Aug. 08–A recently re-filed lawsuit from Anadarko investors against the oil and gas company itself paints a picture of the 2017 Firestone explosion that killed two men as an inevitable accident with numerous warning signs that high-level executives ignored, allegedly in favor of profits.
The class-action suit was filed Friday in federal court, in the southern Texas district, by Robert Edgar on behalf of all Anadarko investors who held stock in the company between Feb. 8, 2016, and May 2, 2017, including Iron Workers District Counsel Philadelphia & Vicinity Union. It names not only Andarko Petroleum Corp., but also Chief Executive Officer R.A. Walker and Chief Financial Officer Robert Gwin as defendants.
The plaintiffs claim, with evidence laid out by nine anonymous former Anadarko employees and two anonymous former contractors, that it was a matter of time before a developer hit an unknown flowline in Weld County and caused dangerous gases to flood a home or neighborhood. The Colorado Independent also spoke to some of the same former employees for a May story.
Colorado Public Radio broke the story of the re-filed lawsuit Monday. Anadarko wouldn’t comment on the accusations in the lawsuit to CPR and did not return a request for comment in time for print Tuesday.
“Although there is a lot we would like to say at this time,” wrote Jennifer Brice, manager of corporate communications, in an email to CPR. “The appropriate path for us is to reserve our response for the court as part of the judicial process.”
Further, the plaintiffs allege, Anadarko executives flaunted Colorado Oil and Gas Conservation Commission rules related to health and safety to decrease company losses after the oil market bottomed out in 2014.
The Firestone well in question was drilled in 1993 and Anadarko acquired it and 1,500 other aging wells in a land swap with competitor Noble Energy in 2014, according to the complaint.
“Anadarko initially authorized a budget of tens of millions of dollars in order to either abandon them or bring them into current State compliance … After oil prices collapsed, Anadarko reconsidered its commitment to safety,” the plaintiffs allege. “It slashed the remediation budget. What was left of the budget was spent remediating Noble Wells that were either good producers or whose poor condition interfered with Anadarko’s drilling schedule. Anadarko did not consider safety threats in determining which few Noble Wells to remediate, even though many of these wells were located near houses or schools,” the suit continues.
Additionally, Anadarko allegedly did not know the location of the flowlines for the wells it had acquired from Noble. Plus, many of the mineral rights leases in the Weld County Wattenberg field area were negotiated years ago with a clause that said the company had to turn on and produce the wells to keep the lease.
According to one of the anonymous employees cited in the suit, “maintaining these old leases was a high priority for Anadarko. To maintain these lucrative leases, Anadarko had to turn on and produce with many of the wells it received from Noble in the Land Swap, even if these wells were in desperate need of repairs.”
The Noble wells that Anadarko received in the swap were significantly damaged from the 2013 flood, the lawsuit said. Additionally, the amount of new construction occurring in the Carbon Valley meant it was a matter of time before a flowline was severed.
“Because Anadarko wouldn’t know where to look to see if its flowlines and pipelines were severed and didn’t check to see if they were, an explosion was inevitable,” plaintiffs wrote. “Senior Colorado Anadarko executives were well aware of these safety issues. By November 2016, they had held several meetings specifically to discuss whether it was appropriate to ignore safety and focus on supporting drilling.”
Former Anadarko employees said that there were so few inspectors for Anadarko’s wells, that often inspectors only had five minutes to visually inspect a well and sniff for dangerous gases before driving to the next location.
The anonymous employees cited in the suit claim that the safety issues in Weld County were raised several times with top-tier executives at Anadarko, only to be ignored.
In March 2016, Anadarko laid off 20 to 30 percent of its staff in every division, which meant that staffing levels in Colorado fell to 1,000 by mid-2017 from a previous level of 1,500 employees.
According to two anonymous former employees, Anadarko then “‘ramped up’ its activity in Colorado. Indeed, Anadarko increased its count of well-drilling rigs in Colorado from one in August 2016 to five in November 2016. Yet Anadarko did not hire employees to do the additional work.”
The explosion and aftermath
On April 17, 2017, the home at 6312 Twilight Ave. in Firestone exploded, killing brothers-in-law Mark Martinez and Joseph Irwin III. Erin Martinez and her 11-year-old son were injured.
Investigations revealed that a severed flowline 7 feet beneath the home and 6 feet from the foundation had not been disconnected and capped. When the well was turned on, the flowline leaked odorless methane gas into the house, which exploded when Irwin and Mark Martinez tried to install a hot water heater.
The lawsuit alleges that Anadarko did not disclose the company’s role in the explosion until after the closing bell on the stock market April 26. Stock in the company fell 4.2 percent.
On May 2, the Firestone-Frederick fire department confirmed that a flowline from an Anadarko-owned well was to blame for the explosion. The next day, Anadarko stock fell another 7.7 percent, the lawsuit said.
“Following the explosion, Anadarko publicly expressed sympathy. Internally, however, Anadarko executives admitted that they were not concerned with the incident in which their reckless behavior caused two deaths,” the lawsuit alleges.
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