Anderson later mentioned the incident to some of his neighbors, though none became alarmed until the spring of 2001 when Mexican laborers cut into a 16-inch petroleum pipeline while digging a swimming pool in resident Brian Kibler's backyard. The pipe oozed thick black goo and reeked like a Texas City refinery.

Kibler frantically called neighbors Bernie Milligan, a 54-year-old private investigator, and Hank Williams, a 48-year-old chemical engineer, who sprinted over wearing sandals, shorts and tank tops then climbed onto the rebar inside the pit for a closer look. They observed a large oil sheen on the soil, and later complained their eyes and skin burned throughout the night even after washing -- symptoms consistent with exposure to raw crude oil. "It was like applying deep heat or Ben Gay," Milligan recalls.

As members of the neighborhood security committee, Milligan and Anderson used to talk surveillance cameras and speed bumps. Now they swapped details on the area's environmental past after long afternoons spent poring through dusty file boxes at the RRC's district office in the Heights.

Numerous residents reported petroleum hydrocarbons in the form of oily, black sludge bubbling to the surface of driveways...
Photos Courtesy of Miklyn Provenzano
Numerous residents reported petroleum hydrocarbons in the form of oily, black sludge bubbling to the surface of driveways...
...and yards after heavy rains.
Photos Courtesy of Miklyn Provenzano
...and yards after heavy rains.

By overlaying historical aerial maps from the 1950s, they discovered that nearly one-quarter of Woodwind Lakes -- or 150 homes -- was built atop a vast oil and gas field.

Fairbanks Oil Field, active from 1938 through the early 1970s, comprised 3,000 acres and several hundred wells that produced 42 million barrels of oil, state records show. Warren Petroleum Company, a division of Gulf Oil Corporation later acquired by ChevronTexaco, Inc., ran the Fairbanks Gas Processing Plant and the Ayers Compressor Station from the mid-1940s to 1966 on a total of 18 acres now within Woodwind Lakes.

Delroc Refineries, Inc., active from 1955Ė1957, comprised five acres and more than a dozen large bulk tanks that stored gasoline, natural gas, cracking stock and residual waste materials. Delroc operated a topping refinery, splitting crude oil for chemical manufacture and producing industrial fuels. The U.S. Environmental Protection Agency lists three dozen hazardous substances associated with this type of refinery, including arsenic, benzene, cyanide, mercury, PCBs, styrene, trichloroethylene, vinyl chloride and xylenes. Today 32 homes sit on the Delroc site.

Converting fields used for oil and gas exploration into residential areas is not uncommon in Houston and throughout the southeastern United States. But federal and state regulatory agency officials say the five-acre former Delroc site within Woodwind Lakes represents the only known residential development in Texas, and possibly the entire country, built on an old oil refinery. At any refinery site, oil is processed in such a way that hazardous chemicals are created as by-products.

"Typically when areas are used for industrial activities, they continue that way," says Jon Rinehart, a federal EPA site assistance manager for Texas and Louisiana. "You don't put housing developments on top of them."

In December 2003, nearly two dozen Woodwind Lakes homeowners sued oil and gas giants ChevronTexaco and Amerada Hess corporations; Chicago Title Insurance Company, the nation's largest title company; homebuilder Trendmaker Homes, a subsidiary of Washington-based Weyerhaeuser Real Estate Company; and Houston-based developer Lakeland Development Company. The case was severed into two separate lawsuits the following year.

The residents allege the developer, homebuilders and title company committed fraud, in violation of the state's Deceptive Trade Practices-Consumer Protection Act. They face an uphill battle getting their case before a jury since Texas tort reform law favors settling disputes between homebuilders and homebuyers in binding arbitration, which is notoriously pro-industry.

The homeowners argue that the arbitration clause in the purchase agreements they signed related only to construction defects, not environmental claims. But in January 2007, the 13th Court of Appeals in Houston ruled against them. Their attorneys requested a rehearing before the entire nine-member appeals court. If that fails, they will appeal to the Texas Supreme Court.

They already lost their suit against ChevronTexaco and Amerada Hess earlier this year. The Texas Supreme Court announced on February 2 it would not review the case. The residents claimed the oil and gas companies knowingly buried waste contamination in unlined pits on the property. Attorneys for the defendants successfully argued that the homeowners had "no standing" since the damage was done to the land before they bought it.

In the end, the 19 homeowners may have no legal recourse.

"Folks buying homes should be given the option of whether they want to become laboratory rats," says 37-year-old environmental trial lawyer Andrew Sher, who represents the plaintiffs. "The most significant investment of their lives is potentially worth nothing."

This month, the TCEQ plans to submit its assessment of the old Delroc refinery site to the EPA, which will determine whether it qualifies for the federal or state Superfund program. A final report will likely be issued this summer.

The five-acre site represents the most potentially lethal area in Woodwind Lakes. Benzene and ethylbenzene were found in shallow groundwater samples at elevated levels that could vaporize and migrate into the overlying houses, according to a February 2007 report released by the U.S. Department of Health and Human Services.

Bureaucratic incompetence held up the Superfund evaluation for an astounding two years as the RRC and the TCEQ squabbled over which state agency had jurisdiction.

The RRC, which regulates crude oil production, has supervised most of the environmental investigations at Woodwind Lakes. The TCEQ, which regulates the oil refining process, is responsible only for the Delroc site.

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