PA Court: Rule of Capture Does Not Apply to Hydraulic Fracturing

April 9, 2018

On April 2, the Pennsylvania Superior Court held that hydraulic fracturing that results in the extraction of natural gas from adjoining land may constitute a claim for trespass.

In Briggs v. Southwestern Energy Production Company, 2018 PA Super 79 (Apr. 2, 2018) , Defendant Southwestern Energy Production Company utilized the hydraulic fracturing method to extract natural gas through a well on land adjacent to the Plaintiffs’ property, for which the company did not have a lease. As a result, the Briggs family filed a complaint asserting claims of trespass and conversion. Cross-motions for summary judgment eventually were filed, and the trial court granted Southwestern’s motion, agreeing that the rule of capture applied and precluded recovery by the Plaintiff-landowners. The case turned on whether fracturing fluid and proppant crosses the imaginary horizontal plane of the subsurface of a property boundary.

On appeal, the Superior Court reiterated Pennsylvania’s recognition of the rule of capture, but acknowledged that the rule’s application to hydraulic fracturing was an issue of first impression in the commonwealth. For guidance, the court looked to the only other cases to have addressed this issue, Coastal Oil & Gas Corp. v. Garza Energy Trust, 268 S.W.3d 1 (Tex. 2008), and Stone v. Chesapeake Appalachia, LLC, No. 5:12-CV-102, 2013 WL 2097397 (N.D.W.Va. Apr. 10, 2013), order vacated, 2013 WL 7863861 (N.D.W.Va. July 30, 2013). The Pennsylvania court agreed with the rationale in the Stone decision and Coastal’s dissent that, given the practical differences between conventional methods of extraction and hydraulic fracturing and between the respective positions of oil and gas producers and landowners, the rule of capture did not protect oil and gas producers employing the hydraulic fracturing method.

Adopting this line of reasoning, the Superior Court held that, in Pennsylvania, “the rule of capture does not preclude liability for trespass due to hydraulic fracturing. Therefore, hydraulic fracturing may constitute an actionable trespass where subsurface fractures, fracturing fluid and proppant cross boundary lines and extend into the subsurface estate of an adjoining property for which the operator does not have a mineral lease, resulting in the extraction of natural gas from beneath the adjoining landowner’s property.” The court remanded the case to determine whether Southwestern’s operations had in fact resulted in a subsurface trespass to the Plaintiffs’ property.

Trespass litigation likely will increase with the Briggs decision, as an issue once framed for summary judgment based on the rule of capture is now fodder for fact-intensive discovery and expert opinions regarding the subsurface migration of fracturing fluid and proppant.