Last month a 4.4 magnitude earthquake occurred in the town of Fox Creek, Alberta, Canada. An earthquake of that magnitude, causing no damage, rarely makes international news. However, a quote from an Alberta Energy Regulator spokesperson saying that “Preliminary information indicates the event may be related to hydraulic fracturing operations in the area” set off a media frenzy. Regulators haven’t had time to complete their investigation, but if that’s the case, it would be the strongest earthquake ever caused by fracking.
Researchers across the globe have been looking into whether the controversial drilling practice causes earthquakes. A study published January 6 in the Bulletin of the Seismological Society of America linked a March 2014 series of 77 earthquakes with magnitudes from 1.0 to 3.0 near Poland Township, Ohio to fracking. Only the strongest earthquake, measured at 3.0, was reported by the local community, and none of the quakes were strong enough to cause any damage. According to scientists, it’s unlikely that any quake with a magnitude of less than 5.0 would cause damage.
Poland Township is not an area known for earthquakes. In fact, none were recorded in the area until the fracking began, and once the Ohio Department of Natural Resources halted fracking operations at the nearby Hilcorp Energy wells, the earthquakes stopped within 2 days. By comparing the identified earthquakes with well stimulation reports, the researchers found that the earthquakes temporally and spatially coincided with fracking at specific stages of well stimulation. Study co-author Robert Skoumal, a graduate student in seismology at Miami University in Ohio, stated that “This activity did not create a new fault, rather it activated one that we didn’t know about prior to the seismic activity.” He went on to note that “Because earthquakes were identified at only the northeastern extent of the operation, it appears that a relatively small portion of the operation is responsible for the events.”
Map analyzed for links between felt earthquakes and energy development courtesy of U.S. Geological Survey.
While felt earthquakes linked to fracking are quite rare, small tremors are much more common and have been increasing over the last 10 years. An earlier study linked fracking to almost 400 small earthquakes around Canton, Ohio in 2013. Ohio and Alberta are just two in a list of places where fracking is blamed for earthquakes. We’ve previously discussed induced seismicity linked to fracking in Northern England. Colorado, Texas, Arkansas, and Oklahoma have all dealt with earthquakes that were linked back to wastewater disposal wells, which are not directly related to fracking, but may be used to dispose of wastewater from fracking operations.
As more connections are made between nearby earthquakes and fracking operations, it’s a good idea for property owners in those areas to take a close look at their insurance policy. Some policies exclude fracking as a cause in earthquake-related damage.
As we’ve discussed before, in 2012, Nationwide announced that fracking was not covered in homeowners’ or commercial policies. In a press release the company stated, “Fracking-related losses have never been a covered loss under personal or commercial lines policies.”
This is not surprising, because policies typically exclude damage from environmental contamination unless special environmental coverage has been obtained. Most insurance policies also include an “earth movement” exclusion, so they won’t cover earthquake damages unless property owners have purchased additional endorsements for their policy. And even the endorsements may have exclusions that would preclude coverage of fracking or injection well-related damages without a legal battle. For homeowners and business owners near fracking sites, it’s important to read their policy carefully and discuss coverage options and exclusions with their insurance agent.
Former Kansas Insurance Commissioner Sandy Praeger said that insurance companies are still figuring out how to deal with fracking. “This is a fairly new phenomenon,” Praeger said. “I would imagine as policies get filed, they are adding that language.”
For everyone whose homes or businesses are affected by fracking, the risks are still unclear, and the rules continue to evolve.
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