The Oil and Gas Conservation
Commission met on
Those
present were:
Brian
Cree Vice
Chair
John
Ashby Commissioner
Tom
Ann Casey Commissioner
Mike
Klish 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 January hearing.
Executive
Director’s Report: Shane Henry, DNR
Assistant Director stated that Russ George is the new Executive Director of the
Department of Natural Resources (“DNR”) and he is anxious to meet with the
Commissioners. Executive Director George
will be at the March hearing to introduce himself to the Commissioners. The Senate Agricultural confirmation hearing
went well for Vice Chair Cree and Commissioner Ashby. Mr. Henry has spent a great deal of time discussing
the Roan Plateau Plan with the Bureau of Land Management. The DNR pulled together the Department of
Wildlife (“DOW”), the Colorado Oil and Gas Conservation Commission (“COGCC”)
and State Parks to prepare the state’s comments on the Roan Plateau. Senator Isgar’s bill on pooling has been an
issue lately and yesterday he killed his own bill so that a work group can be
formed to discuss the ideas and reasons that initiated the bill.
Director’s Report: Deputy Director Macke provided a written
report and discussed the following: Thanks from COGCC staff to EnCana Energy
and Williams Production for the field tour.
Deputy Director Macke also thanked the Garfield County Commissioners and
staff for their participation in the Northwest Colorado Oil and Gas Forum and
the dinner on February 9th.
The COGCC appreciates its great working relationship with
COGCC Hearings Manager Tricia Beaver
described the Rocky Mountain Operating Company status report and updated the
Commissioners on the progress being made to identify a new operator, increase
the bond amount and get the fines paid. The
Commissioners agreed that the Director can grant a Rule 502.b. variance to the
compliance schedule once the Change of Operator, Form 10s and additional bond
money is provided to the COGCC. Hearings
Manager Beaver also described the staff proposed rulemaking. The Commissioners agree that the rulemaking
should be docketed for the April hearing.
Assistant
Attorney General’s Report: AAG Harmon
provided a written confidential litigation memo. She described the litigation between BDS and
Commissioner
Comments: On behalf of Chair Mueller,
Vice Chair Cree asked the Director about the status of the previously requested
shut-in well report. Commissioner Reagan
wanted to go on the record about the concern he has regarding financial
responsibility to the state from operators.
He agrees with Chair Mueller on the importance of the shut-in well
report. Commissioner Klish shares their concern
and wants to see the report.
Commissioner Ashby and Commissioner Shook also share this concern but do
not want to drive small business operators out of the state. Vice Chair Cree summarized by saying that the
entire Commission is concerned about the number of shut-in wells and wants it
addressed. COGCC Deputy Director Brian
Macke said the COGCC staff will put together more background data on the bond
claims. COGCC Operations Manager Morris
Bell will provide a report to the Commission on Environmental Response Fund
projects completed and proposed. Vice
Chair Cree clarified the Commission’s position on the Garfield County Energy
Advisory Board by reading two paragraphs from the memo from Director Griebling
to the Garfield County Commissioners.
Audience
Comments: Clem Mayer, boiler company
owner. Mr. Mayer had some kind words to
say about oil field workers.
Tresi
Houpt, Garfield County Commissioner, said Doug Dennison is in the process of
applying for Energy Impact Funds for air monitoring.
Kathy
Hall, COGA Western Slope Chapter, has worked for two state senators and just
finished two terms as a county commissioner for
Orlyn
Bell, property owner south of Silt, wanted to discuss MOU’s and proactive
versus reactive issues. Mr. Bell has
worked for the DNR as a Division Water Engineer. He said that a gas well went in several years
ago and used roads that about 12 private homeowners used. Mr. Bell worked with EnCana to establish an
MOU to address the concerns and issues of the 12 families and the gas
company. He would like there to be a
proactive approach regarding pipelines to help operators and surface owners
work together. Mr. Bell also wants to
see the Garfield County Energy Advisory Board go forward. He stated that things are going well with
EnCana now but who knows what will happen if there is a downturn in gas
prices. Mr. Bell thinks another look at
bonding is warranted. He would like
support from the COGCC on installing monitoring equipment.
Joel
Fox, EnCana Team Leader for Mam Creek, stated that EnCana is not in favor of
another regulatory group but has met with numerous landowners about their
concerns. Mr. Fox tried to provide facts
and data to the landowners. He is
willing to provide an entire technical team to address landowners’ concerns and
answer questions.
Cause
No. 407, Docket No. 0401-UP-01, request for an order to pool all non-consenting
owners in the 80-acre drilling and spacing unit consisting of the W½ SW¼ of
Section 34, Township 5 North, Range 67 West, 6th P.M. for the development and
operation of the Codell-Niobrara Formation, was withdrawn.
Cause
No. 407, Docket No. 0402-UP-02, request for an order to pool all non-consenting
owners in the 80-acre drilling and spacing unit consisting of the E½ SW¼ of
Section 34, Township 6 North, Range 67 West, 6th P.M. for the development and
operation of the Codell-Niobrara Formation, was withdrawn.
