Ohio Supreme Court Affirms Oil & Gas Drilling Rules Are State’s Prerogative

The Ohio Supreme Court decided yesterday that state laws regulating  Ohio’s oil and gas production trump conflicting city ordinances. In a 4-3 decision, the Court decided in favor of Beck Energy Corporation. In 2011, the company was issued a stop work order by the city of Monroe Falls when they attempted to begin drilling on land within the city limits. The city argued the stop work order was for alleged violations of city ordinances and local zoning permits, specific to oil and gas drilling operations.

In 2004, the Ohio legislature enacted laws to provide for “uniform statewide regulation” of oil and gas production in the state. That law gave the state “sole and exclusive authority” to regulate permitting, location, spacing and operations of oil and gas production in Ohio and as Supreme Court Justice Judi French’s explained in her lead opinion, state law does not allow a municipality “to discriminate against, unfairly impede, or obstruct oil and gas activities and operations that the state has permitted”.

This decision will make it harder for cities to enforce local oil and gas specific ordinances that are in conflict with state regulations set by the Ohio Department of Natural Resources. The decision will likely impact felt other Ohio cities that recently have passed or attempted to pass local ordinances aimed at banning oil and gas exploration and the development of new natural gas pipelines.