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 BAYSWATER EXPLORATION & PRODUCTION LLC, WELD COUNTY, COLORADO

)

)

)

)

)

CAUSE NO. 1V

DOCKET NO. 170100008

TYPE:  ENFORCEMENT

ORDER NO: 1V-613

 

ADMINISTRATIVE ORDER BY CONSENT

(Pursuant to Rule 522.e. of the Rules and Regulations of the

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

 

FINDINGS

 

1.            Bayswater Exploration & Production LLC (“Bayswater”) (Operator No. 10261) is the operator of the following wells in Weld County, Colorado (“Wells”):

TABLE 1

Well Name

Well API

NOAV No.

Rule/Act Violations

Arellano K-10-9HN

05-123-41106

401123787

Rule 205A

Arellano L-10-9HN

05-123-41113

401122866

Rule 205A

Arellano M-10-9HN

05-123-41107

401124027

Rule 205A

Arellano N-10-9HN

05-123-41112

401121857

Rule 205A and 316C

Arellano O-10-9HN

05-123-41110

401124042

Rule 316C

Arellano P-10-9HN

05-123-41109

401124032

Rule 316C

Arellano Q-10-9HN

05-123-41108

401124029

Rule 205A and 316C

Arellano R-10-9HN

05-123-41105

401123785

Rule 205A and 316C

Arellano S-10-9HN

05-123-41111

401121017

Rule 205A

Arellano T-10-9HN

05-123-41114

401122915

Rule 205A

Eisenach 1

05-123-11860

401132217

§34-60-121(1), C.R.S.

 

Arellano K-10-9HN Well (NOAV 401123787)

 

2.            On February 11, 2016, Bayswater completed a hydraulic fracturing treatment on the Arellano K-10-9HN Well.

3.            At the latest, the disclosure of the treatment to FracFocus was due pursuant to Rule 205A of the COGCC Rules of Practice and Procedure, 2 C.C.R. 404-1 (“Rule” or “Rules”) on April 11, 2016.

4.            On April 18, 2016, Bayswater submitted disclosures to FracFocus for the hydraulic fracturing treatment.

5.            On October 28, 2016, COGCC Staff issued Notice of Alleged Violation (“NOAV”) No. 401123787 to Bayswater for a violation of Rule 205A (Hydraulic Fracturing Chemical Disclosure) (“Rule 205A”) at the Arellano K-10-9HN Well.

6.            On November 7, 2016, Bayswater submitted an Answer to the NOAV and provided an explanation of how future FracFocus disclosures will be made on time, satisfying the corrective action requirements in NOAV No. 401123787.

Arellano L-10-9HN Well (NOAV 401122866)

 

7.            On January 26, 2016, Bayswater completed a hydraulic fracturing treatment on the Arellano L-10-9HN Well.

8.            At the latest, the disclosure of the treatment to FracFocus was due on March 26, 2016 pursuant to Rule 205A.

9.            On April 18, 2016, Bayswater submitted disclosures to FracFocus for the hydraulic fracturing treatment.

10.         On October 28, 2016, COGCC Staff issued NOAV No. 401122866 to Bayswater for a violation of Rule 205A at the Arellano L-10-9HN Well.

11.         On November 7, 2016, Bayswater submitted an Answer to the NOAV and provided an explanation of how future FracFocus disclosures will be made on time, satisfying the corrective action requirements in NOAV No. 401122866.

Arellano M-10-9HN Well (NOAV 401124027)

 

12.         On February 11, 2016, Bayswater completed a hydraulic fracturing treatment on the Arellano M-10-9HN Well.

13.         At the latest, the disclosure of the treatment to FracFocus was due on April 11, 2016 pursuant to Rule 205A.

14.         On April 18, 2016, Bayswater submitted disclosures to FracFocus for the hydraulic fracturing treatment.

15.         On October 28, 2016, COGCC Staff issued NOAV No. 401124027 to Bayswater for a violation of Rule 205A at the Arellano M-10-9HN Well.

16.         On November 7, 2016, Bayswater submitted an Answer to the NOAV and provided an explanation of how future FracFocus disclosures will be made on time, satisfying the corrective action requirements in NOAV No. 401124027.

 

 

 

 

Arellano N-10-9HN Well (NOAV 401121857)

 

17.         On January 27, 2016, Bayswater commenced a hydraulic fracturing treatment on the Arellano N-10-9HN Well. Bayswater did not submit a Form 42, Field Operations Notice, at least 48 hours prior to commencing this treatment.

18.         On February 13, 2016, Bayswater completed a hydraulic fracturing treatment on the Arellano N-10-9HN Well.

19.         At the latest, the disclosure of the treatment to FracFocus was due on April 16, 2016 pursuant to Rule 205A.

20.         On April 18, 2016, Bayswater submitted disclosures to FracFocus for the hydraulic fracturing treatment.

21.         On October 28, 2016, COGCC Staff issued NOAV No. 401121857 to Bayswater for violations of Rule 205A and Rule 316C (Notice of Intent to Conduct Hydraulic Fracturing Treatment) (“Rule 316C”) at the Arellano N-10-9HN Well.

22.         On November 7, 2016, Bayswater submitted an Answer to the NOAV and provided an explanation of how future FracFocus disclosures and Form 42, Field Operations Notices, will be submitted on time, satisfying the corrective action requirements in NOAV No. 401121857 for both the Rule 205A and Rule 316C violations.

Arellano O-10-9HN Well (NOAV 401124042)

 

23.         On January 27, 2016, Bayswater commenced a hydraulic fracturing treatment on the Arellano O-10-9HN Well. Bayswater did not submit a Form 42, Field Operations Notice, at least 48 hours prior to commencing this treatment.

24.         On October 28, 2016, COGCC Staff issued NOAV No. 401124042 to Bayswater for a violation of Rule 316C at the Arellano O-10-9HN Well.

25.         On November 7, 2016, Bayswater submitted an Answer to the NOAV and provided an explanation of how future Form 42, Field Operations Notices, will be submitted on time, satisfying the corrective action requirements in NOAV No. 401124042.

Arellano P-10-9HN Well (NOAV 401124032)

 

26.         On February 3, 2016, Bayswater commenced a hydraulic fracturing treatment on the Arellano P-10-9HN Well. Bayswater did not submit a Form 42, Field Operations Notice, at least 48 hours prior to commencing this treatment.

27.         On October 28, 2016, COGCC Staff issued NOAV No. 401124032 to Bayswater for a violation of Rule 316C at the Arellano P-10-9HN Well.

28.         On November 7, 2016, Bayswater submitted an Answer to the NOAV and provided an explanation of how future Form 42, Field Operations Notices, will be submitted on time, satisfying the corrective action requirements in NOAV No. 401124032.

Arellano Q-10-9HN Well (NOAV 401124029)

 

29.         On January 27, 2016, Bayswater commenced a hydraulic fracturing treatment on the Arellano Q-10-9HN Well. Bayswater did not submit a Form 42, Field Operations Notice, at least 48 hours prior to commencing this treatment.

30.         On February 26, 2016, Bayswater completed a hydraulic fracturing treatment on the Arellano Q-10-9HN Well.

31.         At the latest, the disclosure of the treatment to FracFocus was due on April 26, 2016 pursuant to Rule 205A.

32.         On October 28, 2016, COGCC Staff issued NOAV No. 401124029 to Bayswater for violations of Rule 205A and Rule 316C Rule 205A at the Arellano Q-10-9HN Well.

33.         On November 1, 2016, Bayswater submitted disclosures to FracFocus for the hydraulic fracturing treatment, satisfying part of the corrective action requirements in NOAV No. 401124029 for the Rule 205A violation.

34.         On November 7, 2016, Bayswater submitted an Answer to the NOAV and provided an explanation of how future FracFocus disclosures and Form 42, Field Operations Notices, will be submitted on time, satisfying the remaining corrective action requirements in NOAV No. 401124029 for both the Rule 205A and Rule 316C violations.

Arellano R-10-9HN Well (NOAV 401123785)

 

35.         On February 8, 2016, Bayswater conducted a hydraulic fracturing treatment on the Arellano R-10-9HN Well. Bayswater did not submit a Form 42, Field Operations Notice, at least 48 hours prior to commencing this treatment.

