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 BP AMERICA PRODUCTION COMPANY, ARCHULETA COUNTY, COLORADO |
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CAUSE NO. 1V
ORDER NO. 1V-533 DOCKET NO. 150900352 TYPE: ENFORCEMENT |
ADMINISTRATIVE ORDER BY CONSENT
(Pursuant to Rule 522.e.(1) of the Rules and Regulations of the
Colorado Oil and Gas Conservation Commission, 2 CCR 404-1)
FINDINGS
1. BP America Production Company (“BP America”) (Operator No. 10000) is the operator of a produced water flowline located at SWNE Sec 7, T32N R5W (Spill Release Point ID: 441424) (“flowline”) in Archuleta County, Colorado.
2. This flowline gathers produced water from four wells: Carmelita Gallegos A1 Well (API No. 05-007-06124), Seibel B1 Well (API No. 05-007-06125), Seibel A1 Well (API No. 05-007-06123), and Marquez A1 Well (API No. 05-007-06165).
3. On March 30, 2015, a landowner’s representative notified BP America of a water leak on his property. BP America responded the same day, shut-in the flowline, and began clean-up operations. BP America also notified COGCC Staff of the release.
4. On March 31, 2015, COGCC Staff inspected the spill site and observed that the release had flowed from the pipeline right of way through a wooded area and into a dry irrigation ditch, which had not been turned on for the season (Doc. No. 674900456). The Darlington Ditch is approximately 270 feet to the west of the flowline leak. The ditch company was planning to release water to this ditch on April 19 or 20, 2015.
5. On April 2, 2015, BP America filed a Form 19, Spill/Release Report (Doc. No. 400819636). A Supplemental Form 19 submitted on April 13, 2015 indicated that over 100 barrels of produced water had been released, waters of the state had been impacted or threatened by the release, and the release was the result of equipment failure (Doc. No. 400824110).
6. On April 21, 2015, BP America submitted a Form 27, Site Investigation and Remediation Workplan, which determined that the release impacted approximately 14,300 square feet of soil surface and 110 trees (Doc. No. 2142877).
7. Between April 1 and April 3, 2015, BP America excavated and removed the failed section of pipeline and replaced the pipeline section. On April 8, 2015, BP America took soil samples and began removal of the impacted soils. On April 30, 2015, the surface owner requested BP America temporarily halt remedial activities.
8. On May 12, 2015, in its Answer to the NOAV, BP America admitted that it did not annually pressure test this flowline and that the pressure of the impacted flowline segment was not monitored continuously because a pressure transmitter was not installed on the well nearest to the leak location.
9. On April 14, 2015, Commission Staff issued a Notice of Alleged Violation (“NOAV”) (No. 200429174) to BP America citing violations of the following COGCC Rules of Practice and Procedure, 2 CCR 404-1 (“Rule” or “Rules”):
a. Rule 605.d. (Oil and Gas Facilities, Mechanical Conditions) for the failure maintain the flowline in good mechanical condition; and
b. Rule 1101.e. (Installation and Reclamation, Pressure Testing) for the failure to annually pressure test the flowline.
11. Pursuant to Rule 523 and the Commission’s Enforcement and Penalty Policy, Staff calculated a penalty of $20,000 for this violation. The penalty calculation is based on the following:
|
Rule |
Class |
Impact |
Daily Penalty |
Start Date |
End Date |
Days |
Total Penalty |
|
605.d. |
Class 2 |
Moderate |
$10,000 |
3/30/2015 |
3/31/2015 |
1 |
$10,000 |
|
1101.e. |
Class 2 |
Moderate |
$10,000 |
3/30/2015 |
3/31/2015 |
1 |
$10,000 |
|
TOTAL PENALTY |
$20,000 |
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a. Violations beginning after the effective date of HB 14-1356 (June 6, 2014) and revised Rules 522/523 (March 2, 2015);
b. Moderate impact;
c. The daily penalty amount was increased from the base penalty provided by Rule 523 to make the penalty appropriate to the nature of the violation and based on consideration of the totality of the circumstances;
d. No aggravating or mitigating factors; and
e. No pattern of violation or gross negligence/knowing and willful misconduct.
AGREEMENT
NOW, THEREFORE, based on the Findings and pursuant to Rule 522.e.(1) and the Commission’s Enforcement and Penalty Policy, the Director proposes and BP America agrees to settle the NOAV on the following terms and conditions:
I. BP America is found in violation of Rules 605.d. and 1101.e., as described above.
II. BP America will be assessed a penalty of $20,000.
III. BP America will pay $20,000 within 30 days after the approved AOC is mailed by the Commission.
IV. BP America will fulfill the requirements of Remediation Project 9014 as soon as possible in cooperation with the surface owner. However, BP America will complete the remediation no later than October 30, 2015. These requirements include: completing excavation; submitting confirmation of compliance with Table 910-1; importing soil, re-contouring, and re-seeding the upland area; and sampling irrigation water.
V. Payment of the penalty pursuant to this AOC does not relieve the operator from its obligations to complete corrective actions set forth in the NOAVs, as may be amended or modified by COGCC Staff.
RECOMMENDED this 25th day of August, 2015.
OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
By
Britta Beckstead, Assistant Attorney General
AGREED TO AND ACCEPTED this 25th day of August, 2015.
BP AMERICA PRODUCTION COMPANY
By
Signature of Authorized Company Representative
Print Signatory Name and Title
ORDER
HAVING CONSIDERED the Agreement between the Director and BP America to resolve the NOAV, the COMMISSION ORDERS:
1. BP America is found in violation of Rules 605.d. and 1101.e., as described above.
2. BP America is assessed a penalty of $20,000.
3. BP America will pay $20,000 within 30 days after the approved Order is mailed by the Commission. Failure to pay the penalty by the deadline is an independent violation that may be subject to additional penalties.
4. BP America will fulfill the requirements of Remediation Project 9014 as soon as possible in cooperation with the surface owner. However, BP America will complete the remediation no later than October 30, 2015. These requirements include: completing excavation; submitting confirmation of compliance with Table 910-1; importing soil, re-contouring, and re-seeding the upland area; and sampling irrigation water.
5. Compliance dates specified in this Order may be extended only for good cause, as determined at the Director’s sole discretion. A request for extension must be made, in writing, at least 30 days prior to the pertinent compliance deadline or as soon as possible if 30 days prior notice is not feasible. Failure to receive an extension prior to the compliance deadline or the failure to meet a compliance deadline may constitute a new violation subject to additional penalties.
6. Entry of this Order constitutes final agency action for purposes of judicial review 30 days after the date this Order is mailed by the Commission. For all other purposes, this Order is effective as of the date it is approved 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 Order.
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OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By
Julie Murphy, Secretary