By danny restivo
The city and a local energy company, whose owner is accused of dumping drilling waste into the Mahoning River, have been named as defendants in a lawsuit filed by a Texas-based energy company.
Carrizo LLC, a gas and oil exploration company headquartered in Houston, has filed a lawsuit in federal district court seeking $1.75 million from D&L Energy Inc. of Youngstown, and $477,000 from Huntington Energy Group LLC of Greensburg, Pa., which partnered with D&L Energy in a gas lease in the city. The lawsuit also seeks to reinstate Carrizo’s drilling rights in Girard.
Carrizo claims D&L, Huntington and the city of Girard were involved in selling an expired drilling lease to Carrizo.
The lawsuit, which was filed Feb. 22 in the U.S. District Court of Ohio northeastern division, stems from a March 2006 oil and gas drilling agreement between D&L Energy and Girard. Mayor James Melfi said the five-year agreement allowed D&L to drill at four places in the city, but the company drilled a well only at the city’s Liberty Park.
According to the lawsuit, D&L Energy sold a large portion of its “working interests and net revenue interests” to Carrizo in exchange for $1.75 million in November 2011. Carrizo also paid $477,000 to Huntington, which had purchased leasing interests from D&L Energy earlier that year.
Melfi said he believes that D&L Energy sold Carrizo expired leasing rights. He said the city then filed an injunction to keep Carrizo from drilling at the leased properties throughout the city,
“They [Carrizo] paid $1.7 million for rights D&L Energy didn’t have,” said Melfi. “We’ve informed Carrizo that they are not allowed to drill on that property.”
The Vindicator’s calls to Carrizo corporate offices in Houston and to D&L’s office in Youngstown seeking comment were not returned Wednesday.
According to the lawsuit, D&L Energy and Huntington did not “notify Carrizo that there were any problems or issues [with] the mineral rights granted.”
Ben Lupo, who is named as D&L’s owner in the lawsuit, is scheduled to appear in federal court Friday. He is accused of violating the U.S. Clean Water Act after he instructed employees at another of his companies, Hardrock Excavating, to dump hundreds of thousands of gallons of brine water and drilling waste down a storm drain that eventually made its way into the Mahoning River.