Earthquake Litigation Shaking Up the Fracking Industry
By Sean Rigby, Staff Contributor
In the past decade, the prevalence of hydraulic fracturing has exploded in many regions of the United States. Fracking, as the process is more commonly called, involves the injection of fracking fluid (a mixture of water, proppants and chemicals) into a rock or coal formation. This allows for the extraction of large quantities of oil and gas that would have otherwise been too costly or unfit for extraction. Fluid that returns to the surface is called flowback, or wastewater, and must be disposed of securely to prevent water contamination. The most common disposal method is the reinjection of flowback into specially dug deep disposal wells.
Fracking has come under scrutiny for the many adverse effects that the process has on the environment. Unsurprisingly, fracking well operators have found themselves at the center of a multitude of legal challenges – suits alleging a host of environmental harms such as groundwater contamination, air pollution, excessive water usage and chemical discharge. Now, it seems, the fracking industry will have to face litigation stemming from a newly alleged side effect of the extraction process: earthquakes.
“Now, it seems, the fracking industry will have to face litigation stemming from a newly alleged side effect of the extraction process: earthquakes.”
A study performed by the U.S. Geological Service (USGS) alleges a link between a rise in earthquakes and the wells used for fracking wastewater disposal. According to USGS researcher William L. Ellsworth, wastewater disposal into deep wells appears to have induced a 2011 earthquake in Arkansas and another one in Youngstown, Ohio. His report also links wastewater disposal to the 2011 earthquake in Prague, Oklahoma – a finding that the Oklahoma Geological Survey refutes. Though much of the research is not yet definitive, scientists increasingly believe that once injected, the underground fluid migrates along dormant fault lines, reactivating them and causing earthquakes.
Cue the lawsuits. Seeking to recover for this newest fracking-related harm, petitioners have already filed suits in multiple jurisdictions. In 2011, landowners in Arkansas filed a class action suit against three well operators, alleging that their wastewater disposal system was responsible for the rise in earthquakes across the state. The suit sought millions of dollars for property damage, loss of fair market value in real estate, emotional distress and damages related to the purchase of earthquake insurance. The defendants settled outside of court and the case was later dismissed. In 2013, two Texas couples filed suit against a handful of fracking well operators for damage to their homes and property caused by “earthquakes, subsidence and other seismic activity.”
“Seeking to recover for this newest fracking-related harm, petitioners have already filed suits in multiple jurisdictions.”
Most recently, a case filed by Sandra Ladra in Oklahoma is poised to set a powerful precedent of whether two oil companies can be held liable in state court for injuries that she suffered during the 2011 earthquake in Prague, Oklahoma. A lower court judge sided with the defendants, ruling that because the oil companies were operating under permits issued by the Oklahoma Corporation Commission, that Commission had jurisdiction of the case. Ms. Ladra’s suit, however, claims that the oil companies had knowledge that wastewater injection could cause seismic activity, and that knowledge represented “wanton or reckless disregard for public or private safety.” As a result of that alleged disregard and negligence, Ms. Ladra’s attorneys claim that the companies should be liable for at least $75,000 in personal injury costs and punitive damages. Now, the Oklahoma Supreme Court has agreed to hear the appeal.
As the scientific community continues to move closer to establishing a definitive link between fracking and earthquakes, chances are high that quake-related litigation will become increasingly prevalent. Despite the high settlement rate thus far in fracking civil suits, the efficacy of these lawsuits in affecting industry policy should not be underestimated. Bad press, public outcry and fear from further liability all serve to prod industry self-improvement, even where state legislatures have been hesitant to impose strict regulatory frameworks.