BEFORE THE OIL AND GAS CONSERVATION COMMISSION

OF THE STATE OF COLORADO

 

IN THE MATTER OF ALLEGED VIOLATIONS OF THE            )     CAUSE NO. 1V

RULES AND REGULATIONS OF THE COLORADO OIL         )

AND GAS CONSERVATION COMMISSION BY                        )     ORDER NO. 1V-252

PEASE OIL & GAS COMPANY,                                                 )          

(a.k.a. REPUBLIC RESOURCES INC.)                                     )

LOGAN COUNTY, COLORADO                                              )     

 

ADMINISTRATIVE ORDER BY CONSENT

 

FINDINGS

 

1.      On July 27, 1973, Colorado Oil and Gas Conservation Commission (“COGCC”) staff approved the Application for Permit to Use Earthen Pit, Form 15 submitted by A.T. Skaer (“Skaer”) for the Schwartz #1 lease located in the NE¼ NE¼ of Section 28, Township 3 South, Range 50 West, 6th P.M.

 

2.      In June of 1992, the Schwartz #1-X Well located in the NE¼ NE¼ of Section 28, Township 3 South, Range 50 West, 6th P.M. was drilled and completed by Skaer Enterprises, Inc (“Skaer”).  The well was drilled as a replacement to the Schwartz #1 Well which had collapsed casing.

 

3.      On October 18, 1994, the Colorado Oil and Gas Conservation Commission (“COGCC”) approved the Certification of Clearance and/or Change of Operator, Form 10 from “Skaer” to Pease Oil & Gas Company (“Pease”) with an effective date of March 1, 1994.

 

4.  On April 22, 1997, the Schwartz #1-X Well was plugged and abandoned by Pease.

 

5.  On May 5, 1999, a Sundry Notice, Form 4 from Pease was received by the COGCC stating that final reclamation was completed and the site was ready for inspection.

 

6.   On June 7, 1999, COGCC staff received a letter from Pease dated June 3, 1999 indicating that the pits at the Schwartz #1-X facility were closed and reclaimed prior to December 31, 1997.

 

7.   On October 2, 2000 COGCC staff conducted a field inspection of the site.  Oily soils, asphaltic material, and power poles remained on location. 

 

8.   On October 6, 2000, a Notice of Alleged Violation (“NOAV”) was issued to Pease for incomplete reclamation and oil impacted soils.  The NOAV cited Rule 906.d.(2), for remediation of spills/releases to meet the allowable concentrations in Table 910-1; Rule 907.a., for failure to ensure that E&P waste is properly stored, handled, transported, treated, recycled or disposed to prevent threatened or actual significant adverse environmental impacts; Rule 909.e., indicating that remediation and reclamation shall be complete upon compliance with the allowable concentrations in Table 910-1 or upon compliance with an approved workplan; and, Rule 1004 for incomplete final reclamation.  Corrective action included the requirement for Pease to submit a Form 27 by November 30, 2000.

 

9.   On April 3, 2001, COGCC environmental staff conducted a field inspection of the site.  Four soil borings were hand augered to a maximum depth of seven feet below surface in the former pit area.  Two of the borings encountered oily soil and representative soil samples were collected and submitted for analyses.  Laboratory results of one soil sample indicated a Total Recoverable Petroleum Hydrocarbon (“TRPH”) concentration at 17,000 milligrams per kilogram (mg/kg). This exceeds the COGCC Allowable Concentrations for Organics in Soils for non-sensitive areas at 10,000 mg/kg.

 

10.  On April 26, 2001, COGCC staff sent a letter to Pease with the laboratory results and requiring a Form 27 be submitted to the COGCC by May 31, 2001.

 

11.  On May 29, 2001, a Form 27 was received by the COGCC.

 

12.  On June 11, 2001, COGCC environmental staff conditionally approved the workplan.

 

13.  On July 12, 2001, H&R Well Services (“H&R”), under contract to Pease, began remedial operations as per the approved workplan.  From July 12–27, 2001, H&R excavated and removed in excess of 1,500 cubic yards of oil impacted soil to the Washington County Landfill for disposal and further handling.

 

14.  On July 16, 2001, COGCC staff received notification of a corporate name change from Pease Oil & Gas Company to Republic Resources Inc. (“Republic resources”) effective July 11, 2001.

 

15.  On March 11, 2002, COGCC environmental staff conducted a field inspection of the site.  Oily soils remained at the wellhead and tank battery locations.

