Posted at: 11/29/2012 5:58 PM
Updated at: 11/29/2012 6:17 PM
By: Amanda Ciavarri
A natural gas drilling company is suing the Town of Avon over a local moratorium it says threatens to put the company out of business.
Lenape Resources has operated in Avon for decades and now the company is saying if the moratorium stays, they will ask for $50 million.
The lawsuit was filed two weeks ago against the Town of Avon, the town board and the New York State Department of Environmental Conservation.
Lenape Resources say this moratorium will shut down their business. Avon passed the one-year moratorium at the end of June. Lenape Resources, which has about 25 gas wells in Avon, drilled without hydrofracking. There is a state wide moratorium preventing hydrofracking, but the Town of Avon passed a ban that the leaders of Lenape say bans all oil and gas drilling.
Even though the town grand fathered in Lenape's existing vertical wells, the company's president said to be safe he shut them down, ending free gas service to some residents. After a long review of the law, Lenape is suing saying their message is simple...
John Holko, Lenape Resources Corp. said, “Look if you think you can do that and you are right then what has happened is you have an unconstitutional taking of property because the only property we have is our mineral rights and to develop them. We are taking those rights and by law you can't take them without just compensation so what we say is if you are right then we want at least $50 million for what you've taken from us.”
Both sides will be in court January 7.
The Town of Avon had no comment now that this is a filed lawsuit. The town board is expected to talk about it at its meeting Thursday night.