BEFORE THE OIL
AND GAS CONSERVATION COMMISSION
OF
THE STATE OF COLORADO
IN THE MATTER OF ALLEGED VIOLATIONS OF THE ) CAUSE
NO. 1V
RULES AND REGULATIONS OF THE COLORADO OIL )
AND GAS CONSERVATION COMMISSION BY ) ORDER
NO. IV-256
PETROLEUM DEVELOPMENT CORPORATION, )
WELD COUNTY, COLORADO )
ADMINISTRATIVE ORDER BY CONSENT
FINDINGS
1.
On October 16, 2001, a Colorado Oil and Gas Conservation Commission (“COGCC”) Form
2, Application for Permit-to-Drill (“APD”) was approved for Petroleum Development
Corporation (“PDC”) to drill the Bujalski #41-25 Well located in the NE¼ NE¼ of
Section 25, Township 4 North, Range 68 West, 6th P.M.
2.
The APD for the Bujalski #41-25 Well specified the objective formation as the “J”
Sand. The APD was approved by the COGCC Director only for this formation.
3.
On March 11, 2002 the COGCC received from PDC a Completed Interval
Report, Form 5A, for the Bujalski #41-25 Well. The form stated that the Bujalski
#41-25 Well had been completed in the Codell Formation and that the Codell
Formation had been tested on January 11,
2002.
4.
On December 12, 2003, PDC contacted COGCC staff by letter and reported
that the Codell Formation had been completed in the Bujalski #41-25 Well
without proper APD approval.
5.
For the unauthorized completion of the Codell Formation in the Bujalski #41-25
Well, PDC should be found in violation of Rule 303.b., failure to have an
approved Application for Permit-to-Drill or Application for Permit to Recomplete
to the Codell Formation, Rule 301., not providing written notice of intention
to do work, and Section 34-60-117.(1) of the Oil and Gas Conservation Act, failure
to protect correlative rights of all owners in every field or pool.
6. Rule 523. specifies a base fine of One Thousand
dollars ($1,000) per day for each violation of Rules 301. and 303., and a base
fine for violations of the Oil and Gas Conservation Act shall be determined by
the Commission at its discretion.
7.
A monetary penalty of Five Thousand dollars
($5,000.00) should be assessed against PDC, in accordance with Rule 523.a. and Rule 523.d., for violation of Rules 303.b.,
301., and Section 34-60-117.(1) of the Oil and Gas Conservation Act. An
aggravating factor in determining the fine recommendation is that under Rule
523.d.(4) the violation had the potential to have a significant negative impact
on correlative rights of other parties. A mitigating factor in determining the
fine recommendation is that under Rule 523.d.(1) the violator self-reported the
violation.
ORDER
NOW, THEREFORE, IT IS ORDERED,
that Petroleum Development Corporation shall be found in violation of Rule 303.b., failure to have an approved
Application for Permit-to-Drill or Application for Permit to Recomplete to the Codell
Formation, Rule 301., not providing written notice of intention to do work, and
Section 34-60-117.(1) of the Oil and Gas Conservation Act, failure to protect
correlative rights of all owners in every field or pool for the Bujalski #41-25
Well located in the NE¼ NE¼ of Section 25, Township 4 North, Range 68 West, 6th
P.M.
IT
IS FURTHER ORDERED, that Petroleum Development Corporation shall be assessed a fine of Five Thousand
dollars ($5,000.00) payable within thirty (30) days of the date the order is approved
by the Commission for violations occurring on the Bujalski #41-25 Well.
IT
IS FURTHER ORDERED, that the provisions contained in the above order shall
become effective forthwith.
IT IS FURTHER ORDERED,
that the Commission expressly reserves its right after notice and hearing, to alter, amend, or repeal any and/or
all of the above orders.
IT IS FURTHER ORDERED, that under the State
Administrative Procedure Act the Commission considers this order to be final
agency action for purposes of judicial review within thirty (30) days after the
date this order is mailed by the Commission.
IT
IS FURTHER ORDERED, that an application for reconsideration by the Commission
of this order is not required prior to the filing for judicial review.
Recommended this day
of January, 2004.
OIL
AND GAS CONSERVATION COMMISSION
By
Morris J. Bell, Hearing Officer
Dated at Suite 801
1120 Lincoln Street
Denver, Colorado 80203
January 2, 2004
AGREED TO AND ACCEPTED THIS
_________DAY OF January, 2004.
PETROLEUM DEVELOPMENT CORPORATION
By
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Title
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