BEFORE THE OIL AND GAS CONSERVATION COMMISSION

OF THE STATE OF COLORADO

 

IN THE MATTER OF THE PROMULGATION AND

ESTABLISHMENT OF FIELD RULES TO GOVERN

OPERATIONS IN THE IGNACIO-BLANCO FIELD,

LA PLATA COUNTY, COLORADO

)

)

)

)

CAUSE NO.   112

 

ORDER NO.   112-213

 

REPORT OF THE COMMISSION

 

This cause came on for hearing before the Commission at 8:00 a.m. on July 15, 2008, in Ballroom B of the Brown Palace Hotel, 321 Seventeenth Street, Denver, Colorado, for an order to allow the Crader 3-3 Well to be drilled in the NE¼ of Section 3, Township 34 North, Range 9 West, N.M.P.M (NUL), within one and one-half miles of the outcrop contact between the Fruitland and Pictured Cliffs Formations, for production of gas from the Fruitland coal seams. 

 

FINDINGS

 

The Commission finds as follows:

 

1.     Chevron Midcontinent, L.P., (“Chevron”) as applicant herein, is an interested party in the subject matter of the above‑referenced hearing.

 

2.     Due notice of the time, place and purpose of the hearing has been given in all respects as required by law.

 

3.     The Commission has jurisdiction over the subject matter embraced in said Notice, and of the parties interested therein, and jurisdiction to promulgate the hereinafter prescribed order pursuant to the Oil and Gas Conservation Act.

 

4.  On June 17, 1988, the Commission issued Order No. 112-60, which among other things, established 320-acre drilling and spacing units for certain lands including Section 3, Township 34 North, Range 7 West, N.M.P.M., for production of gas from the Fruitland coal seams, with the permitted well to be located no closer than 990 feet to any outer boundary of the unit, nor closer than 130 feet to any interior quarter section line.

 

5.  On July 11, 2000, the Commission issued Order No. 112-156, which among other things, allowed an optional additional well to be drilled in certain 320-acre drilling and spacing units for production of gas from the Fruitland coal seams for certain lands, including the E½ of Section 3, Township 34 North, Range 9 West, N.M.P.M (NUL). In addition, the order required that a hearing would be held prior to the issuance of a drilling permit for a well located within one and one-half miles of the outcrop contact between the Fruitland and Pictured Cliffs Formations, to address potential adverse impacts to the Fruitland outcrop.

 

6.  On October 31, 2007, Chevron, by its attorney, filed with the Commission a verified application for an order to allow a well to be drilled in the NE¼ of Section 3, Township 34 North, Range 9 West, N.M.P.M (NUL), within one and one-half miles of the outcrop contact between the Fruitland and Pictured Cliffs Formations for production of gas from the Fruitland coal seams.  The purpose of the hearing is to address potential adverse impacts to the Fruitland outcrop.  

 

7.  On January 3, 2008, La Plata County filed with the Commission a Notice of Intervention to the application.

 

8.  On January 3, 2008, Chevron, by its attorney, filed with the Commission a written request to continue this matter to the May hearing, and the hearing in this matter was continued. 

 

9.  On May 27, 2008, Chevron, by its attorney, filed with the Commission a written request to continue this matter to the July hearing, and the hearing in this matter was continued. 

 

10.   On June 16, 2008, La Plata County, by its attorney, filed with the Commission a withdrawal of its intervention, which raised environmental and public health, safety and welfare concerns regarding the application, and were resolved by imposition of conditions agreed upon by La Plata County and Chevron, and the execution of a Memorandum of Understanding (“MOU”) between Chevron and La Plata County, dated June 3, 2008.

 

11.   On June 24, 2008, Chevron, by its attorney, filed with the Commission a written request seeking a variance under Rule 502.b. based on its belief that it is no longer necessary to have a formal hearing before the Commission as La Plata County’s intervention has been withdrawn due to the execution of the MOU and the conditions agreed upon for the drilling of the Crader 3-3 Well.  In addition, the COGCC staff has imposed conditions of permit approval to which Chevron has agreed.

 

12.  On July 8, 2008, the San Juan Citizens Alliance filed with the Commission a written statement under Rule 510. regarding their concern about approving the application before certain studies on the Fruitland outcrop have been completed.

 

13.  On July 14, 2008, Wallace White, La Plata County Commissioner, filed with the Commission a written statement under Rule 510. regarding the application, indicating that he was the dissenting vote on approving the MOU with Chevron at the La Plata County Board of County Commissioners’ meeting on June 3, 2008.

