By Nicholas Kusnetz
Residents of Dimock, in northeastern Pennsylvania, said they were surprised -- and in some cases upset -- by the settlement that state environmental regulators reached last week with Cabot Oil & Gas, which the state Department of Environmental Protection says contaminated 18 water wells with methane from its gas-drilling operations.
The homeowners were told in September that the DEP was going to provide them with fresh water by building a pipeline from a nearby water treatment facility. A state infrastructure fund would have fronted the $11.8 million cost of the project, and the DEP was going to seek reimbursement from Cabot.
But last week, the DEP announced that the pipeline project was dead and that Cabot had agreed instead to give the homeowners $4.1 million and provide treatment systems for their well water. The 19 families who draw water from the wells will be offered payments equal to twice the value of their homes, with a minimum payment of $50,000. The settlement also gives the DEP $500,000 to cover the cost of the investigation.
Some of the residents are outraged by the change in plans, even though they say they will accept Cabot's offer.
"They destroy your life, your water, and for compensation they wave a little bit of money and expect you to take it and abandon your home," said Julie Sautner, who says her well was the first to be contaminated, in September 2008. "Just take the money and shut up. This is America, and I never expected this."
Ms. Sautner and several other homeowners filed a federal lawsuit against Cabot last year, seeking damages for their losses and a fund to cover the cost of any medical treatment that might be caused by the contamination. They also want to stop the company from any further drilling in the area. The new settlement is not expected to affect this separate civil suit. The affected area is about 30 miles north of Scranton.
Ms. Sautner said Cabot installed a treatment system in her home two years ago. She said she later disconnected it because it didn't work.
But Loren Salsman, who is not part of the lawsuit, said the methane separator Cabot installed at his house works fine. He said his well has always had methane, which sometimes occurs naturally in well water, but that the levels increased as a result of drilling in August 2009. He said he's not concerned about the methane, because it is not toxic and evaporates out of water.
"I was thrilled with the decision," Mr. Salsman said, speaking of the settlement.
George Stark, a Cabot spokesman, said the treatment systems the company is offering now are more sophisticated than those it installed in the past. He said the systems can be retooled based on the nature of a specific well's contamination to remove the methane as well as any other impurities that may be in the water.
Mr. Stark said he did not know how long the systems usually last, or whether Cabot will pay for maintenance or replacement if they don't work.
Michael Smith, a DEP spokesman, said in an e-mail that the department decided to settle with Cabot because there was "wide opposition" to the pipeline and it likely would never have been built.
A group of pro-drilling residents and business owners in the area, who started a campaign called Enough Already, organized a vocal opposition to the project, saying it was an intrusive solution that would jeopardize water supplies for the neighboring town of Montrose, where water for the pipeline would have come from. Some of the businesses that participated in the campaign work with Cabot. One, run by Guy Parrish, has been making water deliveries to the affected families in Dimock and will be installing the new treatment systems.
Eric Brunges, manager at Brunges Commercial Supply, said the group was "all for the people in Dimock having good water" but worried that the project would run over budget and that taxpayers would bear the costs.
Mr. Brunges said the group met with Cabot to get information about the pipeline, but received no money from the company and made its decisions independently.
Ms. Sautner said she will get about $250,000 from Cabot in the settlement. She said the county tax assessor's records say her home is valued at about $130,000, but that she recently got an independent assessment that valued it at around $190,000.
Residents say their land values have plummeted since the water became contaminated.
"There is no property value here no more," said Norma Fiorentino, whose well exploded on Jan. 1, 2009. Ms. Fiorentino said she'll be getting $228,928.
In November of last year, the DEP found Cabot responsible for polluting what the agency later determined to be 18 wells. It said faulty drilling practices allowed methane, the primary component of natural gas, to leak into the aquifer. Cabot did not agree with the department's findings, but agreed to fulfill the obligations laid out in the settlement.
Methane is not toxic but it can build up in wells and cause explosions.
The families have up to 85 days to decide whether to accept the offer. Those who decline have until Dec. 31, 2012, to change their minds. After that date, the money reverts to Cabot.
Nicholas Kusnetz (Nicholas.Kusnetz@propublica.org) writes for ProPublica, a nonprofit newsroom that produces investigative journalism (propublica.org).