Trinity East Energy of Fort Worth on Thursday filed a lawsuit against the city of Dallas after the company paid more than $19 million to secure oil and gas leases on city property, only to have drilling permits on three separate tracts denied by the Dallas City Council.
The lawsuit claims breach of contract, fraud and unconstitutional taking/inverse condemnation stemming from written and oral assurances made by former Dallas City Manager Mary Suhm and other Dallas officials in support of Trinity East Energy’s plan to drill for natural gas in the Barnett Shale geological formation deep under 3,600 acres of uninhabited and undeveloped portions of west Dallas. According to the lawsuit, Trinity East ultimately invested more than $30 million in an attempt to extract natural gas conveyed to the company through its lease purchases. The company’s total losses over the lifetime of the wells exceed several hundred million dollars.
The saga began in 2007, when Dallas city leaders raised much-needed revenue by asking energy companies, including Trinity East, to submit proposals to lease city property and drill for oil and gas. Trinity East officials say they worked closely with city officials to design the necessary system of equipment on remote, uninhabited city property, much of which is in a flood plain and cannot be developed.