 

14.   At the July 15, 2008 hearing, Acting Director David Neslin described to the Commission the sequence of events surrounding this application and his justification for approving the variance request, unless the Commission wished to conduct a full hearing on the matter.

 

                        15.   A statement was made by Josh Joswick, representative for the San Juan Citizens Alliance in support of the written statement submitted under Rule 510.

 

                        16.  A statement was made by William Keefe, attorney for Chevron, in support of the request for a variance to be granted, allowing the Acting Director to approve the Application for Permit-to-Drill the Crader 3-3 Well without a hearing before the Commission.

 

17.  A motion was made by Commissioner Houpt to hold a hearing on the application, seconded by Commissioner Gerhardt, and after discussion among the Commissioners, denied by all the Commissioners except Commissioners Houpt and Gerhardt.

 

ORDER

 

NOW, THEREFORE IT IS ORDERED, that a variance under Rule 502.b. is hereby granted to Order No. 112-156 to allow the Application for Permit-to-Drill the Crader 3-3 Well, located in the NE¼ of Section 3, Township 34 North, Range 9 West, N.M.P.M (NUL), within one and one-half miles of the outcrop contact between the Fruitland and Pictured Cliffs Formations, for production of gas from the Fruitland coal seams, to be issued without the need for conducting a hearing.

 

IT IS FURTHER ORDERED, that the conditions developed by the COGCC staff and the conditions agreed to by Chevron and La Plata County shall be included as conditions of permit approval for the Crader 3-3 Well.

 

IT IS FURTHER ORDERED, that the well drilled in the above-described lands shall comply with certain provisions of the MOU between Chevron and La Plata County, and shall comply with all terms, conditions and provisions of prior Commission Orders in Cause No. 112, including without limitation, the specific provisions of Order No. 112-156 including the Rule 508.j.(3)B. conditions attached thereto, to the extent they do not duplicate the provisions of the MOU.  For convenience and ease of reference, the relevant conditions of the MOU and Order No. 112-156, including Rule 508.j.(3)B. conditions, are set forth below.  Conflicts between the conditions of the MOU set forth herein and the terms, conditions and provisions of Order No. 112-156 shall be resolved in favor of the MOU.

 

IT IS FURTHER ORDERED, that the following provisions of the MOU between Chevron and La Plata County shall be applied to additional wells where the surface location is proposed to be sited on lands subject to Commission jurisdiction, in addition to any requirements of applicable existing Commission Rules and Regulations or orders:

 

Surface Density  The density of Fruitland Coal Well Pads within the Infill Application Area shall not exceed two (2) within the existing drilling and spacing units of 320 acres for the Fruitland Coal Seam formation covering lands in La Plata County, Colorado.  Notwithstanding the foregoing, nothing contained in this provision shall be construed so as to require the closure or abandonment of any existing gas well.

 

Well Location; Exceptions  The Commission may grant a special exception allowing for a greater density of Fruitland Coal well pads (i.e., more than 4 per 640-acre section), at the request of Chevron and after consultation with the Local Governmental Designee, based upon a finding by the Commission that one or more of the following factors apply in a manner such that use of an existing well pad is rendered impractical:

 

a.   topographic characteristics of the site;

b.   natural resource constraints (e.g., wetlands);

c.   the location of utilities or similar services;

d.   geologic factors or where issues concerning distances between wells are present;

e.   other site conditions beyond the control of Chevron; or

f.    safety concerns.

 

Storm Water Management and Spill Prevention Containment and Control  Even if not required to do so by any applicable regulation or law, Chevron agrees to utilize best management practices for all pad expansions and new pads and for road and pipeline development or improvements.

 

Water Well Monitoring  If a conventional gas well exists within one quarter (¼) mile of the bottom hole location of a proposed Infill Well, then the two (2) closest water wells within a one-half (½) mile radius of the conventional gas well shall be sampled by Chevron as water quality testing wells.  If possible, the water wells selected shall be on opposite sides of the existing conventional gas well not exceeding one-half (½) mile radius.  If water wells on opposite sides of the conventional gas well cannot be identified, then the two (2) closest wells within one-half (½) mile radius shall be sampled.  If two (2) or more conventional gas wells are located within one quarter (¼) mile of the bottom hole location of the proposed Infill Well, then the conventional gas well closest to a proposed Infill Well shall be used for selecting wells for sampling.

