April 21, 2003

 

            The Oil and Gas Conservation Commission met on April 21st at 10:00 a.m. in the Council Chambers, Arvada City Hall, 8101 Ralston Road, Arvada, Colorado, for a hearing in Cause Nos. 1V, 133 (2 matters) 146, 191, and 139, 440, 479, 495, and 510.

           

            Those present were:

 

                        Stephen Sonnenberg              Chair

                        Brian Cree                               Vice Chair

                        Tom Ann Casey                      Commissioner

                        Michael Klish                           Commissioner

                        Peter Mueller                           Commissioner

                        Tom Reagan                           Commissioner

                        Lynn Shook                             Commissioner

                        Carol Harmon                         Assistant Attorney General

                        Richard Griebling                    Director

Brian Macke                            Deputy Director

                        Patricia Beaver                       Hearings Manager

                       

            The Commission unanimously approved the minutes from the March 17, 2003 hearing.

 

Executive Director’s Report:  There was no report.

 

            Director’s Report:  Director Griebling provided a written report and discussed the following: The Southeast Colorado Raton Basin report will be on the Colorado Oil & Gas Conservation Commission (“COGCC”) website and published in the Oil & Gas Journal.  A presentation on the report will be made to the Commissioners in August.  The backlog of statistics entry for production reports is getting caught up, thanks to COGCC staff Diana Fairlamb and Carol Rensel.  A presentation was made to The Joint Agricultural Committee by COGCC staff engineer Dave Dillon along with the Water Quality Control Division and the Division of Water Resources on April 16 to discuss waster issues in the Raton Basin.  They did a great job.  The information related to COGIS in the staff report has been updated to reflect the COGCC website layout.  The General Section of the COGCC website has weekly and annual statistics available.  There has been one variance under Rule 502.b. approved since the March hearing.

 

Assistant Attorney General’s Report:  AAG Harmon provided the Commissioners with a litigation memo.  There was no additional report.

 

Commissioner Comments:  Commissioner Casey suggested that a presentation from CDX on their horizontal drilling program be made at the June hearing in Cortez.  Chair Sonnenberg will not be at the June hearing, so Vice Chair Cree will need to preside over the hearing.  Chair Sonnenberg also announced he will not seek reappointment to the Commission.

 

Audience Comments:  There were no comments.

 

Cause No. 517, Docket No. 0302-GA-01, request for a variance to allow the Kildare 42-20 Well to be located closer than 150 feet from the surface owner’s property, was continued to the June hearing pending a settlement between the parties.

 

Cause No. 1V, Docket No. 0304-OV-04, request to enter an Order Finding Violation finding Fredrick J. Shaffer Jr. in violation of Rule 326.b.(1) for failure to either perform a mechanical integrity test, produce, or plug and abandon the State-Pyle #1 Well located in the NW¼ SE¼ of Section 6, Township 20 South, Range 48 West 6^th P.M. and the State-Pyles-Calvert #1 Well located in the SW¼ NE¼ of Section 11, Township 20 South, Range 49 West, 6^th P.M.  After testimony was presented by CGOCC staff engineer Dave Dillon in support of the staff recommendation to find Shaffer in violation, the matter was unanimously approved.

 

Cause No. 146, Docket No. 0304-GA-02, request for an order authorizing the closure of the Leyden Underground Natural Gas Storage Facility in the caverns of the abandoned Leyden Coal Mine.  The Commission was given a field site tour prior to the hearing.  AAG Harmon reviewed with the Commissioners the statute governing the closure of underground natural gas storage facilities and the conditions to be applied to any order.  Bill Uding, Public Service Company Engineer, made a presentation on the history of the Leyden facility and the proposed closure plan.  Public comments were made under Rule 510., by the following: 

Jean Tate, President of El Dorado Estates – Concerned about the facility being closed in an environmentally sound manner to properly protect safety.  Concerned about how much data was being collected, if any.  Concerned with the water around the area.  Stated there are active springs in the area even during the drought and wondered what would happen to the spring flow in the area.  Wants full disclosure of the information concerning the area.  Provided Commissioners with a list of questions she would like answered.

 

David Rleisky, Homeowner – Concerned about long term protection of home values and safety.  Wondered about where the water and gas would go after closure.  Believes that the ground water will change with the injection and storage of water.  Wants to be sure that Public Service posts financial assurance to take care of any problems to existing and future homeowners.

 

Anna May Doyle, has lived in Arvada since 1990 – Discussed previous reports and court cases.  Concerned about the pressure when flooding the mine and where the gas will go.  Believes a full and complete examination of data is needed.   Wants financial assurance to be required to ensure public health and safety.

 

Chris Eatherton – Discussed a few of the wells drilled in the area, including depths and how many homes are in the area.  Has obtained leak survey data that doesn’t cover the entire area. Believes data is being withheld by Public Service.  Wasn’t aware that the Leyden facility was there when he purchased his home and is thinking of selling it due to the proximity of the facility.

 

Mark Floyd, Project Engineer for City of Arvada – A letter of support was provided by the City Manager.  The City of Arvada recognizes the benefit that the Leyden facility has provided and appreciates that Public Service has realized that the facility is no longer compatible with surrounding use.  Believes that partnering with Public Service to use the cavern will save money for the citizens.  It appears that there will be water to inject this year and construction of facilities to begin injection in September will be needed.

 

John David Duran – Concerned that injection and withdrawal of water will cause subsidence.

 

Procedural items were discussed as follows:

 

2 requests for a continuance to July by Public Service and El Dorado Estates - hearing continued to July.

