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LENAPEENERGY,.
INC.
40CHAMBE'RSSTREET,SPENCERPORT,NY14559585.344.1200Fax:585.344.3283
July26,2012NewYorkStateDepartmentofEnvironmentalConservationCommissionerJosephMartens625BroadwayAlbany,NY12233-1011Re:TownLawT-A-5-2012/LenapeResourcesInc.DearCommissionerMartens:TheTownofAvon,LivingstonCounty,NewYork("Avon")recentlyadoptedAvonTownLawT-A-5-2012captionedasa"MoratoriumonandProhibitionofGasandPetroleumExplorationandExtractionActivities,UndergroundStorageofNaturalGas,andDisposalofNaturalGasorPetroleumExtraction,ExplorationandProductionWastes"(hereinafterthe"LawProhibitingNaturalGas").AcopyoftheLawProhibitingNaturalGasisattachedforyourreference.TheTownofCaledoniaenactedthevirtuallyidenticallocallawonJune28,2012andtheidenticallawisbeingcontemplatedintheTownofYork.ThetownsofAvon,CaledoniaandYorkarehereinafterreferredtosimplyasthe"Towns."ViolationoftheLawProhibitingNaturalGasispunishablebyfinesandimprisonment.EnvironmentalConservationLaw("EeL")
§
23-0303(2),enactedin198I,statesthatTheprovisionsofthisarticle[Article23]shallsupersedealllocallawsorordinancesrelatingtotheregulationoftheoil,gasandsolutionminingindustries;butshallnotsupersedelocalgovernmentjurisdictionoverlocalroadsortherightsoflocalgovernmentsundertherealpropertytaxlaw.LenapeResourcesInc.oritspredecessorshavebeensafelyandresponsiblydevelopingnaturalgasintheTownsundertheexclusiveregulatoryauthorityoftheNewYorkStateDepartmentofEnvironmentalConservation(the"Department")since1982.FollowingtheenactmentofECL§23-0303(2),theDepartmentroutinelyenforcedtheprovisionsofECL§23-0303(2)bysendingletterstolocalgovernmentofficialsadvisingoftheDepartment'sexclusiveauthoritytoregulateallaspectsofoilandnaturalgasdevelopment,exceptfortheissuesoftaxationandimpactsonlocalroads.ArepresentativecopyofaDepartmentlettertoalocalmunicipalityisattachedheretoforyourreference.PursuanttoECL
§
71-1311(1),theDepartmenthasalegalobligationtoprecludeenforcementoftheLawProhibitingNaturalGas.ECL
§
71-1311(1)statesthat
US_ACTIVE-ll0138166171261122:03PM
 
Wheneveritappearsthatanypersonisviolatingorthreateningtoviolateanyprovisionofarticle
23
ofthischapteroriscommittinganyoffensedescribedinsection
71-1305
ofthistitle,thedepartment,actingbytheAttorneyGeneral,maybringsuitagainstsuchpersoninany
court
ofcompetentjurisdictiontorestrainsuchpersonfromcontinuingsuchviolationorfrom
carrying
outthethreatofviolation.Inanysuchsuit,thecourtshallhavejurisdictiontogranttothedepartmentwithoutbondorotherundertaking,suchprohibitoryormandatoryinjunctionsasthefactsmaywarrant,includingtemporaryrestrainingordersandpreliminaryinjunctions.TheregulationsandrequirementsimposedbytheLawProhibitingNaturalGasconflictwiththestatutoryrequirementsimposedunderArticle23oftheECL,theregulationssetforthin6NYCRRPart550etseq.andtheexistingGenericEnvironmentalJmpactStatementthatiscurrentlyundergoingextensiverevision.Lenapehasbeenforcedtoshut-inanumberofwellsinAvonbecausetheoperationofthosewellsmayresultinviolationsoftheLawProhibitingNaturalGasifproductioncontinued.Lenapenoritsagents,employeesorcontractorsshouldbesubjecttoarrest,finesandpossiblyjailforconductingactivitiesauthorizedundertheexclusiveauthorityofstatelaw.ECL
§23-0303(2)
unquestionablyprecludeslocalgovernmententitiesfromregulatingoilandnaturalgasindustries.TheLawProhibitingNaturalGasunquestionablyattemptstoregulateoilandnaturalgasindustryactivities.EeL
§71-1311(1)
unquestionablygrantsthe
Department
withtheauthoritytoenforcetheprovisionsofArticle
23,
whichincludesthepreemptionprovisionssetforthinECL
§23-0303(2),
uponnoticethattheprovisionofArticlearebeing,orarethreatenedwithbeingviolated.Byandthroughthisletter,LenapeisnotifyingyouthattheTownsareviolating,orarethreateningtoviolate,provisionsofArticle
23
ftheEeL.LenaperespectfuIlyrequeststhatyouroffice,astheregulatorybodywithauthorityoverLenape'soilandgasindustryactivitiesinNewYorkState,takethefollowingactions:(I)advisetheownsthattheLawProhibitingNaturalGasisanillegalandunenforceableact;(2)affirmtoLenapethatitslawfulconductofoperationsundertheexclusiveauthorityofNewYorkStatelawwillnotsubjectLenape,itsagents,employeesorcontractorsto.Iocalenforcementproceedings,includingfinesandimprisonment,LIndertheLawProhibitingNaturalGas;and(3)actingthroughtheOfficeoftheNewYorkStateAttorneyGeneraloronyourownvolition,takelegalactiontoextinguishtheLawProhibitingaturalGasprovisionsinconflictwiththeEeLorthecomplexoilandnaturalgasregulatoryschemeadministeredbytheDepartment.GiventheimportanceoftheseissuestoLenapescontinuedoperationsinNewYork,pleasetaketherequestedactionwithinten(10)days.ThisletterservesasNoticerequiredunderEeL
§71-1311(2)
thatLenapemayinitiatelegalactionauthorizedbyEeL
§71-1311(1)
toenforceECL
§23-
-2-
 
0303(2)iftheDepartment,throughtheAttorneyGeneralfailstoact,namingtheDepartmentasapartytoanyproceedings.Yourpromptattentiontotheseimportantmattersisgreatlyappreciated.AttachmentsAvonLawCaledoniaLawYorkProposedLawresident
CC:Hon.EricSchneidermanOfficeoftheAttorneyGeneralTheCapitolAlbany,NY
12224-0341BradField-DirectoroftheOivisionofMineralResources
NewYorkStateDepartmentofEnvironmentalConservationCommissionerJosephMartens
625
Broadway
Albany,
NY
12233-101]LindaCollart-Region8DivisionofMineralResources
6274E.
Avon-LimaRoadAvon,NY14414-9519MichaelP.Joy,esq.ReedSmith,LLPReedSmithCenter525FifthAvenuePittsburgh,PA15222
'"I
-
.)
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