Residents, Pawnee Nation File Suits Following 5.8 Mag Quake

December 5, 2016

Residents of Pawnee, Okla., have filed suit in district court against 27 energy companies, saying they operate wastewater injection wells even though they know the method causes earthquakes. The lawsuit seeks an unspecified amount for property damage, reduced value and emotional distress.

A magnitude 5.8 earthquake — the largest recorded in Oklahoma — struck the town of about 2,200 in September and the lawsuit claims 52 more have hit the area since. On Nov. 6, a magnitude 5.0 quake damaged buildings in nearby Cushing, home to one of the world’s largest oil hubs.

Oklahoma has had thousands of earthquakes in recent years, nearly all traced to underground wastewater disposal. Regulators have asked oil and gas producers to either close injection wells or reduce the volume of fluids they inject.

Two of the companies identified in the residents’ lawsuit, Eagle Road Oil, LLC and Cummings Oil Company, did not return messages seeking comment. The other 25 companies were not identified in the suit.

A day after the Pawnee residents’ action was filed, the Pawnee Nation of Oklahoma sued the federal government to void drilling permits for oil and natural gas wells on tribal land. The lawsuit filed in U.S. District Court in Tulsa on Nov. 18, claims drilling permits and leases on tribal-owned lands held in trust have been improperly approved by the Interior Department, the Bureau of Indian Affairs and the U.S. Bureau of Land Management.

The Sept. 3 temblor damaged structures in Pawnee, including many of the Pawnee Nation’s administrative buildings, the lawsuit alleges. It also prompted the Oklahoma Corporation Commission to order 37 injection wells near the quake epicenter to temporarily shut down.

The Pawnee Nation, headquartered in Pawnee, has about 3,200 members.

Nearly 300 damage claims have been filed following the Pawnee earthquake, but only four have been reported paid. Oklahoma Insurance Department data show that the approved claims for the Sept. 3 earthquake totaled $24,000, with the largest single payout at around $21,000.

Earthquakes triggered by man-made activities used to be excluded but with the uptick of temblors in Oklahoma insurers now offer coverage for man-made and natural quakes. Insurance Commissioner John Doak said that more than “90 percent of the market is going to cover earthquakes no matter if they’re man-made or natural.”

Topics Lawsuits Catastrophe Energy Oil Gas Oklahoma Earthquake

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Insurance Journal Magazine December 5, 2016
December 5, 2016
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