| IN THE MATTER OF ALLEGED VIOLATIONS OF THE RULES AND REGULATIONS OF THE COLORADO OIL AND GAS CONSERVATION COMMISSION BY D J PRODUCTION SERVICES, INC. WELD COUNTY, COLORADO | Cause No. 1V Order No. 1V-232 |
REPORT OF THE COMMISSION
This cause came on for hearing before the Colorado Oil and Gas Conservation Commission on September 23, 2002 at 10:00 a.m. in Suite 801, The Chancery Building, 1120 Lincoln Street, Denver, Colorado on why DJ Production Services, Inc. is in violation of Rules 309., 310A., 319.b.(1), 319.b.(3) and 326.b., for the Cuykendall "C" No. 3 Well, and why the Commission should invoke the provisions of 34-60-122, C.R.S., as amended, providing for penalties for vio lations of the Rules and Regulations of the Commission.
FINDINGS
1. On October 26, 2001 COGCC staff issued a Notice of Alleged Violation ("NOAV") to D J Production Services, Inc. ("D J Production") for the Cuykendall "C" No. 3 Well. The NOAV cited violation of Rule 326.b., failure to conduct a mechanical integrity test on a well which has been shut-in more than two (2) years. The NOAV required that a mechanical integrity test be performed on the well by April 26, 2002.
2. On May 1, 2002, COGCC staff conducted an onsite inspection of the Cuykendall "C" No. 3 Well located in the NW1/4 NE1/4 of Section 25, Township 2 North, Range 63 West, 6th P.M. The inspection determined that the well was not producing.
3. A mechanical integrity test was not performed on the well by the abatement date of April 26, 2002.
4. Rule 523 specifies a base fine of one thousand dollars ($1000.00) for each violation of Rule 326.b.
5. At the time of the hearing, COGCC staff presented testimony and exhibits in support of the recommended order. No one from D J Production attended the hearing.
6. After deliberation, the Commission finds that D J Production is in violation of Rules 326.b. for the Cuykendall "C" No. 3 Well, a total monetary penalty of One Thousand Five Hundred dollars ($1,000.00) for violations of Rule 326.b. should be assessed against D J Production for this violation in accordance with Rule 523.a. for the Cuykendall "C" No. 3 Well, and that D J Production should either plug, abandon, and reclaim, perform and pass a mech anical integrity test, or produce the Cuykendall "C" No. 3 Well by November 1, 2002.
7. If D J Production does not plug, abandon and reclaim, perform and pass a mechanical integrity test, or produce the Cuykendall "C" No. 3 Well by November 1, 2002, the Commission should authorize the COGCC staff to claim D J Production's Thirty Thousand dollar ($30,000) blanket bond to plug, abandon and reclaim the well.
8. The Commission finds that D J Production has demonstrated a pattern of violation through lack of compliance with Order No. 1-97 and with the numerous Orders Finding Violation issued at the September 23, 2002 hearing.
ORDER
NOW, THEREFORE IT IS ORDERED, that D J Production Services, Inc. shall be found in violation of Rule 326.b. for the Cuykendall "C" No. 3 Well for failure to conduct a mechanical integrity test for the Cuykendall "C" No. 3 Well located in the NW1/4 NE1/4 of Section 25, Township 2 North, Range 63 West, 6th P.M.
IT IS FURTHER ORDERED, that D J Production Services, Inc. shall be assessed a total fine of One Thousand dollars ($1,000.00) for violation of Rule 326.b., for the above-described rule violation, payable within thirty (30) days of the date the order is entered by the Commission.
IT IS FURTHER ORDERED, that D J Production Services, Inc. shall either plug, abandon and reclaim, perform and pass a mechanical integrity test, or produce the Cuykendall "C" No. 3 Well by November 1, 2002. D J Production Services, Inc. shall notify COGCC staff prior to performing any work on the Cuykendall "C" No. 3 Well.
IT IS FURTHER ORDERED, that if D J Production Services, Inc. does not perform the work described above by November 1, 2002 and notify COGCC staff that the work has been performed, the COGCC staff shall be authorized to make a claim on D J Production Services, Inc.'s bond to plug, abandon and reclaim the Cuykendall "C" No. 3 Well.
IT IS FURTHER ORDERED, that if a claim on the bond is made, the Assistant Attorney General is hereby directed to do whatever is reasonably necessary to obtain and execute a judgment decree against the personal property of D J Production Services, Inc. located on or associated with the well site.
IT IS FURTHER ORDERED, that the Certificate of Clearance, Form 10, which authorizes transportation of oil and gas for this well, is hereby revoked.
IT IS FURTHER ORDERED, that no Applications for Permits-to-Drill and no Change of Operator, Form 10, shall be issued to or approved for D J Production Services, Inc., Jay Pape, or any other company of which Mr. Pape is a principal until such time as compliance with all Orders Finding Violation against D J Production Services, Inc. is secured.
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.
ENTERED this day of October, 2002, as of September 23. 2002
OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
By Patricia C. Beaver, Secretary
Dated at Suite 801 1120 Lincoln St. Denver, Colorado 80203 October 7, 2002