Operators Liable For Oil And Gas Operations

Under current law governing relations between surface owners and oil and gas operators, to prevail on a claim the surface owner must present evidence that the operator's use of the surface materially interfered with the surface owner's use of the surface of the land. The bill amends this to require the operator to exercise reasonable care to avoid causing bodily injury and to allow proof that the operator's oil and gas operations harmed the surface owner's use of the surface of the land, caused bodily injury to the surface owner or any person residing on the property of the surface owner, or damaged the surface owner's property.

The bill also requires operators to exercise the highest degree of care in conducting operations so as to avoid causing an earthquake. Operators that breach this duty are liable for their conduct if oil and gas operations, including a hydraulic fracturing treatment, cause an earthquake that damages property or injures an individual. A plaintiff establishes a prima facie case of causation by showing that: An earthquake has occurred; the earthquake damaged the plaintiff's property or injured the plaintiff; the operator breached the duty of care; and the oil and gas operations occurred within an area that has been determined to have experienced induced seismicity by a study of induced seismicity that has been independently peer-reviewed. Plaintiffs have 5 years after discovery of the damages or injury to file an action. It is an affirmative defense if the operator has conducted oil and gas operations in accordance with a regulatory requirement or land use plan provision that applies specifically to the alleged intrusion or damage.

(Note: This summary applies to the reengrossed version of this bill as introduced in the second house.)