 

If no conventional gas wells are located within one quarter (¼) mile radius of the bottom hole location of the proposed Infill Well, then the selected water wells shall be within one quarter (¼) mile of the bottom hole location of the proposed Infill Well.  In areas where two (2) or more water wells exist within one quarter (¼) mile of the bottom hole location of the proposed Infill Well, then the two (2) closest water wells shall be sampled by Chevron.  Ideally, if possible, the water wells selected should be on opposite sides of the bottom hole location of the proposed Infill Well.  If water wells on opposite sides of the bottom hole location of the proposed Infill Well cannot be identified, then the two (2) closest wells within one quarter (¼) mile radius shall be sampled by Chevron.  If two (2) water wells do not exist within one quarter (¼) mile radius, then the closest single water well within a one-half (½) mile radius shall be selected.

 

If no water well is located within a one quarter (¼) mile radius area or if access is denied, a water well within one-half (½) mile of the bottom hole location of the Infill Well shall be selected.  If there are no water quality testing wells meeting the foregoing criteria, then sampling shall not be required.  If the BLM or the COGCC have already acquired data on a water well within one quarter (¼) mile of the conventional gas well, but it is not the closest water well, it shall be given preference in selecting a water quality testing well.  The "initial baseline testing" described in this paragraph shall include all major cations and anions, TDS, iron and manganese, nutrients (nitrates, nitrites, selenium), dissolved methane, pH, presence of bacteria and specific conductance and field hydrogen sulfide.

 

If free gas or a methane concentration level greater than 2 mg/L is detected in a water quality testing well, compositional analysis and carbon isotopic analyses of methane carbon shall be performed to determine gas type (thermogenic, biogenic or an intermediate mix of both).  If the testing results reveal biogenic gas, no further isotopic testing shall be done.  If the carbon isotope test results in a thermogenic or intermediate mix signature, annual testing shall be performed thereafter and an action plan shall be drafted by Chevron to determine the source of the gas.  If the methane concentration level increases by more than 5 mg/L between sampling periods, or increase to more than 10 mg/L, an action plan shall be drafted to determine the source of the gas.

 

The initial baseline testing shall occur prior to the drilling of the proposed Infill Well.  Within one (1) year after completion of the proposed Infill Well, a "post completion" test shall be performed for the same parameters above and repeated three (3) and six (6) years thereafter.  If no significant changes from the baseline have been identified after the third test (the six year test), no further testing shall be required.  The testing schedule will restart after the drilling of a new Infill Well on an existing Well Pad if the wells to be tested include those tested for the 160-acre infill program.  Additional "post completion" test(s) may be required if changes in water quality are identified during follow-up testing.  The Director of the COGCC may require further water well sampling (which may include water quality monitoring) at any time in response to complaints from water well owners.

 

Within three (3) months of collecting the samples used for the test, copies of all test results described above shall be provided to the COGCC and the County and the landowner where the water quality testing well is located

                                                                  

Plugged and Abandoned Wells/Soil Gas Vapor Survey  A soil gas vapor-monitoring program is designed to determine a possible lack of zonal isolation along wellbores of plugged and abandoned wells.  Chevron will attempt to identify any plugged and abandoned wells located within 0.25 miles of the bottom hole location of any Infill Well.  Any plugged and abandoned well within 0.25 miles of the bottom hole of an Infill Well will be assessed for risk, taking into account cementing practices reported in the plugged and abandoned reports.  Chevron shall notify the COGCC of all results of all risk assessments of plugging procedures.  The COGCC may appropriate funds under Rule 701. (the Oil and Gas Conservation and Environmental Response Fund) to conduct soil gas monitoring tests to further define the risks.  If the monitoring reveals a possible lack of zonal isolation, the COGCC may then conduct or order any necessary remediation or other authorized activities.

 

It is further agreed by Chevron and La Plata County that all applicable regulations of the BLM, BIA and the Southern Ute Indian Tribe (“SUIT”) shall be complied with when conducting operations on lands subject such agency's jurisdiction as regards activity in this application.

 

IT IS FURTHER ORDERED, that the following terms, conditions and provisions of this Order No. 112-213 shall be applied to additional wells where the surface location is proposed to be sited on lands subject to Commission jurisdiction, in addition to any requirements of applicable existing Commission rules and orders:

 

Well Permit Limitations  A Commission hearing shall be required before a drilling permit may be issued for a well site located within one and one-half (1½) miles of the outcrop contact between the Fruitland and Pictured Cliffs Formations.  The purpose of the hearing shall be to address potential adverse impacts to the Fruitland outcrop.

