Family Fights Resale of Gas Rights
Suit: Chesapeake can’t drill on property
Morgantown Dominion Post
1 May 2011
By David Beard
This presentation on Marcellus Shale is the part of a reoccurring
series on the topic. An Ohio County couple is asking a judge to keep
Marcellus gas drillers from their property.
Their civil suit is one of four Chesapeake Appalachia faces concerning
its Marcellus gas operations in north-central West Virginia. The other
three properties are in Wetzel County.
In all four cases, the surface owners filing the suits do not own the
mineral rights beneath their properties.
The cases are filed in the U.S. District Court for the Northern
District of West Virginia, and all are before Senior Judge Frederick P.
Stamp Jr.
Martin and Lisa White, of Silver Hill, Wetzel County, and Dewey and Gay
Teel, of Blake Ridge, Wetzel County, say in their suits that Chesapeake
has permanently damaged and polluted a portion of their property by
burying hazardous Marcellus gas well drilling waste on their land.
Their cases are similar to that of Larry and Jana Rine, of Silver Hill.
The Dominion Post detailed the Rine case in a recent edition.
All three couples are employing the same law firm, Bailey & Glasser
of Charleston, to represent them. Chesapeake is using the same
attorneys, John Meadows and Tim Miller, of Robinson & McElwee,
Charleston, in all three.
In the fourth case, Melvin W. and Carol M. Kahle, of Ohio County, are
seeking a declaratory judgment that Chesapeake does not have the right
to drill on their land, contending the company doesn’t hold a valid
lease. They are represented by the Schrader, Byrd & Companion firm
of Wheeling. Chesapeake is defended by Kevin C. Abbott and Nicolle R.
Snyder, both of Pittsburgh.
Chesapeake and attorneys for the plaintiffs declined to comment on
ongoing litigation.
Kahle case
This was originally filed in Ohio County Circuit Court, and
transferred to federal court in February.
The Kahles say:
They originally signed a lease in May 2006 with Range
Resources-Appalachia, a subsidiary of Texas-based Range Resources. On
Aug. 20, 2010, Range notified the Kahles, verbally and by letter, that
it was terminating its lease.
Sometime after this, Chesapeake notified the Kahles that it had
acquired their existing lease with Range, and on Oct. 18 issued a
Notice of Entry to their land. Chesapeake, without notifying the
Kahles, applied for a drilling permit on Dec. 17.
The 2006 lease does not grant Range authority to sell or assign it.
There was no existing lease, since Range had terminated it.
The plaintiffs want the judge to stop the defendants — which also
include Chesapeake Energy, Chesapeake field representative Kevin Swiger
and Delaware-based Statoil USA Onshore Properties — from entering or
drilling on their land, to void the lease and award damages, fees and
costs.
Chesapeake Energy and Swiger have filed to have the complaint against
them dismissed because they’re not parties to the lease, and Chesapeake
Appalachia and Statoil are the proper defendants. There has been no
ruling on this yet, pending a challenge on remanding the case to
federal court.
Chesapeake also contends it acquired the 2006 lease, valid through May
15, 2011, in July 2010. What Range had terminated was a separate April
2010 “top-lease.” The 2006 lease remained in effect.
The company seeks a judgment that the lease is still valid, it is the
rightful successor to the lease, and — given the expiration date — the
lease will be equitably extended to compensate for delays caused by the
suit.
The scheduling order pretrial and settlement conferences for Oct. 31;
jury selection and trial for Nov. 15.
Whiteman case
This case originated in Wetzel County and was removed to federal
court in February.
The Whitemans own two parcels. They bought the first, 101 acres with
their home, in 1992. The second, 112 acres, includes another house.
They say:
In 2007, Chesapeake began drilling on the second parcel. It graded
10-15 acres, which included the hay fields for the Whitemans’ 100
sheep, for gas wells. Chesapeake assured the Whitemans the gas
operations wouldn’t harm the hayfields.
Chesapeake constructed two large, lined ponds for frack and drilling
waste, which it filled. In 2007, it began new work at the first pond,
trucking in material that it deposited into the pond, and into several
unlined trenches on the site.
Chesapeake tore the pond liner, allowing water to run over bare ground
and into the trenches. It placed a liner over the top of the pond
remnants and buried the pond and trenches.
In 2009, Chesapeake repeated the process for the second pond. Each pond
is about 1,000 feet from the house on that parcel.
The water remains and is spreading through the soil, ground water and
surface water. The land is now either too steep or too swampy for hay
production.
