In Oklahoma, water, fracking - and a swarm of quakes

By Carey Gillam

NORMAN, Okla., Nov 19 (Reuters) - Seismologist Austin Holland wants to start an earthquake.

From his office a few feet below the earth's surface - a basement at the University of Oklahoma in Norman - Holland, who tracks quakes for the Oklahoma Geological Survey, is digging into a complex riddle: Is a dramatic rise in the size and number of quakes in his state related to oil and gas production activity? And, if so, what can be done to stop it?

As part of his wide-ranging research, Holland is proposing to inject pressurized water into porous rock in an area already known to be earthquake-prone, to see whether injections of oil industry wastewater are contributing to a "swarm" of earthquakes rocking the state.

"This is a dramatic new rate of seismicity," Holland said in an interview. "We can't guarantee the earthquakes aren't a coincidence (unrelated to oil and gas work)," he said. "But it would be a pretty remarkable coincidence."

Experts say billions of dollars could be at stake, as potential new regulations could affect the oil and gas industry's profits and as lawsuits by property owners with earthquake-related claims make their way through the legal system.

Oklahoma, the nation's fifth-largest oil-producing state, recorded 238 earthquakes through Nov. 18. More than 100 of those were at least a magnitude 3.0 on the Richter scale, tremors large enough to shake shelves and shred nerves.

One series of quakes in September near a newly opened injection well in the southern part of the state damaged several homes.

The quake activity is a far cry from four years ago when the state had but 20 rumblers of 3.0 and above. And from 1991 to 2008 there were no more than three quakes a year of that size in the state.

Since 2009, the volume of wastewater from oil and gas work injected deep into underground disposal wells has also risen, up about 50 percent in 2012 from the level seen during most of the first decade of the century, with the last couple of years showing the biggest jumps.

Most earthquakes occur naturally, but the increases in frequency and magnitude are distinct new elements, researchers say. While there are already many studies linking work at injection wells to earthquakes, Holland and other scientists are focusing on how the quakes are triggered and on measures to mitigate seismic activity.

The concern is not unique to Oklahoma. Since 2001 the average annual number of earthquakes of magnitude 3.0 or greater has jumped "significantly" across the midsection of the country, including not just Oklahoma but also Ohio, Arkansas and Texas, according to the U.S. Department of Interior.

In Arkansas, a group of homeowners who filed lawsuits against well operators alleged that their properties were damaged by a swarm of earthquakes that hit the central part of that state in 2010 and 2011. Scientists there blamed disposal wells for touching off more than 1,000 quakes in those years.

"Potentially billions of dollars are involved, from profits to class action lawsuits," oil industry analyst John Daly noted to clients recently. "Given the stakes, Holland's research will be closely watched not only by Oklahoma's oil and gas industry but producers throughout the U.S. as well."

The increasing number of large quakes has given fresh urgency to questions about whether the seismic activity is being induced by oil and gas production activities. Along with Holland, earthquake experts in Oklahoma, Texas, California, Arkansas and elsewhere are examining the issue. The federal government and the oil industry are funding some of the research.

Most earthquakes occur naturally. But scientists have long linked some small earthquakes to oil and gas work underground, which can alter pressure points and cause shifts in the earth.

Oil and gas exploration has increased in recent years across the country, spurred by U.S. efforts for energy independence. Modern hydraulic fracturing, or fracking, is one particularly controversial technique.

Fracking - which involves the injection of water, sand and chemicals under high pressure into bedrock to increase the flow of oil or gas - has been the culprit in some small earthquakes around the country. But it is not suspected as the cause of the bigger and more frequent quakes that have occurred recently, according to the Interior Department.

Disposal of the wastewater generated by fracking and by other types of oil and gas production is the "focal point" for research into what scientists call "induced" earthquakes.

The increase in earthquakes might be due in part to new drilling and well-completion technologies that enable the extraction of oil and gas from previously unproductive formations, according to William Ellsworth, a scientist with the U.S. Geological Survey's Earthquake Science Center.

In a report published in July, Ellsworth linked wastewater disposal to a 2011 Youngstown, Ohio, quake, and a series of earthquakes from October 2008 to May 2009 near Dallas, Texas.

Ellsworth also tied wastewater injection to a record-breaking 5.6-magnitude quake in Oklahoma in November, 2011, a tremor that damaged more than a dozen homes and several businesses.

The oil industry is not disputing the possibility of links, said Steve Everley, a spokesman for Energy In Depth, a website run by the Independent Petroleum Association of America. But only a handful of injection wells are actually associated with seismic events large enough to be felt, he said. Still, he said, the industry is paying attention to the new scientific findings.

"Sound research and good data can help inform the industry and improve its operations to further reduce risk," he said.

DO-IT-YOURSELF EARTHQUAKE

Holland's research primarily focuses on analyzing how seismic activity around the state correlates with injection volumes and the numerous fault zones underlying the region. But he is also drawing up a proposal that would create a small earthquake in the south-central part of the state.

That region was rattled by dozens of earthquakes in September, including one that registered 3.4 on the Richter scale, and the quakes began within two weeks of the startup of a new wastewater injection well there. Data showed that as the volume of pressurized wastewater injections grew, so did the seismic activity.

The well operator closed the well after regulators limited its volumes in response to the quakes, but Holland is seeking permission from regulators and the well operator to reopen the well and inject ever-greater amounts of wastewater while monitoring the seismic reaction. He hopes the work can help identify safe levels of injection and strategies to reduce risks for further earthquakes.

Regulators and the oil and gas industry say they welcome the research.

"Those people that live in areas that have been seismically active ... they are very concerned," said Matt Skinner, a spokesman for the Oklahoma Corporations Commission, which oversees the state's 11,000 injection wells.

Tom Dunlap, owner of the injection well Holland wants to use as the test site, said he welcomes Holland's proposal as a way to limit further earthquake risk.

"What our work does ... and how that plays into seismic stuff ... we don't know," Dunlap said.

(Reporting By Carey Gillam in Norman, Oklahoma; Editing by David Greising, Peter Henderson and Douglas Royalty)