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 BONANZA CREEK ENERGY OPERATING COMPANY LLC, WELD COUNTY, COLORADO

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CAUSE NO. 1V

 

DOCKET NO. 16010007

TYPE:  ENFORCEMENT

ORDER NO. 1V-559

 

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.         Bonanza Creek Energy Operating Company LLC (“Bonanza Creek”) (Operator No. 08960) is the operator for Latham  31-34-1HNB Well (“Well”) (API 05-123 -37939) in Weld County, Colorado.

 

2.         Bonanza Creek reports that the Well was spud on October 25, 2013 (Form 4, Document No. 400488206). Prior to this date, Bonanza Creek failed to either (a) collect groundwater samples in the 12 months prior to setting conductor pipe and submit the laboratory analytical results to the COGCC within three months of sample collection or (b) submit a Form 4 Sundry Notice requesting an exception from the requirements of Rule 318.A.f.

 

3.         On November 16, 2015, Commission Staff issued a Notice of Alleged Violation (“NOAV”) (No. 200437972) to Bonanza Creek for violations related to its failure to collect baseline groundwater samples or requesting an exemption from the requirement. The NOAV cited violation of Rule 318A.f of the COGCC Rules of Practice and Procedure, 2 CCR 404-1 (“Rule”).

 

4.         On November 17, 2015, Bonanza Creek  filed a Form 4 - Sundry Notice (Document No. 400938787) requesting an exemption to Ground Water Sampling Requirements in Greater Wattenberg Area Rule 318A.e(4). This Form was approved November 18, 2015.

 

            5.         Following a factual investigation and legal review of the violations alleged in the NOAV, the Hearings Staff now asserts Bonanza Creek has committed the following violation:

 

One one-day violation of Rule 318.A.f. because Bonanza Creek failed to either (a) collect groundwater samples in the 12 months prior to setting conductor pipe and submit the laboratory analytical results to the COGCC within three months of sample collection or (b) submit a Form 4 Sundry Notice requesting an exception from the requirements of Rule 318.A.f.

 

6.         Pursuant to Rule 523 and the Commission’s Enforcement and Penalty Policy, Hearings staff calculated a penalty of $1,875 for this violation. The penalty calculation is based on the following:

 

·         Class 2 Violation;

·         Minor impact;

·         One day of violation;

·         $2,500 per day base penalty per violation;

·         25% settlement inducement:

·         No aggravating factors;

·         No mitigating factors;

·         No pattern of violation; and

·         No 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 and Penalty Policy, the Director proposes and Bonanza Creek agrees to settle the NOAV on the following terms and conditions:

 

I.          Bonanza Creek is found in violation of Rule 318.A.f. as described above.

 

II.         Bonanza Creek will be assessed a penalty of $1,875.

 

III.        Bonanza will pay $1,875 within 30 days after the approved AOC is mailed by the Commission. 

 

RECOMMENDED this 15th day of December, 2015.

 

 

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

 

 

 

By                                                                       

Peter J. Gowen, Enforcement Supervisor

 

 

 

AGREED TO AND ACCEPTED this ______day of December, 2015.

                                                                                                                                    BONANZA CREEK ENERGY OPERATING

COMPANY LLC

 

                             

                        By                                                                                          

                        Signature of Authorized Company Representative

                       

                                                                                                                       

                                    Print Signatory Name

                      

                                                                                                                                                                        Title

 

ORDER

 

HAVING CONSIDERED the Agreement between the Director and Bonanza Creek to resolve the NOAV, the COMMISSION ORDERS:

 

            1.         Bonanza Creek is found in violation of Rule 318.A.f. as described above.

 

2.         Rule 318.A.f. will be assessed a total penalty of $1,875 for the rule violation described above.

 

3.         Bonanza will pay $1,875 within 30 days after the approved AOC is mailed by the Commission. 

           

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. 

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ENTERED this _____ day of                     , 2015 as of the 26th day of January, 2016.

 

                                                            OIL AND GAS CONSERVATION COMMISSION

            OF THE STATE OF COLORADO

 

 

            By                                                                                          

                                                                        Julie Murphy, Secretary