AVELLA, Pa. - Citing the apparent contamination of 16 families' drinking water supplies, Pennsylvania regulators are fining Chesapeake Energy more than $1 million.
The fines stem from pollution reports in Bradford County - also the site of an April 19 wellhead failure by Chesapeake - and the Feb. 23 natural gas liquids fire at an Avella, Pa., site, which is roughly12 miles east of Wellsburg.
"The water well contamination fine is the largest single penalty (Pennsylvania) Department of Environmental Protection has ever assessed against an oil and gas operator, and the Avella tank fire penalty is the highest we could assess under the Oil and Gas Act," said Mike Krancer, secretary of the Pennsylvania DEP.
Krancer said the DEP investigated private water well complaints from several Bradford County residents living near Cheapeake's operations.
The agency determined improper well casing and cementing by Chesapeake in shallow zones allowed methane to migrate into groundwater, thus polluting the drinking water supplies.
"Even though the results of our joint review remain inconclusive at this time, we believe proceeding with an agreement and taking prompt steps to enhance our casing and cementing practices and procedures was the right thing to do," Chesapeake spokesman Brian Grove said of the Bradford County contamination reports.
"As a result of the unique geology in this particular region, shallow methane is located at depths considerably above the targeted Marcellus Shale formation," Grove continued. "Drilling operations in this area may change the pressure equilibrium in these shallow zones and cause gas to migrate."
In response to reports of methane in groundwater, Chesapeake engineers enhanced the casing and cementing practices and procedures by adding more cement and steel reinforcement to seal and secure shallow gas zones, company information states.
"We test all known water sources within 2,500 feet of our proposed drilling locations before we start any drilling activities," Grove added, noting Pennsylvania only requires this for locations within 1,000 feet.
As for the Avella accident, Keystone State regulators determined the cause of the Feb. 23 fire was the improper handling and management of natural gas liquids, such as ethane, butane, propane and pentane.
Chesapeake finished drilling and fracking at the site before the fire.
On the evening of the accident, workers were testing the wells and collecting fluid when the tanks ignited, causing them to catch fire.
"Through the course of our investigation, we have identified practices that can improve our operations," said Stacey Brodak, Chesapeake's director of corporate development, regarding the Avella fire. "With that said, we are grateful the three contract employees who were injured are recovering. Safety is a top priority in every facet of our operations whether it involves our employees, contractors, neighbors or the environment."
The total $1.088 million in fines against Chesapeake breaks down to a $700,000 civil penalty for the Bradford County water contamination; a $200,000 deposit into the state's well plugging fund; and a $188,000 civil penalty for the Avella fire.