? (And now, the Texas Oil and Gas Association has done just that.) The ban on fracking isn't that much more restrictive than Dallas' not-quite-a-ban that really is, and the O&G industry decided to do nothing there.

At the same time, with then Railroad Commission chair Barry Smitherman and commissioner David Porter claiming the Russkies were behind the push for a ban (no, really, click the link just above), these suits will enter the land of whackadoodle.

No comments: