Chesapeake delay contributed to Wyoming well blowout

NEW YORK Thu May 10, 2012 4:29pm EDT

Chesapeake Energy Corporation's 50 acre campus is seen in Oklahoma City, Oklahoma, on April 17, 2012.REUTERS/Steve Sisney

Chesapeake Energy Corporation's 50 acre campus is seen in Oklahoma City, Oklahoma, on April 17, 2012.

Credit: Reuters/Steve Sisney

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NEW YORK (Reuters) - Chesapeake Energy's delayed response to warning signs contributed to a natural gas well blowout in Wyoming in April, which led to a leak and the evacuation of dozens of nearby residents, state regulators said on Thursday.

The company's "delay in observation of and response to" drilling mud that had collected during the casing process, was a contributing factor in the eventual loss of control at the well, according to a Wyoming Oil and Gas Conservation Commission report.

It said that "improper engagement of wellhead lockdown pins" also helped cause the blowout, which was eventually triggered by a mechanical failure at the surface of the well.

No regulatory action was planned, the report said.

Chesapeake lost control of the well in Converse County on the afternoon of April 24 while installing a well casing, causing a leak of natural gas and drilling mud. A cloud of gas could be seen a mile from the well, emergency service officials said at the time.

Workers stemmed the leak by plugging the hole with drilling mud about three days later. The OGCC said that less than 2 million cubic feet of natural gas was leaked during the 66-hour incident.

The company declined to comment on the specific findings of the report. "Chesapeake continues to investigate the incident and is fully cooperating with WOGCC's review of this matter," it said in an emailed statement. No one was injured during the blowout.

The well has since been tested and operations resumed on May 4, the report said.

In April last year, Chesapeake had a blowout on a Pennsylvania well in the gas-rich Marcellus shale deposit. It took six days to bring under control and prompted a fierce backlash among area residents opposed to the drilling method known as hydraulic fracturing, or "fracking", in which water, sand and chemicals are pumped deep underground to release oil and gas trapped in the rock.

(Reporting by Edward McAllister and Selam Gebrekidan)

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