BEFORE THE OIL AND GAS CONSERVATION COMMISSION

OF THE STATE OF COLORADO

IN THE MATTER OF ALLEGED VIOLATIONS OF THE RULES AND REGULATIONS OF THE COLORADO OIL AND GAS CONSERVATION COMMISSION BY WESTERN OPERATING COMPANY, WASHINGTON COUNTY, COLORADO

) ) ) ) )

CAUSE NO. 1V DOCKET NO. 1403-OV-04 ORDER NO. IV-446

ADMINISTRATIVE ORDER BY CONSENT

(Pursuant to Rule 522.b.(3) of the Rules and Regulations of the

 Colorado Oil and Gas Conservation Commission, 2 CCR 404-1)

FINDINGS

1. Western Operating Company (“Western”) (Operator No. 95620) is the operator of record for the Forbes 1-14 well (API # 05-121-06758) (the “Well”), in Washington County, Colorado.

2. Aerial photographs taken in 2009 document the presence of a skim pit (the “Pit”) at the Well.

3. In 2011, additional aerial photographs of the well show stockpiled soil and tanks located where the Pit was located in the 2009 photographs.

4. On November 20, 2013 COGCC performed an inspection of the Well (Doc. No. 670600111) and observed that the Pit had been closed.

5. Western did not submit a Form 27, Investigation and Remediation Work Plan, and did not obtain prior approval from COGCC staff before closing the Pit.

6. Western did not provide COGCC with any documentation related to the Pit closure or the disposition of any E&P waste generated therefrom.

7.         On December 13, 2013 COGCC issued NOAV No. 200392590 (the “NOAV”) to Western citing violations of the following COGCC Rules of Practice and Procedure, 2 CCR 404-1 (“Rule” or “Rules”):

a. 324A.a (Pollution)

b. 603.f (Statewide Location Requirements for Equipment, Weeds, Waste, and Trash)

c. 902 (Pits – General and Special Rules)

d. 905.b (Closure of Pits, and Buried or Partially Buried Produced Water Vessels)

e. 907.a  (Management of E&P Waste, General Requirements)

f. 907.e (Management of E&P Waste, Oily Waste)

g. 909 (Site Investigation, Remediation, and Closure)

h. 910 (Concentrations and Sampling for Soil and Groundwater)

8.         Following a factual investigation and legal review of the violations alleged in the NOAV, Hearings Staff now asserts Western has committed the following violations:

a. One violation of Rule 905.b by failing to submit a Form 27 and failing to obtain COGCC approval before closing the Pit.

b. One violation of Rule 907.a by failing to insure that E&P waste is properly stored, handled, transported, treated, recycled or disposed of to prevent threatened or actual significant adverse environmental impacts to the extent necessary to ensure compliance with the concentration levels in Table 910-1.

c. One violation of Rule 909 by failing to ensure the proper closure and remediation of the Pit.

9.         The Hearings Staff has elected not to pursue any fines or corrective actions in regards to Western’s alleged violations of Rules 324A.a, 603.f, 902, 907.e, and 910.  The Hearings staff has determined that the record does not contain sufficient evidence to support findings of violations of these rules at this time.  COGCC reserves the right to prosecute violations of these rules in the future if it determines that such action is warranted by the evidence.

10.       Pursuant to Rule 523 and the Commission’s Enforcement and Penalty Policy, Hearings staff has calculated a maximum penalty of $30,000.00 for these violations.  Staff recommends consideration of Western’s cooperation with hearings staff in seeking resolution of this matter through an AOC as a mitigating factor which justifies a $5,000.00 reduction in the penalty.

AGREEMENT

          NOW, THEREFORE, based on the Findings and pursuant to Rule 522.b.(3) and the Commission’s Enforcement and Penalty Policy, the Director proposes and Western agrees to settle the NOAV on the following terms and conditions:

I. Western is assessed a penalty of $25,000.  Payment will be due 30 days after adoption of this AOC by the Commission.

II. Western will submit a Form 27 within 10 days of adoption of this AOC by the Commission.

III. If oily waste was removed from the Pit prior to closure and samples collected, Western shall remit a sample location diagram, analytical results, laboratory reports, and waste disposal documentation with its Form 27.

IV.       If oily waste was not removed prior to closure of the Pit, Western will remove contaminated soil and collect confirmation samples to verify compliance with Table 910-1.  All waste removed shall be treated or disposed of in accordance with the Rules.

V.        Western shall immediately notify COGCC in writing of any other pits that have been closed without submittal of a Form 27 or prior approval from the COGCC as required by the Rules.  Notification shall include the location of the well, the facility identification number, the related API number, the date of closure, and the disposition of any E&P waste.

RECOMMENDED this  20^th  day of February, 2014.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By

Peter J. Gowen, Enforcement Officer 

AGREED TO AND ACCEPTED this ______day of  __________, 2014.

                        Western Operating Company

                        By

                        Signature of Authorized Company Representative

                       Print Signatory Name

                        Title

ORDER

            HAVING CONSIDERED the Agreement between the Director and Western to resolve the NOAV, the COMMISSION ORDERS:

1. Western shall be assessed a total fine of $25,000.00 for the Rule violations set forth above, payable within 30 days of adoption of this AOC by the Commission. 

2.         Western shall submit a Remediation Plan Form 27 within 10 days of adoption of this AOC by the Commission.

3.         If oily waste was removed from the Pit prior to closure and samples collected, Western shall remit a sample location diagram, analytical results, laboratory reports, and waste disposal documentation with its Form 27.

4.         If oily waste was not removed prior to closure of the Pit, Western will remove contaminated soil and collect confirmation samples to verify compliance with Table 910-1.  All waste removed shall be treated or disposed of in accordance with the Rules.

5.         Western shall immediately notify COGCC in writing of any other pits that have been closed without submittal of a Form 27 or prior approval from the COGCC as required by the Rules.  Notification shall include the location of the well, the facility identification number, the related API number, the date of closure, and the disposition of any E&P waste.

6.         Payment of the penalty pursuant to this AOC does not relieve Western from its ongoing obligations to complete remaining corrective actions as set forth the compliance schedule to be agreed upon with COGCC staff.  Failure to satisfactorily complete remediation and reclamation, and pay the penalty will result in future Commission enforcement action and other remedies as authorized by law.

7.         Western, or its successors or assigns, will remain responsible for complying with this AOC, in the event of any subsequent conveyance of the Well.

8.         Entry of this Order constitutes final agency action for purposes of judicial review as of the date this order is mailed by the Commission. For all other purposes, this Order is effective as of the date of approval by the Commission.

9.         An application for reconsideration by the Commission of this order is not required prior to the filing for judicial review.

10.       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 March, 2014, as of the _____ day of March, 2014.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By______________________________________

                     Robert J. Frick, Secretary