Can a Saltwater Waste Disposal Well Cause Subsurface Trespass?

The Texas Supreme Court will again review this issue in a case between a waste injection well operator, Environmental Systems, L.C., (“EPS”) and the adjacent landowner, FPL Farming Ltd., (“FPL”). FPL alleges that EPS’s waste water from its injection well migrated into the subsurface of FPL’s adjoining land. As a result, the aquifer below FPL’s land is now tainted and can no longer be used as a water source for FPL’s farming operations. The Court conducted oral argument in January, 2014 and a decision is expected later this year.

The issue many people in the oil and gas industry are closely watching is whether the Court will recognize a cause of action in trespass for deep subsurface water migration. The Texas Railroad Commission has issued more than 50,000 permits for oil and gas injection and disposal wells. The implications of this decision could impact thousands of businesses and landowners.

EPS argues that Texas does not recognize a claim for trespass to protect possessory rights at the depths that are at issue in this case. On the other side, FPL argues that Texas law recognizes that a landowner owns the water below his land, and does not distinguish between ownership of fresh underground water and deep subsurface saltwater formations.

Back in 2009, the trial court determined that no trespass had occurred. On appeal, the Beaumont Court of Appeals initially held that EPS was shielded from trespass liability because the state agency authorized its deep subsurface injections. The Texas Supreme Court disagreed and remanded the case back to the Court of Appeals. On remand, the Court of Appeals held that FPL had a common law subsurface trespass cause of action against the operator EPS. The Texas Supreme Court granted a petition for review on November 22, 2013.