1 request for a continuance to August by Union Pacific - hearing continued to July.

2 requests to visit additional site on the field tour by Protestants Union Pacific and El Dorado Estates - sites visited immediately following hearing.

Requests for Discovery by Union Pacific and El Dorado Estates - Commissioner Peter Mueller appointed Hearing Officer for the matter.

Request to set case management - Commissioner Mueller appointed Hearing Officer for the matter.

Discussion on whether Jefferson County Department of Health and Environment (JCDHE) should be an intervenor.  Roy Laws decided JCDHE should not to intervene and participated by giving a Rule 510 Statement as follows:

 

Roy Laws, Environmental Engineer for JCDHE – Wants to be a part of the decision making process.  Wants a subsidence assessment report and gas migration report.  Wonders if the gas will cause any future problems and wants to be sure that the data properly supports the data.   Believes that a monitoring system should be installed in homes and buildings such as seismic monitoring. 

 

Upon conclusion of the hearing, the Commission reconvened at the Leyden Station for another field tour of sites requested by the Protestant to be visited.  The hearing to present the technical data in this matter was continued to the July hearing.  A prehearing conference was scheduled for 10 a.m. on Tuesday, April 22 at the COGCC conference room, with Commissioner Mueller presiding as Hearing Officer.

 

Consent Agenda:  The Commission unanimously approved all matters on the consent agenda, except the Williams matter, which included the following:

 

Cause No. 191, Docket No. 0304-SP-03, request for an order to vacate the 640-acre drilling and spacing unit consisting of Section 35, Township 6 South, Range 92 West, 6^th P.M. for production of gas and associated hydrocarbons from the Mesaverde Formation.

 

Cause No. 133, Docket No. 0304-AW-04, request for an order to allow up to four (4) wells to be drilled and completed at the option of the operator on 320-acre drilling and spacing units in Section 26 and the N½ of Section 36, Township 12 North, Range 101 West, 6^th P.M. for the production of gas and associated hydrocarbons from the Wasatch, Fort Union, Lance, and Lewis Formations.

 

Cause No. 133, Docket No. 0304-AW-05, request for an order to allow up to five (5) wells to be drilled in existing 320-acre drilling units established in Section 30, Township 12 North, Range 100 West, 6^th P.M. and Section 25, Township 12 North, Range 101 West, 6^th P.M. for the production of gas and associated hydrocarbons from the Wasatch, Fort Union, Lance and Lewis Formations.

 

Commissioner Mueller recused himself from the following matter, which was approved by the rest of the Commission:  Cause Nos. 139, 440, 479, 495, 510, Docket No. 0304-AW-03, request for an order to allow additional wells to be drilled on ten (10) acre density directionally from 40-acre well sites or previously approved 20-acre well sites for certain lands in Township 6 South, Ranges 94-96 West, 6^th P.M., and Township 7 South, Ranges 95 and 96 West, 6^th P.M. for the production of gas and associated hydrocarbons form the Williams Fork Formation.

 

The meeting adjourned at 3:20 p.m., reconvened at 4:00 p.m. for a second field tour and adjourned at 5:00 p.m.

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            The Secretary was therefore authorized to issue the following orders:

 

Order No. 133-20, Hiawatha West Field, Moffat County:  Approves the request by Wexpro Company to allow up to five (5) wells to be drilled in existing 320-acre drilling units established in Section 30, Township 12 North, Range 100 West, 6^th P.M. and Section 25, Township 12 North, Range 101 West, 6^th P.M. for the production of gas and associated hydrocarbons from the Wasatch, Fort Union, Lance and Lewis Formations.

 

Order No. 133-21, Hiawatha West Field, Moffat County:  Approves the request by Ensign Operating Company to allow additional wells to be drilled in certain 320-acre drilling and spacing units in Section 32 and the N½ of Section 33, Township 10 North, Range 93 West, 6^th P.M. for the production of gas and associated hydrocarbons from the Middle Lewis Formation.

 

Order No. 191-7, Mam Creek Field, Garfield County:  Approves the request by Calpine Natural Gas Company to vacate the 640-acre drilling and spacing unit consisting of Section 35, Township 6 South, Range 92 West, 6^th P.M. for production of gas and associated hydrocarbons from the Mesaverde Formation.

 

Order Nos. 139-38, 440-23, 479-11, 495-3, 510-8, Parachute and Grand Valley Fields, Garfield County:  Approves the request by Williams Production RMT Company to allow additional wells to be drilled on ten (10) acre density directionally from 40-acre well sites or previously approved 20-acre well sites for certain lands in Township 6 South, Ranges 94-96 West, 6^th P.M., and Township 7 South, Ranges 95 and 96 West, 6^th P.M. for the production of gas and associated hydrocarbons form the Williams Fork Formation.

 

Order No. 1V-245, Kiowa County:  Approves the Order Finding Violation finding Frederick J. Shaffer Jr. in violation of Rule 326.b.(1) for failure to either perform a mechanical integrity test, produce, or plug and abandon the State-Pyle #1 Well located in the NW¼ SE¼ of Section 6, Township 20 South, Range 48 West 6^th P.M. and the State-Pyles-Calvert #1 Well located in the SW¼ NE¼ of Section 11, Township 20 South, Range 49 West, 6^th P.M. and assesses a fine of Four Thousand dollars ($4,000).

 

                                                                                                           

Signed:

Patricia C. Beaver, Secretary

 

Approved:

Stephen Sonnenberg, Chair