WHEELING – Two Northern Panhandle mineral owners accuse Southwestern Energy of a practice called well bashing, claiming the company has wasted natural resources and cost hundreds of people production royalties.
Craig Yoho and Samuel D. Yoho are the named plaintiffs in the potential class-action lawsuit filed March 16 in federal court against Southwestern Energy Company and SWN Production Company LLC.
“West Virginia’s natural resources are far too precious for any company to waste,” attorney Brian Swiger told The West Virginia Record. “Well bashing is the quickest and least expensive way for exploration and production companies to hold acreage by production.
Swiger
| Courtesy photo
“Unfortunately, it also creates far greater risk of wasting natural gas.”
Swiger is one of the attorneys representing the Yohos and other potential members of that class action. Those lawyers also filed a similar lawsuit April 10 on behalf of some Wetzel County and Pennsylvania residents against Antero Resources Corporation.
Well bashing occurs when a newer “child well” is completed near an older “parent well” already producing natural gas. Both wells are horizontally drilled and hydraulically fractured (fracked) to force open existing fractures, create new ones and extract oil and gas from the shale formation.
“The ‘bashing’ damage to the parent well occurs because delayed drilling or completion and eventual operation of the child well lowers the overall pressure of the parent or clogs the parent with the fracking fluids and sand, and can potentially cause permanent damage and lower the overall amount recovered from the reservoir,” the complaints state.
The complaints also say this damage is easily avoided using a combo development method of drilling that involves the timely drilling completion and operation of all wells on each pad within a defined geographical area without excessive delay between the drilling completion and operation of each well.
The plaintiffs say gas developers, such as Southwestern and Antero, avoid combo development for a variety of reasons, from poor planning to “simple greed.” They say the search for corporate investment and bonus goals lead to them establishing “proven undeveloped reserves” or “PUDs” to beef up value and operations projections.
The child wells come later, they say, “even though the developer knows the untimely drilling and completion of a child well can and, in some areas, does sharply reduce the production of the parent well.”
These practices “harm the interests of parent-well royalty owners like the plaintiffs,” according to the complaints.
In their complaint, the Yohos say Southwestern’s actions have diminished their royalty payments by 10-15 percent, resulting in millions of dollars in lost royalties. They describe their parent well that was completed May 6, 2010. An adjacent child well was completed May 12, 2017.
Since that child well was completed through the end of 2021, the Yohos say they lost royalties exceeding $70,000. Estimated losses through August 2064 have the total losses at nearly $300,000.
In the Antero complaint, plaintiffs Carolyn Seckman, Charles and Gail Anderson and William and Kimberly VanCampen make similar claims about their wells in Tyler and Doddridge counties. They say they have lost royalties of more than $600,000 and $750,000 so far.
The plaintiffs also say the practice of drilling parent wells also lowers company expenses because it doesn’t have to pay to renew unused leases.
“This practice of parent-child development as opposed to combo development, comes at the expense of the royalty owners whose gas reserves are wasted and diminished,” the plaintiffs say.
The plaintiffs accuse the defendant companies of negligent waste of gas, breach of implied covenant of reasonable development and private nuisance.
They seek compensatory damages, pre- and post-judgment interests, court costs, attorney fees and other relief.
Plaintiffs in both complaints are being represented by Swiger, John Barrett, Jack Budig, Jeffrey Parsons and Benjamin Hogan of Bailey Glasser in Charleston. Both cases have been assigned to District Judge John Preston Bailey.
U.S. District Court for the Northern District of West Virginia case numbers 5:23-cv-101 (Yoho) and 5:23-cv-136 (Seckman, Anderson and VanCampen)