Source: http://www.star-telegram.com, January 29, 2012
By: Jack Z. Smith
A state district judge has ruled that a Parker County couple lack legal jurisdiction to sue Fort Worth-based Range Resources in a high-profile case involving methane contamination of their water well.
Judge Trey Loftin of the 43rd District Court in Weatherford made his ruling late Friday.
He said Steve and Shyla Lipsky, who live in the upscale Silverado subdivision in far south Parker County, do not have legal standing for their $6.5 million lawsuit against Range in his court because the Texas Railroad Commission determined last year that two of the company’s natural gas wells were not responsible for contaminating the private water well.
Loftin said the proper venue for challenging the March 22 Railroad Commission decision is state district court in Austin.
However, the deadline for appealing the commission’s ruling passed months ago, Range spokesman Matt Pitzarella said Saturday.
The commission made its decision after reviewing testimony by expert witnesses before commission hearing examiners in January 2011.
‘God help us all’
When contacted Saturday, Steve Lipsky said he declined to participate in the commission hearing in 2011 “because I didn’t have a chance.”
“The gas companies own the Railroad Commission,” Lipsky said in reference to Range and other natural gas producers.
“They own the system … they know they got away with it, and they’re laughing about it. … God help us all.”
Lipsky said he and his expert consultants did not have enough time to prepare for the commission hearing.
The meeting was hastily called after the Environmental Protection Agency issued a headline-making emergency order against Range on Dec. 7, 2010. It contended that two of Range’s Barnett Shale gas wells “caused or contributed” to the methane contamination of the Lipskys’ well and another one nearby.
Methane is the primary component of natural gas.
John Blevins, a high-ranking EPA regional official, later backtracked somewhat, saying in a sworn deposition that the Range gas wells “may” have caused or contributed to the contamination.
The three-member Railroad Commission, in its March decision, exonerated Range and said it agreed with hearing examiners and expert consultants hired by Range that the methane gas in the water wells was likely naturally occurring and came from the shallow Strawn geological formation, far above the Barnett Shale, which is more than a mile below the surface.
Pitzarella, the Range spokesman, said in an e-mail Saturday that there are “countless examples” of methane being found in Parker County aquifers before Barnett Shale drilling.
Methane in aquifer
A neighbor of the Lipskys’ had “a 6-foot flame” of gas coming from a water well being drilled on his property four years before Range drilled its two gas wells, Pitzarella said.
Pitzarella was referring to an incident, reported in the Star-Telegram, in which Larry Peck drilled a water well in 2005 that flared large volumes of gas.
Peck has a photograph of the flaring well. The well, referred to as the Hurst well, was drilled roughly 800 feet from the Lipskys’ well, which Peck also drilled.
Pitzarella said that the Railroad Commission, the chief regulator of the state oil and gas industry, held a “thorough” hearing on Range, based on “facts and science” presented by experts, and that “Mr. Lipsky refused to participate in” it.
Loftin’s ruling would dismiss the legal action against Range unless the Lipskys take their case to the 2nd Court of Appeals in Fort Worth.
Lipsky declined to say whether he will appeal.
His attorneys could not be reached for comment.
The attorneys have contended in previous court filings that the commission’s March 22 decision should not affect the couple’s lawsuit.
They note, for example, that the Lipskys do not dispute the commission’s conclusion that the contaminating gas did not migrate from the Barnett Shale, into which the Range wells were drilled.
The Lipskys contend that their water well was infiltrated by methane because Range improperly cemented and cased its gas wells, causing gas from geological formations above the Barnett to seep into their water supply.
Range denies that claim, contending that the well was properly constructed.
The Lipskys’ attorneys also said that the commission’s ruling “cannot provide a basis for rejection of the Lipskys’ lawsuit when that ruling is pre-empted by a contrary order by the [EPA],” a reference to the federal agency’s emergency order against Range.
While Loftin ruled against the Lipskys, other elements of the litigation before the judge remain, including the couple’s claims against people and entities involved in the development of the Silverado subdivision and Range’s counterclaim against the Lipskys and Alisa Rich.
Scientist is sued
Rich is an environmental scientist who tested the water in the Lipskys’ well and urged Steve Lipsky to contact the EPA, leading to the agency’s emergency order.
Range says in its counterclaim that the Lipskys’ contentions are false, have damaged its reputation and have cost it millions in legal fees.
Range has said from the outset that its gas wells did not cause the contamination.
The company and the EPA are still battling in federal courts over the emergency order, with Range arguing in the 5th U.S. Circuit Court of Appeals in New Orleans that the order should be dismissed.