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 ARNOLD AND DARLEEN MACKLEY, GARFIELD COUNTY, COLORADO

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CAUSE NO. 1V

DOCKET NO. 160700305

TYPE:  ENFORCEMENT

ORDER NO. 1V-587

 

 

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.         Arnold and Darleen Mackley (“Mackleys”) (Operator No. 10043) are the operators of record for the Ed T. Bernklau 1 Well (API 05-045-05076) (“Well”) and the Ed T. Bernklau-66S94W / 34NWSW Location (Location No. 322296) in Garfield County.

 

2.         The Well was completed on December 30, 1961 by operator Marie Bernklau. No production records have been submitted for the Well since at least 1999, when electronic records were first kept by the Commission.

 

3.         The Well has had no known commercial production but rather only produced gas for domestic purposes. The Well is no longer capable of production and has been for an undetermined number of years.

 

4.         An active bond in the amount of $5,000 is posted for the plugging and reclamation of the Well.  Details of the financial assurance instrument are as follows:

 

Surety ID:

2004-0015 

Status:

Active  

Operator Number:

10043 

Bond Amount:

$5,000.00

Instrument:

Cash

Instrument Number:

1226  

Coverage:

Individual  

Bond Type:

Plugging  

Limitation:

1 

Deposit Number:

04-59 

PDPA Number:

Ed T. Bernklau #1 

Received Date:

3/9/2004

Approved Date:

3/9/2004

FA Provider Number:

10043 

FA Provider Name:

Mackley* Arnold & Darleen

Deposit Date:

3/15/2004

 

5.         On April 13, 2016, Mackleys requested that the Commission call the bond, and plug and abandon the Well. Mackleys reported that the Well is leaking gas. Mackleys do not have the financial capacity to perform the plugging and abandonment of the Well.

 

6.         On May 13, 2016, COGCC staff inspected the Well (Document No. 666802141) and confirmed the Well is leaking gas and lacks mechanical integrity.

 

            7.         Both the Mackleys and COGCC Staff agree that it is in the best interest of both parties to call or foreclose Mackleys’ financial assurance to properly plug and abandon the Well.

 

AGREEMENT

 

The parties agree as follows:

 

  1. Mackleys agree that they are incapable of fulfilling statutory duties imposed by the Oil and Gas Conservation Act.

 

  1. Mackleys agree to the foreclosure of the Well’s financial assurance instrument, along with any accrued interest, with the proceeds applied towards plugging and abandonment of the Well.

 

  1. Mackleys agree to surrender the Well and associated appurtenances for purposes of plugging and abandoning the well.  Any salvage value of well appurtenances may be applied by the Commission towards the cost of plugging and abandonment of the Well.

 

  1. Mackleys agree to provide adequate access and otherwise fully cooperate with the Commission for purposes of allowing the Commission or its contractors plug and abandon the Well.

 

RECOMMENDED this  26th day of May, 2016.

 

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

 

 

By                                                                       

Peter J. Gowen, Enforcement Supervisor

AGREED TO AND ACCEPTED this ______day May, 2016.

                                                                                                                                                                                    ARNOLD AND DARLEEN MACKLEY

                             

 

                        By                                                                                          

                                    Arnold Mackley, Operator

                       

                                                                                                                       

                       Darleen Mackley, Operator      

                                  

                       

ORDER

 

HAVING CONSIDERED the Agreement between the Director and Mackleys, the COMMISSION ORDERS:

 

            1.         The financial assurance instrument with accrued interest, referenced above in paragraph 4 is to be called and foreclosed to the fullest extent allowed by law.

 

2.         The proceeds from the calling of the financial assurance instrument are to be applied to cover costs of proper plugging and abandonment of the Well.

 

3.         Any salvage value of the Well appurtenances is to be applied towards to cost of plugging and abandoning the Well at the Director’s discretion.

 

4.         Mackleys shall provide adequate access and otherwise fully cooperate with the Commission for purposes of allowing the Commission or its contractors to properly plug and abandon the Well.

 

5.         Staff is authorized to use the Oil and Gas Conservation and Environmental Response Fund to complete the proper plugging and abandonment of the Well, if the Mackleys’ financial assurance is inadequate to complete the required work.

 

6.         The Mackleys’ Certificate of Clearance – Form 10 is revoked. It may not be reinstated except by Order of the Commission, and only upon payment of any deficit between the Mackleys’ financial assurance instrument and the Commission’s cost of plugging and abandonment of the Well.

 

7.         This Order is effective as of the date it is mailed by the Commission.  It constitutes final agency action for purposes of judicial review.

 

8.         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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ENTERED this _____ day of                     , 2016 as the 18th day of July, 2016.
           

                                                            OIL AND GAS CONSERVATION COMMISSION

            OF THE STATE OF COLORADO

 

 

            By                                                                                          

                                                                        Julie Murphy, Secretary

 

 

 

CERTIFICATE OF MAILING

 

On _______________ , 2016, a true and accurate copy of Commission Order 1V-587 was mailed by first-class mail return receipt requested to the following:

 

 

Arnold & Darleen Mackley 
4031 County Road 320
Rifle, CO  81650