This June earthquakes captured the attention of courts, researchers, and regulators in key oil and gas producing states. Oklahoma’s highest court gave the green light to a lawsuit blaming injection wells for a plaintiff’s home damage and personal injuries suffered during an earthquake. Kentucky is increasing seismic monitoring within the state, and Texas oil and gas regulators continue to study the issue. As geophysics experts seek to know more about the true risks associated with induced seismicity, understanding by the U.S. Geological Survey and researchers continues to take shape.
In a first-of-its kind ruling on June 30, the Oklahoma Supreme Court held that Oklahoma courts have jurisdiction over earthquake lawsuits like the one brought by a plaintiff whose legs were allegedly injured by her falling brick chimney during a 2011 quake. Ladra v. New Dominion LLC et al., No. 113396 (Okla. June 30, 2015). The unanimous ruling over-turned the Lincoln County District Court’s decision that it lacked jurisdiction to hear the case because of the Oklahoma Corporation Commission’s exclusive jurisdiction over oil and gas regulatory matters. The Oklahoma Supreme Court ruled instead that under state law, these private tort actions belong in Oklahoma district courts.
Although the Oklahoma Supreme Court declined to address the merits, the opinion notes that “[w]hether Appellees are negligent or absolutely liable is a matter to be determined by a district court.” To date, no courts have addressed whether negligence or strict liability apply to induced seismicity claims. Texas and Arkansas, however, have rejected strict liability for concussion damage, favoring a negligence standard instead. Yet even negligence claims can lead to large damage awards. For instance, in a trial over property damage due to drilling operation vibrations, an Arkansas jury awarded $300,000 in punitive and compensatory damages in a suit involving claims for negligence, nuisance, and trespass. Hiser v. XTO Energy Inc., No. 4:11CV00517 KGB, 2013 WL 5467186, (E.D. Ark. Sept. 30, 2013) aff’d, 768 F.3d 773 (8th Cir. 2014). It will be interesting to see how the Lincoln County District Court addresses liability under Oklahoma law on remand.
Induced seismicity has attracted interest from geophysical researchers as well recently. On June 2, a series of peer-reviewed papers were published in a special section on injection-induced seismicity in the June 2015 issue of The Leading Edge, a journal of the Society of Exploration Geophysicists. Papers in the issue discuss the impact of injection volume, changes in earthquake hazards, and characteristics of faults implicated in quakes in Oklahoma and other areas. Interestingly, new research suggests that induced seismic events may involve lower shaking intensity than natural events.
Commentary from the U.S. Geological Survey (USGS) about earthquakes occurring in the mid-continent region also indicates that scientific understanding of the risks continues to evolve. Recent statements by the USGS now display a more neutral tone on the cause of possible induced quakes than previous statements laying blame on the energy industry. The USGS notes: “Even within areas with many human-induced earthquakes, however, the activity that seems to induce seismicity at one location may be taking place at many other locations without inducing felt earthquakes.” The USGS also acknowledges that “regions with frequent induced earthquakes may also be subject to damaging earthquakes that would have occurred independently of human activity.”
Purported earthquake risks have nevertheless prompted states to seek further information. For instance, the Kentucky Geological Survey (KGS) is working to install two new networks for gathering low-level seismicity data. Two highly sensitive seismic stations have been installed on remote private property. It is anticipated that this new monitoring capacity will enable KGS to detect microseismic activity which has previously gone undetected. With a similar monitoring measure discussed by the Texas legislature in May, it will be interesting to see if other states enhance seismic tracking capabilities, too, in order to supplement seismic data collection efforts relied upon by the USGS.
This trend of greater monitoring by state authorities has also resulted in greater scrutiny of oil and gas activities by regulators. On June 10 the Texas Railroad Commission conducted its first show cause hearing regarding allegations of induced seismicity. Show cause hearings give the party appearing an opportunity to present testimony and evidence, after which the Commission’s examiners write a proposal for decision that is then submitted to the commissioners. To date, the Texas Railroad Commission has not enforced action against any wells due to induced seismicity risks.
As scientific understanding continues to develop and dispel myths about induced earthquakes, we will continue to track regulatory and legal developments here at The Hydraulic Fracturing Blog.