IN THE MATTER OF ALLEGED VIOLATIONS OF THE RULES
CAUSE NO. 1
AND REGULATIONS OF THE COLORADO OIL AND GAS
CONSERVATION COMMISSION BY FAITH ENERGY
ORDER NO. IV-177
EXPLORATION, INC., RIO GRANDE COUNTY, COLORADO
REPORT OF THE COMMISSION
This cause came on for hearing before the Commission on August 19, 1999 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 Faith Energy
Exploration, Inc. is not in violation of Rule 210.b., requiring a well sign be
posted; Rules 308A. and 308B., requiring a Drilling Completion Report, Form 5,
and a Completed Interval Report, Form 5A, to be submitted within thirty (30)
days of completion; and Rule 326.b., requiring wells shut in longer than two (2)
years be tested for mechanical integrity, 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. Faith Energy Exploration, Inc. (“Faith”) 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 17, 1996, a Notice of Alleged Violation (“NOAV”) was issued to
Faith for the Jynnifer #1 Well located in the NE¼ SE¼ of Section 9, Township 40
North, Range 5 East, N.M.P.M., alleging violations of Rule 307., requiring
notice to the Director of change of plans; Rule 308., requiring a Drilling
Completion Report, Form 5, to be submitted within thirty (30) days of
completion; and Rule 326.b., requiring wells shut-in longer than two (2) years
be tested for mechanical integrity, with an abatement date of October 18, 1996.
Faith did not respond to this NOAV.
5. The Jynnifer #1 Well was inspected by COGCC staff on December 30, 1997. The
inspection found the well temporarily abandoned with equipment on location. Upon
inspection, staff requested that Faith submit a Sundry Notice, Form 4,
describing future plans.
6. On February 13, 1998 a NOAV was issued to Faith alleging violations of Rule
210.b., requiring a well sign be posted; Rules 308A. and 308B., requiring a
Drilling Completion Report, Form 5 and Completed Interval Report, Form 5A to be
submitted within thirty (30) days of completion; and Rule 326.b., requiring
wells shut-in longer than two (2) years to be tested for mechanical integrity,
with an abatement date of February 27, 1998.
7. On February 23, 1998, Faith responded to the NOAV. Faith stated these
properties had been turned over to the landowner, Mr. L. G. Mosley. On March 31,
1998, Mr. L. G. Mosley responded that he did not accept operatorship of this
well and that he wanted the Jynnifer #1 Well plugged and abandoned.
9. On February 4, 1999, COGCC staff informed Faith by letter that the COGCC
considered Faith to be the operator of this well and that the compliance date
for the NOAV had been extended to June 30, 1999.
10. On July 6, 1999 an Administrative Order by Consent (“AOC”) was offered to
Faith. On July 10, 1999 as per return receipt the AOC was received.
11. As of July 28, 1999, a mechanical integrity test (“MIT”) had not been
performed on this well, no completion reports had been submitted to the COGCC,
no well sign had been posted and the AOC had not been agreed to and accepted by
Faith.
12. In accordance with §34-60-121(6), C.R.S., the Commission considers Faith’s
failure to bring the well and lease into compliance after numerous notifications
as evidence of a pattern of violation of Commission rules and orders. Faith’s
failure to perform a MIT threatens to cause significant adverse environmental
impact.
ORDER
NOW, THEREFORE, IT IS ORDERED that Faith Energy Exploration, Inc., shall be
found in violation of Rule 210.b., requiring a well sign be posted; Rules 308A.
and 308B., requiring a Drilling Completion Report, Form 5, and a Completed
Interval Report, Form 5A, to be submitted within thirty (30) days of completion;
and Rule 326.b., requiring wells shut-in longer than two (2) years be tested for
mechanical integrity for the Jynnifer #1 Well located in the NE¼ SE¼ of Section
9, Township 40 North, Range 5 East, N.M.P.M.
IT IS FURTHER ORDERED that Faith Energy Exploration, Inc., shall post a well
sign, submit a valid Drilling Completion Report, Form 5 and Completed Interval
Report, Form 5A, and perform a mechanical integrity test, plug and abandon, or
return to production the Jynnifer #1 Well within thirty (30) days of the date
the order is entered.
IT IS FURTHER ORDERED that Faith Energy Exploration, Inc. shall be assessed a
fine of Three Thousand Five Hundred dollars ($3,500), payable within thirty (30)
days of the date the order is entered.
IT IS FURTHER ORDERED that if Faith Energy Exploration, Inc., does not comply
with the order, COGCC staff shall be authorized to commence claim on the Five
Thousand dollar ($5,000) plugging bond and proceed to plug and abandon the
Jynnifer #1 Well. If plugging and reclamation costs exceed the bond amount COGCC
staff shall be authorized to confiscate available equipment and tubulars for
salvage per §34-60-124.(6).(c). C.R.S.
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 31st day of August, 1999, as of August 19, 1999.
OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
By Dated at Suite 801 Patricia C. Beaver, Secretary 1120 Lincoln Street Denver,
Colorado 80203 August 31, 1999.
(1V#177)