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BEFORE THE OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
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IN THE MATTER OF ALLEGED VIOLATIONS OF
THE RULES AND REGULATIONS OF THE COLORADO OIL AND GAS CONSERVATION COMMISSION BY
NOBLE ENERGY, INC., GARFIELD AND
WELD COUNTIES, COLORADO
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CAUSE NO. 1V
ORDER NO. 1V-391
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ADMINISTRATIVE ORDER BY CONSENT
(Pursuant to Rule 522.b.(3) of the Rules and Regulations of the
Colorado Oil and Gas Conservation
Commission, 2 CCR 404-1)
FINDINGS
1.
Rule 607.c. requires any gas analysis
indicating the presence of hydrogen sulfide (“H2S”) gas shall be
reported to the Commission and the local governmental designee (“LGD”).
Garfield County – Parachute Field (NOAV #01726642)
2.
In 2009, 2010, and the first six months of 2011, Noble collected H2S
information from a variety of different sources in the Parachute Field using
different types of tests, including Draeger tubes and gas chromatograph
analysis. These tests indicated the
presence of H2S for as many as 147 wells.
3.
In March 2009, Noble advised the COGCC and Bureau of Land Management
(“BLM”) that it had encountered H2S.
Noble did not report the test results to the Local Government Designee
(LGD) for Garfield County as required by Rule 607.c.
4.
On October 7, 2011, COGCC Staff issued Notice of Alleged Violation
(Parachute NOAV”) #01726642 to Noble, citing a violation of Rule 607.c. on the
below-described lands where H2S was found to be present:
Township 7 South, Range 94 West, 6th P.M.
Sections:
5, 8 and 17
Township 7 South, Range 95 West, 6th P.M.
Sections:
26, 34, 35 and 36
Township 7 South, Range 96 West, 6th P.M.
Sections:
26 and 35
Township 8 South, Range 95 West, 6th P.M.
Sections:
1, 2, 3 and 15
5.
Abatement or Corrective Actions required Noble to provide the COGCC with
test results for the Parachute Field where H2S was found to be
present, whether by Draeger tube, gas chromatograph, or other test, as well as
respond to questions listed in the Parachute NOAV by October 24, 2011. Noble
satisfied this requirement on time.
Weld County – Grover Field
6.
At various times during the first eight months of 2011, Noble collected H2S
information from a variety of different sources in the Grover Field using
different types of tests, including Draeger tubes and gas chromatograph
analysis. These tests indicated the
presence of H2S for as many as 78 wells.
7.
On October 3, 2011, Noble advised the COGCC that it had encountered H2S
in the Grover Field. On October 18,
2011, Noble reported the test results to the LGD for Weld County. The test results were not reported
to the COGCC when Noble first became aware of the presence of H2S in
March 2011.
8.
On October 7, 2011, COGCC Staff issued Notice of Alleged Violation
(“Grover NOAV”) #01726643 to Noble, for failure to provide timely notice to the
Weld County LGD for positive test results of hydrogen sulfide as required by
Rule 607.c. for Noble wells located in Townships 10, 11, and 12 North, Range 61
West, in Weld County. The Grover NOAV required that corrective actions be taken
by December 1, 2011.
9.
Abatement or Corrective Actions required Noble to provide the COGCC with
test results for the Grover Field where H2S was found to be present,
whether by Draeger tube, gas chromatograph, or other test, as well as respond to
questions listed in the Grover NOAV by December 1, 2011. Noble satisfied this
requirement on time.
Mitigating Factors
10.
Rule 523.d. specifies that any fine may be decreased by application of
mitigating factors. Applicable
mitigating factors in the case include:
a.
Rule 523.d.(2), the violator demonstrated prompt, effective and prudent
response to the violation, including assistance to any impacted parties.
b.
Rule 523.d.(3), the violator cooperated with the Commission, or other
agencies with respect to the violation.
c.