 

Annual Drilling Plan  The Director shall survey the operator as to its drilling plans for 2008, and annually thereafter.  The survey results shall be reported to the Commission for its consideration with respect to the conditions attached to this order.

 

Wildlife  The operator shall notify the Colorado Division of Wildlife ("CDOW") of the location of any proposed additional well site and advise the Director of the date such notice was provided. If the Director receives comments from the CDOW within ten (10) days of the date notice was provided, such comments may be considered in applying Rule 508.j.(3)B. conditions in Exhibit A of Order No. 112-156.

 

Emergency Preparedness Plan  The operator submitting an Application for Permit-to-Drill for a proposed additional well under this order shall file and maintain a digital Emergency Preparedness Plan ("EPP") with La Plata County.  The EPP shall include as-built facilities maps showing the location of wells, pipelines and other facilities, except control valve locations that which may be held confidential. The EPP shall include an emergency personnel contact list.

 

Gas and Oil Regulatory Team  The Director shall ensure that the La Plata County Gas and Oil Regulatory Team ("GORT") continues to meet as appropriate, but no less than semiannually.  GORT meetings may be scheduled more frequently if the members believe a meeting is appropriate. (GORT includes invited member representatives from La Plata County, BLM, SUIT, industry operators and Commission. Its meetings are open and typically attended by interested area residents.)

 

3M Mapping, Modeling and Monitoring Project  The Director shall ensure that the 3M Technical Peer Review Team is invited to meet as appropriate, but no less than semiannually to review proposals and results related to the 3M Mapping, Modeling and Monitoring Project. 3M Technical Peer Review Team meetings may be scheduled more frequently if the members believe a meeting is appropriate.

 

Post Completion Pressure Build-Up Tests  In addition to obtaining a bottom hole pressure on all wells drilled under this order, the operator shall conduct pressure build-up tests two (2) to three (3) months after initial production begins and once every three (3) years thereafter.  The operator shall provide the data acquired, an evaluation of the data and the procedures utilized to conduct the pressure build-up tests to the Director within thirty (30) days of the conclusion of each test.  After reviewing the quality of the pressure buildup data and the adequacy of the geographic distribution of the data, the Director may reduce the number of wells for which pressure build-up testing is required.

 

IT IS FURTHER ORDERED, that the following Rule 508.j.(3)B. conditions from Order No. 112-156 shall be applied to additional wells where the surface location is proposed to be sited on lands subject to Commission jurisdiction, in addition to any requirements of applicable Commission rules and orders:

 

Prior to approving any Application for Permit-to-Drill, the Director shall conduct an onsite inspection if the surface well location is proposed to be sited within any subdivision that has been approved by La Plata County.  The Director shall conduct an onsite inspection if the surface well location is within two (2) miles of the outcrop contact between the Fruitland and Pictured Cliffs Formations and the surface owner, LGD, operator, or Director requests an onsite inspection.

 

Prior to approving any Application for Permit-to-Drill, the Director shall conduct an onsite inspection if the operator and the surface owner have not entered into a surface use agreement.  If the reason the surface use agreement has not been executed is related to surface owner compensation, property value diminution, or any private property contractual issues between the operator and the surface owner, then no onsite inspection shall be required.

 

The purpose of the onsite inspection shall be to identify any potential public health, safety and welfare or significant adverse environmental impacts within Commission jurisdiction regarding the proposed surface location that may not be adequately addressed by Commission rules or orders.  The onsite inspection shall not address matters of surface owner compensation, property value diminution, or any private party contractual issues between the operator and the surface owner.

 

When the Director conducts onsite inspections under the conditions described in the paragraphs above, the Director shall invite the representatives of the surface owner, the operator and LGD to attend.  The Director shall attempt to select a mutually acceptable time for the representatives to attend. The inspection shall be conducted within ten (10) days, or as soon as practicable thereafter, of either the date the LGD advises the Director in writing that the proposed surface well site location falls within an approved subdivision or the date the operator advises the Director in writing that a surface use agreement has not been reached with the surface owner.  If requested by the operator, the Director may delay the onsite inspection to allow for negotiation between the operator and surface owner or other parties.

 

Following the onsite inspection, the Director shall apply appropriate site specific drilling permit conditions if necessary to prevent or mitigate public health, safety and welfare or significant adverse environmental impacts taking into consideration cost-effectiveness and technical feasibility and relevant geologic and petroleum engineering conditions as well as prevention of waste, protection of correlative rights, and promotion of development.

 

Examples of the types of impacts and conditions that might be applied if determined necessary by the Director include (this list is not prescriptive or all inclusive):

 

Visual or aesthetic impacts - moving the proposed surface well site location or access road to take advantage of natural features for screening; installing low profile artificial lift methods; constructing artificial features for screening

 

Surface impacts – moving or reducing the size, shape, or orientation of the surface well site location or access road to avoid disturbance of natural features or to enhance the success of future reclamation activities; utilizing an existing surface well site location or access road to avoid the impacts of new construction; utilizing a closed drilling fluid system instead of reserve pits to avoid impacts to sensitive areas

 

Noise impacts – installing electric motors where practicable; locating or orienting motors or compressors to reduce noise; installing sound barriers to achieve compliance with Commission rules; confining cavitation completion operations (excluding flaring) to the hours of 7 a.m. to 7 p.m. and notifying all area residents within one-half (½) mile at least seven (7) days before cavitation is commenced

 

Dust impacts – watering roads as necessary to control dust during drilling and completion operations

 

Ground water impacts – collecting and analyzing water and gas samples from existing water wells or springs; installing monitoring wells, collecting samples, and reporting water, gas and pressure data

 

Safety impacts – soil gas sampling and analysis; residential crawl space gas sampling and analysis; installing security fencing around wellheads and production equipment

 

Outcrop impacts – performing outcrop gas seep surveys; performing produced water quality analysis; periodic pressure transient testing of high water/gas ratio wells; limiting water production in wells with anomalously high water rates and water/gas ratios; funding investigative reservoir modeling under the Director’s supervision

 

Wildlife impacts – limiting drilling and completion operations during certain seasonal time periods when specific site conditions warrant

 

If the operator objects to any of the conditions of approval applied above, the Director shall stay the issuance of the drilling permit and properly notice and set the matter for the next regularly scheduled Commission hearing at which time the Commission may determine conditions of drilling permit approval.

 

If the Director has reasonable cause to believe that any existing or proposed oil and gas operations are causing, or are likely to cause, public health, safety and welfare or significant adverse environmental impacts within Commission jurisdiction that may not be adequately addressed by Commission rules or orders, the Director may properly notice and set the matter for the next regularly scheduled Commission hearing to order appropriate investigative or remedial action.  Reasonable cause may include, but is not limited to, information from the 3M Mapping, Modeling and Monitoring Project.

 

IT IS FURTHER ORDERED, that, in addition to the above-described conditions, the following shall apply:

 

Chevron shall endeavor to install two (2) monitoring wells, one (1) located either in Section 6 or 8, Township 34 North, Range 9 West (North of Southern Ute Indian Line) and one (1) located in Section 4, Township 34 North, Range 9 West (North of Southern Ute Indian Line).  These wells shall be installed into the Fruitland Formation and perforated across the coal seams.  The proposed locations of these wells shall be discussed with and approved by the COGCC project manager for the La Plata County portion of the 4M Project.  A suite of logs shall be run, including gamma ray, bulk density, resistivity, caliper and spontaneous potential.  A sonic log will also be run to determine face and butt cleat orientation.  The wells shall be shut-in and static gradient pressure tests shall be performed in the wells on a monthly basis or the wells shall be equipped with two (2) pressure transducers, one to measure bottomhole pressure and one to measure wellhead pressure and an electronic data logger.  Pressure data shall be reported to the COGCC on a monthly basis.  The wells shall be blown down periodically, but at least once annually, and a meter shall be used to measure the rate and volume of the gas released.  At the conclusion of the blow down test, which shall be either after the well has blown down or after 24 hours of venting, a pressure measuring device shall be run in the well to measure bottomhole shut-in pressure and fluid level, if present.  The results shall be reported to the COGCC within one (1) month of the test.

 

Chevron shall conduct a detailed soil gas survey over the outcrop of the Fruitland Formation in Sections 4, 5, 6, 7, and 12, Township 34 North, Range 9 West (North of Southern Ute Indian Line), Section 33, Township 34.5 North, Range 9 West, and Section 26, 27, 33, and 34, Township 35 North, Range 9 West.  A grid-mapping system, such as that currently used for the outcrop monitoring required by Order Nos. 112-156 and 112-157 shall be used and shall include collecting gas measurements of methane, hydrogen sulfide, and carbon dioxide flux using a portable flux meter.  The locations of the measurements shall be accurately located using Global Positioning System technology.  This work is a stand alone requirement of this order, but the results shall also be incorporated into the annual report for the outcrop monitoring required by Order Nos. 112-156 and 112-157.

