REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on January 18, 1996, at 8:30 a.m., in Suite 801, The Chancery Building, 1120 Lincoln Street, Denver, Colorado, after giving Notice of Hearing as required by law, on why Tandem Oil Company was not in violation of, Rule 902.e., oil on pits for more than twenty-four (24) hours; Rule 902.f., failure to fence and/or net a pit; and Rule No. 907.a., failure to properly remediate an oil spill, of the Oil and G as Conservation Commission, and why it should not invoke the provisions of 34-60-121 C.R.S., as amended, providing for penalties for violations of the Rules and Regulations of the Commission.

FINDINGS

The Commission finds as follows:

1. Tandem Oil Company 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.

4. On September 2, 1995, Federal Agents from the U.S. Fish and Wildlife Service inspected the Marick State No. 1 Well located in the NW1/4 SE1/4 of Section 3, Township 3 South, Range 52 West, 6th P.M., and found oil inside the tank berm, the evaporation pit completely covered with oil, and two dead waterfowl. The Agents contacted COGCC staff regarding the situation.

5. On September 19, 1995, COGCC staff conducted a production site inspection on the Marick State No. 1 Well, operated by Tandem Oil Company, and found numerous violations, including: Rule No. 902.e., oil on pits for more than twenty-four (24) hours; Rule 902.f., failure to fence and/or net a pit; and Rule No. 907.a., failure to properly remediate an oil spill. At this time, a Notice Of Alleged Violation was issued, requiring remediation by September 27 , 1995. On November 11, 1995, the site was re-inspected by COGCC staff and there was no indication that work to bring the alleged violations into compliance had been performed. Subsequently, Tandem Oil Company was then contacted by telephone and informed of the alleged violations.

6. At the November 21, 1995 hearing, upon the presentation of evidence by the Director, a Cease and Desist Order was issued by the COGCC for the Marick State No. 1 Well.

7. On November 24, 1995, a notice of hearing was mailed to Tandem Oil Company for a December 20, 1995 hearing in the matter of the alleged violations. On December 13, 1995, a proposed Administrative Order of Consent was submitted to Tandem Oil Company and signed as concurrence by the president of Tandem Oil Company.

8. On January 16, 1996, after discussions between Tandem Oil Company and COGCC staff, a revised Administrative Order by Consent was issued by COGCC staff with the agreement of Tandem Oil Company. The Hearing Officer recommends that Tandem Oil Company be found in violation of Rule No. 902.e., accumulation of oil in a pit for more than twenty-four (24) hours after discovery; Rule No. 902.f., lack of appropriate netting; and Rule 907.a., unreported and un remediated release of oil. Further, the Hearing Officers recommends a fine of Two Thousand Dollars ($2,000) be assessed for violation of Rule 902.e., payable within thirty (30) days from issuance of the Order.

O R D E R

NOW, THEREFORE IT IS ORDERED, that Tandem Oil Company shall be found in violation of Rule No. 902.e., accumulation of oil in a pit for more than twenty-four (24) hours after discovery; Rule No. 902.f., lack of appropriate netting; and Rule 907.a., unreported and unremediated release of oil.

IT IS FURTHER ORDERED, that Tandem Oil Company shall be assessed a total fine of Two Thousand Dollars ($2,000) for violation of Rule 902.e., payable within thirty (30) days of the date the order is entered.

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.

ENTERED this day of , 1996, as of January 18, 1996.

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 February 6, 1996 ??