Cabot buys second polluted residential property in Dimock 12-acre parcel on Carter Road flanked by faulty gas wells

The former Mike Ely propety, now owned by Cabot

Cabot Oil & Gas has closed a deal for a second residential property affected by chronic methane pollution in the heart of its prolific gas operations in Susquehanna County, Pennsylvania.

The Texas-based company paid Michael Ely $140,000 for the 12-acre property that includes a doublewide modular home, according to records filed in Susquehanna County Courthouse Wednesday.  The property – now vacant -- borders the intersection of the south end of Carter Road with State Route 3023 in Dimock Township.

The state Department of Environmental Protection has identified at least two malfunctioning gas wells operated by Cabot bordering the property, including the Gesford 3 well, several hundred yards to the north off Carter Road, and the Costello 1 well, just to the south off Route 3023.

Cabot demolished the former Sautner in September 

The agency has forbidden Cabot to drill more wells in a nine-square mile area around the intersection until the company resolves problems with these and other shale gas wells that – according to the DEP inspectors – are causing methane pollution.

The former Ely property sits less than a mile south from another polluted residential property on Carter Road that Cabot bought for $140,000 from Craig and Julie Sautner last year. Cabot demolished the three-bedroom ranch in September and sold the empty lot to a neighbor for $4,000. The new deed includes a clause – called a land covenant -- that forbids residential dwellings on the property.

Cabot bought both the Sautner and Ely properties through a subsidiary called Susquehanna Real Estate 1 Corp.

Ely ancestral home across from Cabot's newly acquired lot

The former property of Mike Ely is part of a larger swath owned by generations of the Ely family since 1858. Bill Ely, Mike’s father, lives in the family’s large ancestral colonial home near the banks of Burdick Creek, which runs under a bridge connecting Carter Road with Route 3023. Bill Ely and his wife, Sheila, are among families in the area that depend on bottled water. Bill told me he has no intention of selling his 19th century house to the company, even though his water is not drinkable.

“I’m not leaving” Ely said Thursday. “My family’s been in this home for generations.”

Susquehanna County and operations centered in Dimock have been the source of both boon and bane for Cabot, which in 2013 was the second largest natural gas producer in Pennsylvania behind Chesapeake Energy. In the first half of the year, Cabot had 15 of the top producing wells in the state concentrated in its leasehold in Susquehanna County – an area experts call a “sweet spot” for Marcellus Shale production. But production has been beset by problems. Both Mike and Bill Ely were among more than 30 families in the area that settled a law suit with Cabot for damages related to water pollution for an undisclosed amount in 2012. The controversy continues, as Cabot, under the watch of the DEP, attempts to fix problems that have prevented it from drilling any new wells in a 9-square-mile region around the Carter Road area. Some of the gas wells have been plugged or shut down, so residents living over them have seen royalty payments dwindle.

Hazards found in some residential water wells include methane, arsenic, bacteria, and various heavy metals that occur naturally. Methane can make water flammable and pose risks of explosion in wellheads and enclosed spaces. Arsenic, heavy metals, and bacteria can cause illness. Drilling can open pathways that allow contaminants to move through the ground, but the extent to which this happens is open to scientific and legal interpretation. Cabot continues to challenge the DEP findings publically with claims the contaminates are a result of naturally-occurring phenomenon.

The DEP began investigating problems in the region after a residential water well on the north end of Carter Road exploded at the home of Norma Fiorentino on January 1, 2009, shortly after Cabot began ramping up operations to produce gas from the Marcellus Shale with the controversial practice of horizontal drilling and high volume hydraulic fracturing. Since then, the area has been the focus of a national controversy over the impacts of shale gas development on residential communities.

During my visit to the area this week, I noticed that a service rig at the Costello gas well had been removed. George Stark, a spokesman for Cabot, was not immediately available for comment about recent developments. Stark told me in September that the rig, which has been at the site for months, allowed crews to “monitor” the casing of the gas well, which appeared sound.

DEP officials explained it differently. They had not pinpointed a source for the problems affecting three homes near the well, including the Ely properties. But they had determined that the suspect Costello gas well was "unviable" and would have to be plugged. In an email response to my query earlier this fall, DEP spokeswoman Colleen Connolly reported that Cabot was ”continuing remedial efforts” at the Costello gas well and “evaluating the effectiveness” of the work.  Methane levels were fluctuating, she said. Additionally, tests had shown levels of iron and manganese that were elevated but within standards in some water samples. Elevated levels of these elements are “not uncommon during gas migration,” she reported.

Update 5:25 p.m. EST. In response to my request for an update this week, Connolly said in an email this afternoon that “remediation work” is continuing on the Costello 1 well.  But the department’s characterization of the status of the well remains vague. In Connolly’s words, the well is "essentially unviable," but DEP officials are "not aware of the gas well having been officially plugged.”