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 FRAM OPERATING LLC, DELTA COUNTY, COLORADO |
) ) ) ) ) |
CAUSE NO. 1V
ORDER NO. 1V-530 DOCKET NO. 150900472 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. Fram Operating LLC (“Fram”) (Operator No. 10310) is the operator of the Hamilton 32-1 Well (API No. 05-029-06097) (“Well”) in Delta County, Colorado.
2. The Well has been shut in for longer than two years without a successful Mechanical Integrity Test (“MIT”).
3. On August 20, 2013 Commission Staff issued a Warning Letter to Fram requiring that it either perform an MIT or plug and abandon the Well by November 20, 2013. Fram failed to comply with this Warning Letter by November 20, 2013.
4. On June 10, 2015, Commission Staff issued a Notice of Alleged Violation (“NOAV”) (No. 2618135) to Fram, citing violations of the following COGCC Rules of Practice and Procedure, 2 CCR 404-1 (“Rule” or “Rules”).
a. Rule 326.b. (Shut-In Wells)
5. Fram submitted a Form 6, Notice of Intent to Abandon, on June 18, 2015 (Document No. 400853930) and reported the plugging operation complete on June 26, 2015 with a Form 6 Subsequent, filed on July 1, 2015 (Document No. 400860797).
6. Following factual investigation and legal review of the violations alleged in the NOAV, Hearing Staff now asserts Fram has committed the following violations:
a. One ten-day violation of Rule 326.b (All Shut-In Wells Shall Pass a Mechanical Integrity Test)
7. Pursuant to Rule 523 and the Commission’s Enforcement and Penalty Policy, Hearings Staff calculated a base penalty of $10,000 for this violation. The penalty calculation is based on the following:
a. The Commission discovered the violation before the June 6, 2014 effective date of HB 14-1356;
b. Daily base penalty of $1,000;
c. Statutory limit of 10 days for violations not resulting in significant impact;
d. No aggravating factors;
e. No mitigating factors;
f. No pattern of violation; and
g. No gross negligence or knowing and willful misconduct.
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 Fram Resources Inc agrees to settle the NOAV on the following terms and conditions:
I. Fram is found in violation of Rule 326.b.;
II. Fram will be assessed a penalty of $7,500. This includes a 25% discount as settlement inducement.
III. Fram will pay $7,500 within 30 days after this AOC is mailed by the Commission.
RECOMMENDED this 13th day of August, 2015.
OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
By
Peter J. Gowen, Enforcement Supervisor
AGREED TO AND ACCEPTED this day of August, 2015.
FRAM RESOURCES, INC.
By
Signature of Authorized Company Representative
Print Signatory Name
Title
ORDER
HAVING CONSIDERED the Agreement between the Director and Fram to resolve the NOAV, the COMMISSION ORDERS:
1. Fram is found in violation of Rule 326.b. described above.
2. Fram is assessed a total penalty of $7,500 for the rule violation described above.
3. Fram will pay $7,500 within 30 days after the Commission approves this Order.
4. 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.
5. 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 , 2015 as of the 14th day of September, 2015.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By
Julie Murphy, Secretary