 

Chevron shall contribute a proportional share to the SUIT proposed “Angel Services Laser Flight” to conduct low altitude, high resolution aerial reconnaissance and image capture using a digital infrared camera (IR) capable of pinpointing areas of dead and stressed vegetation, to be conducted in coordination with the proposed additional pedestrian surveys of the entire Fruitland/Pictured Cliffs outcrop within the outcrop area.  The project would map methane, contour and measure methane flux rates across the outcrop. Chevron would fund the flyover portion of the outcrop from the north line of the Southern Ute Indian Reservation to at least Section 26, Township 35 North, Range 9 West (North of the Southern Ute line).  A detailed discussion of this technique is captured in the May 2006 LTE Study. The data obtained by Chevron and analysis of the data shall be provided to La Plata County and COGCC.

 

To define the extent of known or suspected gas seeps, Chevron shall use Temporary Monitoring Probes along the Basin Creek and Carbon Junction seeps to supplement the IR flyover and the COGCC pedestrian soil surveys and any additional seeps that may appear within the outcrop area.  The data obtained, and analysis of the data shall be provided to La Plata County and COGCC.

 

Chevron shall review the plugging and abandonment procedures for the Federal #34-1/2 34-1 Well (05-067-07514) located in SESE, Section 34, Township 34.5 North, Range 9 West (North of Southern Ute Indian Line) and assess the potential risk of this well to act as a conduit for migration of gas from the Fruitland Formation, taking into account cementing practices reported in the P&A report.  Chevron shall notify the Director of the results of the plugging and abandonment assessment.  The Director shall review the assessment and take appropriate action to pursue further investigation and remediation if warranted.  In addition, Chevron shall conduct a soil gas survey in the vicinity of the Federal #34-1/2 34-1 Well (05-067-07514) on an annual basis.  The results shall be reported to the COGCC within one (1) month of the survey.  If gas is detected in or around this well, then a gas sample shall be collected and submitted for compositional analysis and stable isotope analysis of the carbon and hydrogen of the methane.  The results of the soil gas survey shall be reported to the COGCC within two (2) months of the sample collection.

 

Chevron shall blow down the five (5) shut-in wells currently monitored by Chevron:  Day-V Ranch #1-35 Well (API 05-067-06894), State of Colorado #36-3 Well (API 05-067-07467), Day-V Ranch #35-2 Well (API 05-067-07494), Federal #34-1 Well (API 05-067-07615), and Day-V Ranch 34-½ #35-1 Well (API 05-067-07468).  During the blow down test a meter shall be used to measure the rate and volume of the gas released.  At the conclusion of the test, which shall be either after the well has blown down or after 24 hours of venting, a pressure measuring device shall be run in the well to measure bottomhole shut-in pressure and fluid level, if present.  The results shall be reported to the COGCC within one (1) month of the test.

 

Chevron shall develop a response and mitigation plan that shall be implemented should the seepage of methane gas increase along the outcrop of the Fruitland Formation in Sections 4, 5, 6, 7, and 12, Township 34 North, Range 9 West (North of Southern Ute Indian Line), Section 33, Township 34.5 North, Range 9 West, and Section 26, 27, 33, and 34, Township 35 North, Range 9 West in response to what is determined to be production from gas wells downdip from the outcrop.  The response and mitigation plan shall be developed by October 1, 2008 and reviewed on an annual basis and updated as deemed necessary based upon data collected during the previous year.  Complete copies shall be submitted to the COGCC and the La Plata County Emergency Management Coordinator.

 

As sufficient data are collected, Chevron shall calibrate the 2008 reservoir simulation model to confirm the prediction that infill drilling shall reduce gas seepage at the outcrop.  The first recalibration shall occur in January 2010.  The need for subsequent recalibrations shall be assessed at that time.

 

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.

 

                        IT IS FURTHER ORDERED, that under the State Administrative Procedure Act the Commission considers this order to be final agency action for purposes of judicial review within thirty (30) days after the date this order is mailed by the Commission.

 

                        IT IS FURTHER ORDERED, that an application for reconsideration by the Commission of this order is not required prior to the filing for judicial review.

 

                        ENTERED this__________day of July, 2008, as of July 15, 2008.

           

                                                                        OIL AND GAS CONSERVATION COMMISSION

                                                                        OF THE STATE OF COLORADO

 

 

                                                                        By____________________________________       

                                                                                    Patricia C. Beaver, Secretary

Dated at Suite 801

1120 Lincoln Street

Denver, Colorado 80203

July 23, 2008