36.         On February 18, 2016, Bayswater completed a hydraulic fracturing treatment on the Arellano R-10-9HN Well.

37.         At the latest, the disclosure of the treatment to FracFocus was due on April 18, 2016 pursuant to Rule 205A.

38.         On October 28, 2016, COGCC Staff issued NOAV No. 401123785 to Bayswater for violations of Rule 205A and Rule 316C at the Arellano R-10-9HN Well.

35.       On November 1, 2016, Bayswater submitted disclosures to FracFocus for the hydraulic fracturing treatment, satisfying part of the corrective action requirements in NOAV No. 401123785 for the Rule 205A violation.

36.       On November 7, 2016, Bayswater submitted an Answer to the NOAV and provided an explanation of how future FracFocus disclosures and Form 42, Field Operations Notices, will be submitted on time, satisfying the remaining corrective action requirements in NOAV No. 401123785 for both the Rule 205A and Rule 316C violations.

Arellano S-10-9HN Well (NOAV 401121017)

 

39.         On January 21, 2016, Bayswater conducted a hydraulic fracturing treatment on the Arellano S-10-9HN Well.

40.         At the latest, the disclosure of the treatment to FracFocus was due on May 20, 2016 pursuant to Rule 205A.

41.         On October 28, 2016, COGCC Staff issued NOAV No. 401121017 to Bayswater for a violation of Rule 205A at the Arellano S-10-9HN Well.

42.         On November 1, 2016, Bayswater submitted disclosures to FracFocus for the hydraulic fracturing treatment, satisfying part of the corrective action requirements in NOAV No. 401121017.

43.         On November 7, 2016, Bayswater submitted an Answer to the NOAV and provided an explanation of how future FracFocus disclosures will be made on time, satisfying the remaining corrective action requirements in NOAV No. 401121017.

Arellano T-10-9HN Well (NOAV 401122915)

 

44.         On January 18, 2016, Bayswater conducted a hydraulic fracturing treatment on the Arellano T-10-9HN Well.

45.         At the latest, the disclosure of the treatment to FracFocus was due on May 17, 2016 pursuant to Rule 205A.

46.         On October 28, 2016, COGCC Staff issued NOAV No. 401122915 to Bayswater for a violation of Rule 205A at the Arellano T-10-9HN Well.

47.         On November 1, 2016, Bayswater submitted disclosures to FracFocus for the hydraulic fracturing treatment, satisfying part of the corrective action requirements in NOAV No. 401122915.

48.         On November 7, 2016, Bayswater submitted an Answer to the NOAV and provided an explanation of how future FracFocus disclosures will be made on time, satisfying the remaining corrective action requirements in NOAV No. 401121017.

Eisenach 1 Well (NOAV 401132217)

49.         Pursuant to conditions of approval on a Form 4, Sundry Notice, for the Eisenach 1 Well, Bayswater was required to conduct a bradenhead test prior to initiating repair operations on the Well and submit a Form 17, Bradenhead Test Report, 10 days after the test (Doc. No. 401072821).

50.         On July 21, 2016, Bayswater performed a bradenhead test on the Well (Doc. No. 401139649).

51.         On July 21-27, 2016, Bayswater performed repair activities, modified the repair operations, and then plugged the Well (Doc. Nos. 401075664 & 401086570).

52.         On October 28, 2016, COGCC Staff issued NOAV No. 401132217 to Bayswater for a violation of Section 34-60-121(1), C.R.S. (Violation of a Permit Condition) of the Oil and Gas Conservation Act (“Act”) at the Eisenach 1 Well.

53.         On October 31, 2016, Bayswater submitted a Form 17, Bradenhead Test Report, for the July 21, 2016 test (Doc. No. 401139649).

54.         On November 7, 2016, Bayswater submitted an Answer to the NOAV and provided an explanation of how bradenhead testing will be timely completed in the future, satisfying the corrective action requirements in NOAV No. 401132217.