Cause
No. 300, Docket No. 0402-AW-01, request
for an order to allow up to four (4) wells to be drilled in the existing
160-acre drilling and spacing units located in certain sections of Township 2
South, Ranges 43 and 44 West, 6th P.M. and Township 3 South, Range 43 West, 6th
P.M. for production from the Niobrara Formation was continued to the March
hearing.
Cause
No. 318, Docket No. 0402-AW-02, request
for an order to allow up to three (3) wells to be drilled in the existing
160-acre drilling and spacing units located in Sections 25 through 28, Township
1 North, Range 45 West, 6th P.M. for production from the Niobrara Formation was
continued to the March hearing.
Cause No. 139, Docket No. 0402-AW-03, request for an
order to amend the 640-acre drilling and spacing units in Sections 30 and 31,
Township 7 South, Range 94 West, 6th P.M. and Sections 25, 26, 35 and 36,
Township 7 South, Range 95 West, 6th P.M. to allow 40-acre well density in those
lands for production from the Williams Fork Formation was removed from the
consent agenda because of concerns related to the Project Rulison site. After deliberations, the Commission expressed
safety concerns regarding drilling near Project Rulison and approved the
application with a requirement that for any wells proposed to be drilled within
one half (½) mile of the Austral Oil Hayward #25-95 (R-E) Well in Lot 11 of the
NE¼ SW¼ of Section 25, Township 7 South, Range 95 West, 6th P.M., a
hearing before the Commission should be held prior to approval of any
Application for Permit-to-Drill, Form 2.
Consent
Agenda: The Commission unanimously
approved all matters on the consent agenda, which included the following:
Cause No. 1V, Docket No. 0402-OV-05,
request to approve an Administrative Order by Consent finding Petroleum
Development Corporation in violation of Rule 303.a., failure to obtain the
COGCC Director's approval for its Application for Permit-to-Drill before
commencing operations with heavy equipment on the Chevron/Texaco #41C-13D Well
located in the SE¼ SE¼ of Section 12, Township 6 South, Range 97 West, 6th P.M.,
and assessing a fine of One Thousand ($1,000) dollars.
Cause No. 1V, Docket No.
0402-OV-06, request to approve an Administrative Order by Consent finding
EnCana Energy Resources, Inc. in violation of Rule 303.b., 301., and Section
34-60-117.(1) of the Oil and Gas Conservation Act, failure to have an approved
Application for Permit-to-Drill or Application for Permit-to-Recomplete to the
Dakota Formation, not providing written notice of intention to do work and to
protect correlative rights of all owners in every field or pool for the Owens
Brothers #13-32 Well located in the NW¼ SW¼ of Section 32, Township 3 North,
Range 67 West, 6th P.M., and assessing a fine of One Thousand ($1,000) dollars.
The
meeting adjourned at
====================================================================
The Secretary was therefore authorized to issue the
following orders:
Order No. 139-43, Rulison
Field, Garfield County: Approves
the request by Presco, Inc. for an order to amend the 640-acre drilling and spacing units in Sections
30 and 31, Township 7 South, Range 94 West, 6th P.M. and Sections 25, 26, 35
and 36, Township 7 South, Range 95 West, 6th P.M. to allow 40-acre well density
in those lands for production from the Williams Fork Formation, with a
requirement that for any wells proposed to be drilled within one half (½) mile
of the Austral Oil Hayward #25-95 (R-E) Well in Lot 11 of the NE¼ SW¼ of
Section 25, Township 7 South, Range 95 West, 6th P.M., a hearing
before the Commission shall be held prior to approval of any Application for
Permit-to-Drill, Form 2.
Order No. 1V-254, Garfield
County: Approves an Administrative Order by Consent finding
Petroleum Development Corporation in violation of Rule 303.a., failure to
obtain the COGCC Director's approval for its Application for Permit-to-Drill
before commencing operations with heavy equipment on the Chevron/Texaco
#41C-13D Well located in the SE¼ SE¼ of Section 12, Township 6 South, Range 97
West, 6th P.M., and assesses a fine of One Thousand ($1,000) dollars.
Order No. 1V-255, Weld
County: Approves an
Administrative Order by Consent finding EnCana Energy Resources, Inc. in
violation of Rule 303.b., 301., and Section 34-60-117.(1) of the Oil and Gas
Conservation Act, failure to have an approved Application for Permit-to-Drill
or Application for Permit-to-Recomplete to the Dakota Formation, not providing
written notice of intention to do work and to protect correlative rights of all
owners in every field or pool for the Owens Brothers #13-32 Well located in the
NW¼ SW¼ of Section 32, Township 3 North, Range 67 West, 6th P.M., and assesses
a fine of One Thousand ($1,000) dollars.
_________________________________
Patricia
C. Beaver, Secretary
Approved:
__________________________________