Quake Lawsuits Shake Up Shale Play Companies by Arkansas Business, March 25, 2013
Disposal wells are where natural gas drilling companies like BHP Billiton inject the goop left over from their hydraulic fracturing operations. Between 2010 and 2011, hundreds of earthquakes were felt near disposal wells in the Faulkner County area. In 2011, the Arkansas Oil & Gas Commission found sufficient connection between disposal wells and the quakes to nix any further use of disposal wells within a 1,150 square mile radius of the quakes. Since then, a number of landowners have sued the gas companies alleging damage to their homes. This particular lawsuit, filed in federal court in the Eastern District of Arkansas, involves two Greenbrier families, the Millers and the Krisells, who claim their homes suffered damages from the largest of the earthquakes, a 4.7 magnitude that shook the town in February 2011. Emerson Poynter LLP of Little Rock, which has filed suit against gas companies many times in the past, is representing the families. The defendants are BHP Billiton of Australia and Chesapeake Energy of Oklahoma City. Chesapeake was the original operator of the wells but sold its assets to BHP for $4.7 billion in January 2011. Both families’ homes are located about one mile from the epicenter of the 4.7 quake, the suit says. Damage is said to include cracking in concrete, tiles, walls, ceilings, brick facings, crown molding and so forth; foundations have also been unsettled, doors won’t shut and the Millers’ pool won’t consistently hold water. Emerson Poynter is demanding as-yet unspecified damages. The gas companies haven’t yet responded to the suit. [Emphasis added]
[Refer also to:
CLIENT ADVISORY New Technology Creates New Insurance Issues for Oil and Gas Lease Operators by Pascal Ray and the AmWINS Energy Specialty Practice
This shift to unconventional drilling and heavy multi-stage fracking has created new insurance issues for the industry:
• Increase in blowouts during the completion/fracking stage.
• Increase in blowouts involving communication between multiple wells.
• Increase in blowouts caused by casing/cementing failure.
• Increase in blowouts caused by surface events.
In addition to these blowout trends, we are seeing:
• An increase in blowouts involving producing wells.
• An increase in blowouts involving plugged and abandoned wells.
Nationwide Insurance: Fracking Damage Won’t Be Covered July 12, 2012 ]