BEFORE THE OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
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IN THE MATTER OF ALLEGED VIOLATIONS OF THE RULES AND REGULATIONS OF THE COLORADO OIL AND GAS CONSERVATION COMMISSION BY M E III CORPORATION, IN WELD COUNTY, COLORADO |
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CAUSE No. 1V
ORDER No. 1V-482
DOCKET No. 1407-OV-56 |
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. M E III Corporation (Operator no. 52060) (“M E III”) is the owner and operator of record for the Perry #1 Well (API # 05-123-09423) and the Perry #3 Well (API # 05-123-10324), located in Weld County, Colorado (the “Wells”).
2. The COGIS database shows that M E III last filed an Oil and Gas Conservation Levy, Form 8 on September 7, 2006.
3. The COGIS database shows that M E III sporadically filed Operator’s Monthly Production Reports over the years, and the last filing was June 15, 2011.
4. On July 12, 2013, COGCC Staff issued M E III a Notice of Alleged Violation (“NOAV”) (No. 200382926).
5. Staff served the NOAV according to the requirements of the Colorado Oil and Gas Conservation Act, § 34-60-108(4), C.R.S., and the Colorado Administrative Procedures Act, § 24-4-105, by sending it certified mail to Scott Ernest (M E III’s registered agent) at 14182 W. 4th Avenue, Golden CO 80401. The NOAV and cover letter were returned on August 12, 2013, with a label stating “Not Deliverable to Addressed Unable to Forward.”
6. Using a process server, the COGCC perfected service by refusal of the NOAV and a Notice of Hearing on July 6, 2014, at the home of M E III’s registered agent.
7. The NOAV cited violations of the following COGCC Rules of Practice and Procedure, 2 CCR 404-1 (“Rule” or “Rules”):
a. 309 - Operator’s Monthly Report of Operations, Form 7.
b. 310 - Oil and Gas Conservation Levy, Form 8
a. One ten-day violation of Rule 309 because M E III is delinquent in filing its Operator’s Monthly Report of Operations, Form 7.
b. One ten-day violation of Rule 310 because M E III is delinquent in filing its Oil and Gas Conservation Levy, Form 8.
9. Pursuant to Rule 523 and the Commission’s Enforcement and Penalty Policy, Staff calculated a penalty of $20,000 for these violations. Staff does not recommend adjustments based on aggravating or mitigating factors.
10. On August 21, 2014, M E III filed with the Commission Staff and the Commission Staff accepted:
a. All outstanding Operator’s Monthly Reports of Operations, Form 7;
b. All outstanding Oil and Gas Conservation Levy reports, Form 8;
c. An updated Certification of Clearance And/Or Change of Operator, Form 10, to report new transporter information;
d. Payment of the outstanding conservation levy with interest in the amount of $1,774.40.
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 M E III agrees to settle the NOAV on the following terms and conditions:
I. M E III is found in violation of Rule 309 and Rule 310 as described above.
II. M E III is assessed a penalty of $20,000, with $15,000 suspended if all Operator’s Monthly reports of Operations, Form 7, and all Oil and Gas Conservation Levy reports, Form 8, are properly filed for one year after Commission approval of this AOC.
III. M E III will pay $5,000, within 35 days after this AOC is mailed by the Commission, addressed to M E III Corporation at 2760 Pierce Street, Wheat Ridge, Colorado 80214.
IV. The suspended portion of the penalty ($15,000) will become due on demand by the Director without further action upon M E III’s failure to perform any of the actions listed in paragraphs II-III.
V. M E III agrees to the findings of this AOC only for the purpose of expeditiously resolving the matter without a contested hearing.
RECOMMENDED this ____day of August, 2014.
OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
By
Peter Gowen, Enforcement Officer
AGREED TO AND ACCEPTED this ______day of _____, 2014.
M E III Corporation
By
Signature of Authorized Company Representative
Print Signatory Name
Title
ORDER
HAVING CONSIDERED the Agreement between the Director and M E III to resolve the NOAV, the COMMISSION ORDERS:
1. M E III is found in violation of Rule 309 and Rule 310.
2. M E III is assessed a penalty of $20,000, with $15,000 suspended if Operator’s Monthly reports of Operations, Form 7, and all Oil and Gas Conservation Levy reports, Form 8, are properly filed for one year after Commission approval of this AOC.
3. M E III will pay $5,000, within 35 days after this AOC is mailed by the Commission, addressed to M E III Corporation at 2760 Pierce Street, Wheat Ridge, Colorado 80214.
4. The suspended portion of the penalty ($15,000) will become due on demand by the Director without further action upon M E III’s failure to perform any of the actions listed in paragraphs 2-3.
5. M E III, or its successors or assigns, will remain responsible for complying with this AOC, in the event of any subsequent conveyance of the Wells. M E III will remain solely responsible for payment of the penalty amount, in the event of any subsequent conveyance of the Wells.
6. 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.
7. The Commission expressly reserves its right after notice and hearing, to alter, amend, or repeal any and/or all of the above orders.
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OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By
Robert J. Frick, Secretary