Gas Drilling – Fracking – Interstate Compact

July 24th, 2018 by Rieders Travis in Business and Corporations

GAS DRILLING-FRACKING-INTERSTATE COMPACT- Wayne Land and Mineral Group v. Delaware River Basin Commission, No. 17-1800 (3d Cir. July 3, 2018) Jordan, C.J.  Wayne Land and Mineral Group, LLC, a company that wants to obtain natural gas by fracking reserves in Pennsylvania,1 appeals from the dismissal of its complaint for failure to state a claim. Wayne sought a ruling in the District Court under the Declaratory Judgment Act that an interstate compact does not give the Delaware River Basin Commission authority to review Wayne’s proposed fracking activities. The Commission argued in response that Wayne’s claim was properly dismissed as unripe, that Wayne lacks standing, that there has been no final agency action, and that Wayne has not exhausted available administrative remedies. The District Court rejected those arguments but nevertheless denied Wayne’s request for relief and dismissed the case under Federal Rule of Civil Procedure 12(b)(6), after determining that Wayne’s proposed activities constituted a “project” subject to the Commission’s oversight, according to the unambiguous terms of the interstate compact. Because we conclude that the meaning of the word “project” as used in the compact is ambiguous, we will vacate the order of dismissal and remand the case for fact-finding on the intent of the compact’s drafters.