 

16.  From May 3-7, 2002, H&R excavated and removed an additional 46.8 tons of oil impacted soils to the Washington County Landfill for disposal and further handling.

 

17.  On January 28, 2003, COGCC environmental staff conducted a field inspection of the site.  Oily soil remained at the former tank battery location.  A representative soil sample was collected and submitted for analyses.  Laboratory results indicated a TRPH concentration at 14,000 mg/kg.  This exceeds the COGCC Allowable Concentrations for Organics in Soils for non-sensitive areas at 10,000 mg/kg.

 

18.  On March 31, 2003, COGCC staff sent correspondence to Republic Resources with the soil sample results and an abbreviated chronology of events.  The letter stated that additional remediation and reclamation is required at the site.  The letter also required a revised Form 27 to be submitted to the COGCC for approval by April 30, 2003.

 

19.  On April 9, 2003, COGCC staff received a request for an extension for the submittal of the revised Form 27 from April 30, 2003 to May 15, 2003.  The extension was granted by COGCC staff on April 9, 2003.

 

20.  On May 8, 2003, the COGCC received a facsimile of correspondence from Republic Resources dated May 7, 2003.  The letter stated that Republic Resources is out of funds and is unable to do any additional remediation and/or reclamation at this site.  The letter suggests that remedies be pursued that may be available under the bond for cleanup of the site.

 

21.  Republic Resources did not submit the revised Form 27 by the extended deadline of ay 15, 2003.

 

22.  COGCC staff has estimated the additional remediation and reclamation costs for this site at approximately Ten Thousand dollars ($10,000).  Republic Resources has stated that it has no funds available for the remediation and reclamation of the site.

 

23.  Failure to perform the required remediation and reclamation of the site is a continuing violation of Rules 906.d.(2), 909.e., and 1004. by Republic Resources.

 

24.  Republic Resources does not have the financial resources to complete the work required to bring the site into compliance.

 

25.  A monetary penalty of One Thousand dollars ($1,000.00) should be assessed against Republic Resources for the continuing violation of Rules 906.d.(2), 907.a., 907.e, and 909.e, and 1004 in accordance with Rule 523.a.  The base fine for any of these violations is One Thousand dollars ($1,000.00).

 

26.  The Commission should claim the Pease Oil & Gas Company’s blanket plugging bond to remediate the site to meet the COGCC Allowable Concentrations and Levels for Organics in Soil in Table 910-1 and to reclaim the site to rangeland.

 

ORDER

 

            NOW, THEREFORE IT IS ORDERED, that Republic Resources Inc. shall be found in continuing violation of Rules 906.d.(2), 909.e., and 1004 for failure to remediate spills/releases to meet the allowable concentrations in Table 910-1 and for failure to complete the remediation of impacted soils and reclamation at the former Schwartz #1-X tank battery located in the NE¼ NE¼ of Section 28, Township 3 South, Range 50 West, 6th P.M.

 

                        IT IS FURTHER ORDERED, that Republic Resources Inc. shall be assessed a total fine of One Thousand dollars ($1,000.00) for the violations, payable within thirty (30) days of the date the order is approved by the Commission.

 

                        IT IS FURTHER ORDERED, that the Commission shall make a claim on the Pease Oil & Gas Company’s blanket plugging bond to remediate the site to meet the COGCC Allowable Concentrations and Levels for Organics in Soil in Table 910-1 and to reclaim the site to rangeland.

 

                        IT IS FURTHER ORDERED, that the provisions contained in the above order shall become effective forthwith.

 

                        IT IS FURTHER ORDERED, that the Commission expressly reserves its right after notice and hearing, to alter, amend, or repeal any and/or all of the above orders.

 

                        RECOMMENDED this                  day of October, 2003.

 

                                                 OIL AND GAS CONSERVATION COMMISSION

                                                                          OF THE STATE OF COLORADO

 

                                                                          By                                                                             

                                                                        Morris Bell, Hearing Officer

 

Dated at Suite 801

1120 Lincoln St.

Denver, Colorado 80203

October 3, 2003

  

                        AGREED TO AND ACCEPTED this _________day of October, 2003.

                                                                                                                                                 

 REPUBLIC RESOURCES INC.

(a.k.a. PEASE OIL AND GAS COMPANY)

                                                                  

By ____________________________________________

 

                                                          

Title ___________________________________________