Range Resources: Town Ordinance Prevents Access to Marcellus Shale


Texas-based Range Resources (RRC:NYSE) recently challenged a drilling ordinance in a small Pennsylvania town in an attempt to get better access to the Marcellus shale.

The company argues that the ordinance passed by South Fayette banning drilling in buffer zones around schools, hospitals and certain other areas does not allow it to pursue its business interests. In addition, the ordinance requires operators to obtain permits for each well, which reportedly cost $5,000.

Range Resources said that the ordinance is in violation of a provision of Pennsylvania's Municipalities Planning Code requiring municipalities to "allow for reasonable development of minerals," reports the Pittsburgh Post-Gazette.

The company argues in its appeal filed with the town's zoning hearing board that the ordinances leave "no place within the township where oil and gas development can occur."

A number of municipalities located on top of the Marcellus shale have attempted to enact bans to prevent companies from attempting to extract natural gas. A West Virginia judge recently struck down the city of Morgantown's ban on the practice.

According to Raymond James, the company believes that its work in the Marcellus area will be able to fund itself by the end of 2013.