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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
KERR-MCGEE OIL & GAS ONSHORE LP, WELD COUNTY, COLORADO
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CAUSE NO. 1V
DOCKET NO. 1307-OV-13
ORDER NO. 1V-417
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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.
On or around November 22, 2012,
Kerr-McGee Oil & Gas Onshore LP (“Kerr-McGee”) (Operator #47120)
spud the
REIGLE #29N-9HZ
(“Well”) (API # 05-123-36184) located in
the NW ¼, NW ¼, Section 4, Township 2 North, Range 65 West, 6th P.M.,
Weld County.
2.
On March 16, 2013, after completion operations
at the Well, a screwed fitting on the Well casing failed at 9:39 p.m. releasing
condensate and water (production fluid). This
incident also damaged an adjacent well head
for the Reigle 29C-9HZ Well (API 05-123-36185) and caused additional
release of production fluid from the second well. Both wells were brought under
control by approximately 6:05 a.m. on March 17, 2013. Most of the released
production fluid was confined to the pad site, but wind-carried spray impacted
an area west of the pad and liquids flowed offsite to the north. The total area
of impacts (including the runoff and wind-carried spray impacts) was
approximately 550 feet by 750 feet. Kerr-McGee recovered 2,229 barrels of
released liquids by vacuum truck and 13,710 cubic yards of impacted soil was
excavated and disposed at an authorized off-site location. Confirmation soil
samples confirmed the impacted soils had been removed and remaining soils met
Table 910-1 standards. Final remediation and all required corrective actions
were completed by April 1, 2013.
3.
Kerr-McGee submitted a Form 19, Spill Report on March 26, 2013, and a
Form 27, Remediation Work Plan on April 8, 2013.
COGCC Staff approved the Form 27 on April 8, 2013. The COGCC Staff has found no further
remedial action is required.
4.
On June 27, 2013, Commission Staff issued a Notice of Alleged Violation
(“NOAV”) (No. 200382372) citing a violation of the following rule:
Rule 907.a(1) which requires Operators to ensure that E&P waste is properly
stored, handled, transported, treated, recycled, or disposed to prevent
threatened or actual significant adverse environmental impacts to air, water,
soil or biological resources or to the extent necessary to ensure compliance
with the concentration levels in Table 910-1, with consideration to WQCC ground
water standards and classifications.
5.
Pursuant to Commission Rule 522.b.(3), the Director
proposes and Kerr-McGee agrees to settle the NOAV on the following terms:
a.
Kerr McGee shall pay a penalty of $42,500.
b.
Kerr McGee may satisfy up to 100% of the penalty by funding and carrying out an
approved public project as described herein, pursuant to Rule 523.e. Payment through the funding of a
public project shall offset the penalty amount on a dollar for dollar basis.
c.
Payment of any portion of the penalty not
designated or allocated to fund an approved public project shall be due 30 days
after the Director approves the proposed public project.
d.
If a public project is approved by the Director, Kerr-McGee shall provide
a written summary upon completion of the project, which shall detail project
expenditures, Kerr-McGee staff time devoted to the project, and qualitative and
quantitative benefits of the public project.
e.
By agreeing to this payment, Kerr McGee does
not concede to, consent to, or waives it right to challenge any penalty payments
that exceed the Commission’s statutory penalty authority in any future actions
or NOAVs.
6.
Payment of the fine pursuant to this AOC
resolves all alleged violations of law or regulation as set forth in the NOAV.
7.
Kerr-McGee agrees to the findings of this AOC
only for the purpose of expeditiously resolving the matter without a contested
hearing.
Pursuant to Rule 522.c.(3), entering into this AOC by Kerr-McGee shall not be
construed as an admission of the alleged violations for purposes other than
entering this AOC. Kerr-McGee fully reserves its right to contest the same in
any future action or proceeding other than a proceeding to enforce this AOC.
ORDER
NOW, THEREFORE, THE
COMMISSION ORDERS:
1.
Kerr McGee shall pay a penalty of $42,500, which may be in the form of a public
project as described herein. Payment
through the funding of a public project shall offset the cash penalty amount on
a dollar for dollar basis.
2.
Kerr McGee may satisfy up to 100% of the penalty by funding and carrying
out an approved public project pursuant to Rule 523.e. Kerr-McGee shall propose a public
project to the Director not later than 30 days after this order is approved by
the Commission if it elects to satisfy any portion of the penalty in this
manner.
3.
Payment of any portion of the penalty not
designated or allocated to fund an approved public project shall be due 30 days
after the Director approves the proposed public project.
4.
If a public project is approved by the Director, Kerr-McGee shall provide
a written summary upon completion of the project, which shall detail project
expenditures, Kerr-McGee staff time devoted to the project, and qualitative and
quantitative benefits of the public project.
5.
Payment of the fine pursuant to this AOC,
including funding of a public project, fully resolves all alleged violations of
law or regulation as set forth in the NOAV.
6. Entry of this Order
constitutes final agency action for purposes of judicial review 30 days after
the date this order is mailed by the Commission.
7. An application for
reconsideration by the Commission of this order is not required prior to the
filing for judicial review.
8. The provisions contained in
the above order shall become effective immediately.
RECOMMENDED this 16th day of July, 2013.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By
Peter J. Gowen, Enforcement Officer
AGREED TO AND ACCEPTED this ______day of July, 2013.
KERR-MCGEE OIL & GAS ONSHORE LP
By __________________________________________
Signature of Authorized Company Representative
____________________________________________
Print Signatory
Name
____________________________________________
Title
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The Commission heard and approved this matter on the 29th day of
July, 2013.
ENTERED this _____ day of
, 2013 as of the 29th day of July, 2013.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By____________________________________
Robert J. Frick, Secretary