Rule 523.d.(6), the cost of correcting the violation reduced or
eliminated any economic benefit to the violator.
Third Party Hydrogen Sulfide Awareness Program
11. In
lieu of a fine payment, Noble and Staff agree to the following
Third Party
Hydrogen Sulfide Awareness Program:
A.
Noble will retain a qualified third-party firm (“Consultant”) to
establish a H2S Awareness Program and create written materials, which
can be utilized to educate local government designees (“LGDs”) and first
responders about H2S, how it is safely managed in the oil and gas
industry, and the precautions to ensure that H2S is properly managed. The H2S Awareness Program
shall include fire protection response, individual H2S protection,
chemical information, and potential emergency response procedures related to H2S
occurrences.
B.
In order to provide H2S awareness outreach to LGDs and first
responders, Noble’s Consultant will conduct one (1) presentation of the H2S
Awareness Program referenced in subparagraph (a)
in all four (4) quadrants of the State in coordination with COGCC Staff. The four (4) presentations will also
be open to COGCC staff. Noble and
COGCC will encourage industry participation through the Colorado Oil and Gas
Association (“COGA”).
C.
After the completion of the one (1) year of the H2S Awareness
Program, Noble will provide all final products associated with the H2S
Awareness Program to COGA, such that it may be a repository for H2S
information for the public and to allow COGA, to the extent it deems
appropriate, to continue with an H2S Awareness Program.
D.
Noble shall be responsible for all costs of conducting the awareness
program described in subparagraphs A and B above and will account to the COGCC
staff with respect to the expenditure of funds to support this program up to a
total program budget of $50,000. At
the direction of the COGCC, any funds in the program budget not expended by
Noble after the one year H2S Awareness Program, if any, shall be paid
to COGA for the sole purpose of maintaining and continuing awareness outreach
with respect to H2S.
Rule
522.c.(3) Disclaimer
12. Noble
agrees to the findings set forth in this AOC only for the purpose of
expeditiously resolving these matters without a contested hearing. Notwithstanding the above, and
pursuant to Rule 522.c.(3), Noble does not admit to any factual or legal
determinations made by the Commission herein, and fully reserves it right to
contest the same in any future action or proceeding, other than a proceeding to
enforce this AOC.
ORDER
NOW
THEREFORE, IT IS ORDERED that in exchange for resolving the proposed NOAVs,
Noble shall institute the awareness program as set forth above and shall arrange
for such program to be completed within one year of the date that this AOC is
accepted by the Commission.
IT IS
FURTHER ORDERED that Noble shall execute this Administrative Order by Consent no
later than fourteen (14) days after the date it is executed by the COGCC Staff
for recommendation of expedited approval by the Commission.
IT IS
FURTHER ORDERED that under the State Administrative Procedure Act, the
Commission consider this order to be final agency action for purposes of
judicial review within 30 days after the date this order is mailed by the
Commission.
IT IS
FURTHER ORDERED that the provisions contained in the above order shall become
effective immediately.
IT IS
FURTHER ORDERED that the Commission expressly reserves its right after Notice
and Hearing to alter, amend or repeal any or all of the above orders.
Recommended
this 25th
day
of July, 2012.
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Oil and Gas Conservation Commission of the State of Colorado
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BY:
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Peter J. Gowen, Enforcement Officer
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Agreed to
and accepted this ___ day of ___________, 2012.
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Noble
Energy, Inc.
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BY:
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Signature of
Authorized Company
Representative
Title:_______________________________
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The Commission heard this matter on August 20,
2012, in Suite 801, The Chancery Building, 1120 Lincoln Street, Denver,
Colorado, and approved this Administrative
Order by Consent. It is now a binding Order of the Commission.
ENTERED this 30th day of August 2012, as of the
20th
day of August, 2012.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By____________________________________
Robert J. Frick, Secretary
Dated at Suite 801
1120 Lincoln Street
Denver, Colorado 80203