Suburban oil drilling in Rochester Hills
Activist group sues city to halt potential oil, gas exploration.
Published: May 28, 2014
For years, the oil and gas business in Michigan has been contained to the northern portions of the state. But in recent years, exploration companies have expanded their footprint, drilling in new territory — in particular, southeast Michigan.
Nowhere has the industry gained more traction across the region than in Oakland County, where a number of public objections have been raised to potential drilling in suburban communities. But in reality, the county is no stranger to the oil landman: About 300 wells have been drilled in Oakland since 1927; the county has 21 active oil wells and nine active gas wells, according to the Michigan Department of Environmental Quality.
And due to the persistence of two Traverse City-based oil and gas exploration firms — Jordan Development Company and West Bay Exploration — the level of activity could soon increase. In recent years, Waterford Township, Springfield Township, Independence Township, and Rochester Hills have all leased the mineral rights of municipal-owned property to the companies for potential drilling. A similar offer from Jordan was shot down by the city of Rochester last year.
To city and township officials, the financial terms of the leases make sense: Jordan and West Bay have offered a $100- to $150-per-acre signing bonus. If the companies discover oil or gas, they would pay the community one-fifth to one-sixth of the net revenue from a future sale of resources. (Rates appear to vary across the state: In March, MLive reported a company buying mineral rights in Genesee County offered private landowners $35 per acre, plus one-sixth of royalties.)
In Rochester Hills’ case, the city’s five-year lease would generate just $9,000 for its coffers upfront.
But some residents vehemently opposed to the city’s deal have cried foul. Earlier this month, a grass-roots group called Don’t Drill the Hills filed a lawsuit against the city and Jordan to halt potential drilling under two city parks and a city-owned cemetery.
Some background: Jordan first approached Rochester Hills about a potential lease in late 2012. The company was interested in city-owned Tienken Park, Nowicki Park, and VanHoosen Jones Creek Cemetery, according to the complaint. In December of that year, Rochester Hills City Council approved a lease, granting Jordan the rights to explore for, extract, and sell any oil underneath those properties, the complaint said. The city’s mayor, Bryan Barnett, signed the lease the following month.
The lawsuit, filed in Oakland County Circuit Court, contends a voter-approved charter amendment in 2011 blocks Rochester Hills from leasing, selling, or converting city-owned parks to other uses — unless voters approve the changes.
The legal challenge was the next “logical step,” says Gail Hammill of Don’t Drill the Hills. “We had the charter amendment in 2011 that we voted on that said you couldn’t lease the parks. And suddenly they’ve leased the parks without a vote, without notification, without anything … and in the dead of December.”
Suburban drilling in neighborhoods and parks has generated headlines nationwide, especially at a time when hydraulic fracturing — a mining method commonly known as “fracking” that involves injecting water, chemicals, and sand into shale rock, creating cracks that force gas or oil up — has been a boon to the industry over the last decade.
Advocates say fears of the dreaded F-bomb are completely overblown, but Don’t Drill the Hills says Jordan’s lease provides a loophole to extract oil and gas as they deem fit, a concern when reports have shown sloppy fracking has caused groundwater contamination. According to The Christian Science Monitor, a study last year found wastewater from fracking, as well as other forms of gas and oil extraction, from a western Pennsylvania treatment facility contained contaminants even after being treated.
Nevertheless, Jordan has pursued mineral rights leases with private homeowners. And the company has maintained to city officials and landowners that neither high-volume nor low-volume fracking would be used in Rochester Hills, said city attorney John Staran.
Jordan insists there’d be “no disruption to the city’s use of those properties as parks … that there’d be absolutely no drilling activities [on-site] and there’d be absolutely no fracking going on in the city,” Staran tells Metro Times.
The company would use a method known as horizontal drilling, Staran explains. The way it would work: a wellhead would be located as far as two miles from the oil or gas. Then, as officials put it, the structure would travel horizontally underground to the resources, out of residents’ sight.
“We wouldn’t even know if they were there,” Staran says.
The production facility would be situated farther out from the resources, officials have said. But, for now, it’s unclear where the wellheads or processing sites would be located. To date, Jordan hasn’t begun drilling in Rochester Hills.
Nevertheless, says Hammill, her group has researched other suburban drilling sites in Pennsylvania, Colorado, and Ohio. She says it’s possible that trucks transporting resources to production facilities might have leaks, and the drill sites could pose a health risk.
Nic Clark, Michigan director of Clean Water Action, a national environmental protection agency, says Hammill’s concerns are reasonable. “Average people have realized … these cast wells smell a lot of times … that’s one of the biggest impacts.”
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