IN THE MATTER OF GENERAL RULES AND REGULATIONS WITH RESPECT TO THE CONSERVATION OF- OIL AND GAS IN THE STATE OF COLORADO, AND RULES OF PRACTICE AND PROCEDURE PERTAINING THERETO AND IN PARTICULAR WITH REFERENCE TO RULE 328

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Cause No. 1V Type: ENFORCEMENT Order No. 1V-2 (Formerly 1-17)

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on January 21, 1975, at 9 a.m. in Room 532., State Services Building, Denver, Colorado, after giving Notice of Hearing as required by law, on the Commission's own motion, to order Kenneth L. Tipps, operator of a lease located in the Dorado Field., Washington County, Colorado, to appear before the Commission and show cause why he should not be cited as being in violation of Rule 328 (Retaining Pits) of t he Commission's Rules and Regulations.

FINDINGS

The Commission finds as follows:

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

2. That 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.

3. That Rule 328 of this Commission's Rules and Regulations states., in part., "Retaining pits for the storage of produced water shall be kept free of surface accumulation of oil or other liquid hydrocarbons substances. Any retaining pit found to contain surface accumulations of oil or liquid hydrocarbon substances must be cleaned within ten (10) days after discovery thereof, by the operator or notice from the Commission, whichever is sooner."

4. That members of the Commission staff testified that an aerial inspection made of the Dorado Field on November 25, 1974 disclosed that a retaining pit on the Friend Lease in the SW1/4 NE1/4 Section 20, Township 3 South, Range 50 West, was 100% oil covered, and that a field inspection on December 10, 1974 showed said retaining pit was again 100% oil covered.

5. That on November 27, 1974 a notice was sent to Mr. Kenneth L. Tipps., operator of said Friend Lease, advising him of the condition of the retaining pit and informing him of the provisions of Rule 328.

6. That testimony presented by the respondent indicates that there is considerable difficulty in maintaining oil-free retaining pits in the Dorado Field due to the physical properties of the crude oil, and that there are many problems involved to effect separation of the oil-water mixture that is produced in said Field.

7. That a concerted effort has been made by Mr. Tipps to maintain an oil free surface on the retaining pit by periodic use of vacuum trucks for removal of oil accumulations.

8. That due to the possibility of a mechanical failure during separation of the oil-water mixture, the retaining pit should be covered in such a manner that will prevent any wildlife from entering said pit.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the operator of the well on the Friend Lease located in the SW1/4 NE1/4, Section 20, Township 3 South, Range 50 West 6th P. M., Dorado Field, Washington County, Colorado, shall shut in said well until such time as the first retaining pit next to the skimming pit is covered in such a manner that will prevent any wildlife from entering said pit.

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 order.

ORDERED this 21st day of January, 1975.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary