Pa., Cabot reach settlement over methane contamination

Cabot Oil & Gas Corp. will pay $4.1 million to 19 families affected by methane contamination in what Pennsylvania Department of Environmental Protection Secretary John Hanger called the strongest financial settlement the department has ever obtained for families affected by environmental damage.

In exchange for Cabot's cooperation, in which each Dimock Township, Pa., family will receive twice the value of their home, the department is halting a plan to build a 12.5-mile waterline to supply the residents with uncontaminated water. Cabot will also pay the department $500,000 for its investigation into the contamination, according to a settlement announced yesterday.

Finally, Cabot will offer and pay for whole-house gas mitigation devices for each affected home.

"The 19 families in Dimock who have been living under very difficult conditions for far too long will receive a financial settlement that will allow them to address their own circumstances in their own way," Hanger said.

Some families, though, had been looking forward to the new waterline, which would have been paid for out of public funds. The state environment department has been investigating methane contamination in the residences' wells since January 2009 and traced it back to Cabot's operations. The company has denied that it is the source.

Cabot will be allowed to resume its drilling operations and plans to start up hydraulic fracturing again in the first quarter of 2011. Families will also be allowed to continue their lawsuit against Cabot alleging health and property damage (Laura Legere, Scranton [Pa.] Times Tribune, Dec. 16). -- AP

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