PENALTY CALCULATION

55.         Pursuant to Rule 523 and the Commission’s Enforcement Guidance and Penalty Policy, Hearings staff calculated a penalty of $35,689 based on the following:

NOAV

Rule/

Act

Daily Penalty

Start Date

End Date

Days

Duration Matrix

Total Penalty

401123787

205A

$200

4/11/2016

4/18/2016

7

N

$1,400

401122866

205A

$200

3/26/2016

4/18/2016

23

Y

$2,390

401124027

205A

$200

4/11/2016

4/18/2016

7

N

$1,400

401121857

205A

$200

4/16/2016

4/18/2016

2

N

$400

401121857

316C

$2,500

1/27/2016

1/28/2016

1

N

$2,500

401124042

316C

$2,500

1/27/2016

1/28/2016

1

N

$2,500

401124032

316C

$2,500

2/3/2016

2/4/2016

1

N

$2,500

401124029

205A

$200

4/26/2016

11/1/2016

189

Y

$3,617

401124029

316C

$2,500

2/3/2016

2/4/2016

1

N

$2,500

401123785

205A

$200

4/18/2016

11/1/2016

197

Y

$3,641

401123785

316C

$2,500

2/8/2016

2/9/2016

1

N

$2,500

401121017

205A

$200

5/20/2016

11/1/2016

165

Y

$3,545

401122915

205A

$200

5/17/2016

11/1/2016

168

Y

$3,554

401132217

34-60-121(1)

$200

7/31/2016

10/31/2016

92

Y

$3,242

TOTAL PENALTY

$35,689

 

a.    Application of the Duration Matrix  of the COGCC Enforcement Guidance and Penalty Policy for violations more than 10 days in duration;

b.    Class 1, Minor Impact for all violations of Rule 205A;

c.    Class 2, Minor Impact for all violations of Rule 316C;

d.    Reclassification of the violation of §34-60-121(1), C.R.S., to Class 1, Minor Impact to make the penalty appropriate to the nature of the violation;

e.    For the Rule 205A violations, start date of the overdue disclosure and end date of the submission of the disclosure to FracFocus;

f.     For the Rule 316C violations, one-day violation for commencement of treatment without prior approval;

g.    For the Section 34-60-121(1), C.R.S., violation, start date of the overdue Form 17, Bradenhead Test Report, and end date of the submission of the report;

h.    No aggravating or mitigating factors; and

i.      No pattern of violation, or gross negligence or knowing and willful misconduct.

AGREEMENT

 

      NOW, THEREFORE, based on the Findings and pursuant to Rule 522.e.(1) and the Commission’s Enforcement Guidance and Penalty Policy, the Director and Bayswater agree to request that the Commission enter the Order set forth below.

 

RECOMMENDED this 14th day of December, 2016.

  

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

 

 

 

By                                                                       

                                                        Britta Beckstead, Asst. Attorney General

 


 

AGREED TO AND ACCEPTED this ____ day of December 2016.

                                                 

BAYSWATER EXPLORATION & PRODUCTION LLC

 

 

                        By                                                                                          

Signature of Authorized Company Representative

                       

 

                                                                                                                                                           

Print Signatory Name and Title                  

 

ORDER

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

 

1.            Bayswater is found in violation of Rules 205A and 316C, and Section 34-60-121(1), C.R.S., as described above.

 

2.            Bayswater is assessed a penalty of $35,689 for these violations.

 

3.            Bayswater will pay $35,689, by certified check, within 30 days after this Order is mailed by the Commission.

 

4.            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 14 days prior to the pertinent compliance deadline or as soon as possible if 14 days prior notice is not feasible.

5.            Failure to pay the penalty by the above deadline is an independent violation that may be subject to additional penalties. 

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

7.            The Commission expressly reserves its right after notice and hearing, to alter, amend, or repeal any and/or all of the above Order. 


 

===================================================================

ENTERED this _____ day of _________ 2017 as of the ___ day of January 2017.

 

                                                            OIL AND GAS CONSERVATION COMMISSION

                                                            OF THE STATE OF COLORADO

 

 

                                                            By                                                                              

                                                                        Julie Murphy, Secretary

 

 

CERTIFICATE OF MAILING

 

On ___________, 2017, a true and accurate copy of Order 1V-613 was mailed by certified mail, return receipt requested to the following address:

 

Bayswater Exploration & Production LLC

Attn: Donald W. Barbula

730 17th St. Ste. 610

Denver, CO 80202

 

                                                            ____________________________________

                                                                                Margaret Humecki