Chesapeake didn’t advise the Whitemans about the waste deposits. They
learned of it through third parties.
The suit charges Chesapeake with nuisance, trespass, negligence,
liability, recklessness or gross negligence and infliction of emotional
distress. It seeks an injunction for Chesapeake to remove the waste and
deposit no more, remediate contamination, detail the quantity, location
and composition of the waste, and punitive, compensatory and special
damages.
In response, Chesapeake denies all allegations and maintains it was
lawfully engaged in work permitted by the Department of Environmental
Protection.
“Chesapeake ... denies that the Whitemans’ permission was necessary.
Chesapeake’s lease and common law property rights expressly gave them
permission to use so much of the surface as was reasonably necessary
for the drilling and production of minerals. ... Chesapeake admits that
as mineral owner, it has a dominant estate and the right to use the
surface.”
It denies constructing “ponds” and says no frack waste was deposited
into pits on site.
The scheduling order sets pretrial and settlement conferences for April
16, 2012, and jury selection and trial for May 1, 2012.
Teel case
This also originated in Wetzel County and was moved to federal
court in January.
The Teels moved onto their 104 acres in 2008. They say:
That same year, Chesapeake cleared and graded about 5 acres, and
assured them the land would be suitable for home sites when work was
complete.
Chesapeake built two large ponds; one was used for drilling and
fracking waste. This site had been the Teels’ only suitable hay field.
In early 2009, Chesapeake began a new work at the site, brought in
“foamy, foulsmelling material” and dumped it into the pond and into
unlined trenches about 12-15 feet deep. Chesapeake also tore the pond
liner, allowing waste liquid to run over bare ground and into the
trenches.
Chesapeake covered the pond remnants with a liner, and buried the pond
and trenches. The waste remains and is spreading through the soil and
groundwater. The soil stinks; trees, grass and plants “grow weakly or
not at all.”
At least two other times, Chesapeake has used something like a hose to
deposit fluids on the surface, killing or weakening trees and other
plants.
The suit also charges Chesapeake with nuisance, trespass, negligence,
liability, recklessness or gross negligence and infliction of emotional
distress. It seeks an injunction for Chesapeake to remove the waste and
deposit no more, remediate contamination, detail the quantity, location
and composition of the waste, and punitive, compensatory and special
damages.
In response, Chesapeake similarly maintains it was lawfully engaged in
work permitted by the Department of Environmental Protection. Its lease
and common law property rights allowed it to use as much of the surface
as was reasonably necessary for drilling and producing minerals,
without the Teels’ permission. It denies constructing “ponds” and says
no frack waste was deposited into pits on site.
The scheduling order sets pretrial and settlement conferences for March
26, 2012, and jury selection and trial for April 10, 2012.
Rine case update
The Rines contend that Chesapeake tore the liner protecting the
pit containing what they call fracking waste — and what Chesapeake
calls drill cuttings — and then buried the waste, allowing it to leach
into the soil and groundwater.
Several Silver Hill residents said they witnessed DEP inspector, David
Scranage, on the site during this time.
“I spoke to him and asked if this was legal,” one resident said. “His
answer was, ‘Yes, they had a permit.’ They were using a track hoe to
mix surrounding dirt in with the tailings pond, the liner was being
ripped to shreds before our eyes, DEP inspector still on scene watching
this. There was perforated pipe in the pit being buried also.”
Asked about this, DEP spokeswoman Kathy Cosco responded via email,
“Inspector David Scranage was on site at some point during the pit
closure. At that time, any pit containing drill cuttings was treated in
a manner consistent with the common industry practice, which involved a
removal of free liquids, then a stabilization process prior to
filling/covering and reclamation. The stabilization process often
included destruction of the liner. When Inspector Scranage was on site,
he witnessed the operator reclaiming the pit in an acceptable manner.
The only foreign matter the inspector observed in the pit was a piece
of fencing, which he required to be removed.”
On Thursday, the Rines filed a motion to withdraw their motion for a
preliminary injunction to stop Chesapeake’s excavation of the drill
cuttings pit and the off-site transportation of the cuttings. A
temporary restraining order on Chesapeake’s excavation had expired,
they said, and the company had nearly completed the job. Stamp granted
the motion the same day.
Also on Thursday, Stamp approved an agreement reached by attorneys for
both sides and submitted Wednesday by Chesapeake’s attorneys.
Chesapeake will provide the Rines advance notice of when the excavation
will be complete, so the Rines’ can take soil samples from the pit.