BEFORE THE OIL AND GAS CONSERVATION
COMMISSION
OF THE STATE OF
IN THE MATTER
OF ALLEGED VIOLATIONS OF THE ) CAUSE NO. 1V
RULES AND
REGULATIONS OF THE
AND GAS CONSERVATION COMMISSION BY ) ORDER NO. 1V-315
DIVERSIFIED OPERATING CORPORATION, )
ADMINISTRATIVE
ORDER BY CONSENT
(Pursuant to Rule
522.b.(3) of the Rules and Regulations of the
FINDINGS
1.
In
October of 1988, the Long Draw #1-22 Well, located in the NE¼ NE¼ of Section 22,
Township 3 North, Range 62 West, 6th P.M., was drilled and abandoned by Diversified
Operating Corporation (“DOC”).
2.
In
May 1989, DOC re-entered the Long Draw #1-22 Well.
3.
On
March 4, 1996 a field inspection was conducted by Colorado Oil and Gas
Conservation Commission (“COGCC”) staff.
A pit was observed during the inspection.
4.
On
July 1, 1997, the COGCC received the Pit Inventory Report from DOC as required
by Rule 911. An unlined earthen produced
water pit was listed at the subject location.
The report also stated that this pit was located in a non-sensitive
area.
5.
On
February 9, 2004, a field inspection was conducted by COGCC staff. An unlined earthen pit was observed.
6.
On
or about December 22, 2005, the subject well was plugged and abandoned by DOC.
7.
On
March 15, 2006, a field inspection was conducted by COGCC environmental
staff. COGCC staff observed that the
unlined pit at the Long Draw #1-22 location had been backfilled. COGCC
staff collected a representative soil sample from the former pit location and
submitted it for analyses. The gas meter
shed had not been removed, and the former tank battery and pit location were
still surrounded by a fence. DOC did not
notify the COGCC of the pit closure verbally or by written communication.
8.
A
Total Petroleum Hydrocarbon (“TPH”) concentration of 51,000 milligrams per
kilograms (“mg/kg”) was detected in the soil sample collected on March 15, 2006. This exceeds the COGCC Allowable Concentrations
and Levels for TPH in non-sensitive areas, which is 10,000 mg/kg as specified
in Table 910-1.
9.
On
April 14, 2006, a Notice of Alleged Violation (“NOAV,” #1175577) was issued to
DOC for the Long Draw #1-22 Well. The
NOAV cited violations of the following COGCC Rules:
a. Rule 905.a., failure to submit a Site
Investigation and Remediation Workplan, Form 27, for prior COGCC approval
before closing an unlined production pit;
b.
Rule 907.a.(1)., failure to ensure that exploration
and production (“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;
c.
Rule 909.c., failure to submit a
Site Investigation and Remediation Workplan, Form 27, for prior COGCC approval;
d.
Rule 911.d. failure to submit an
Application For Permit For Unlined Pit, Form 15, for unlined production pits
outside sensitive areas constructed after July 1, 1995 and not closed by
December 30, 1997; and
e.
Rule 1004.b., failure to remove or
treat E&P waste remaining in a production pit before the pit was closed.
f.
Corrective
action specified that DOC submit a Site Investigation and Remediation Workplan,
Form 27.
10.
On April 25, 2006, the COGCC received a Form
27 with a written explanation regarding the alleged violations. The explanation stated that DOC was pressured
to close the pit by “third party sources.”
The explanation further stated that DOC did not intentionally ignore
COGCC rules regarding the filing of a Form 27.
11.
On October 25, 2006, COGCC staff conditionally
approved Form 27 for Remediation Project #3784.
DOC signed Form 27 agreeing to take initial action by digging up
contaminated soil, putting it in windrows, working it with manure, KenGro
BioSorb, and, once soil is regenerated, leveling the windrows to the natural
contour. Pursuant to Form 27, DOC also
agreed to reclaim the site by reseeding with a native mixture, and once grass
is established, removing the fence and, with prior notice to the COGCC, taking
a soil sample for testing of TPH concentrations.
12.
On October 25, 2006, the COGCC staff approved
DOC’s Form 27 with the following conditions:
a.
All oily soils within the pit and
other areas must be excavated for onsite remediation.
b.
Following excavation activity in the pit, a
representative soil sample must be collected from the pit bottom and submitted
for the following laboratory analyses: Total Recoverable Petroleum
Hydrocarbons, Sodium Adsorption Ratio, Electrical Conductivity, and pH.
c.
DOC must submit to COGCC all laboratory
results with a site map showing the pit location, soil sample locations, and
onsite land treatment area.
d.
The pit excavation must not be
backfilled without prior COGCC approval.
e.
DOC must collect confirmation
samples from the treated soils and submit them for laboratory analyses to
confirm remedial success that the land-treated oily waste incorporated in place
shall not exceed the allowable concentrations in Table 910-1 pursuant to Rule
907.e.(2).E.
13.
COGCC environmental staff has determined that
this site is located in a sensitive area because it is within the
14.
DOC has on two previous occasions, closed unlined
produced water pits without prior COGCC approval as required by Rule 905.a. These unlined pits were at the Green #5-3
tank battery located in the NE¼ NW¼ of Section 5, Township 7 North, Range 59
West, 6th P.M. and the Frank #27-16 tank battery located in the SE¼
SE¼ of Section 27, Township 8 North, Range 60 West, 6th P.M.
15.
COGCC staff notified DOC by letter, dated
February 9, 2005, that future closure of a production pit without prior COGCC
approval would result in the issuance of an NOAV and possible fine.
16.
Based
on the above findings, DOC should be found
in violation of Rules 905.a., failure to submit a Site Investigation and
Remediation Workplan, Form 27, for prior COGCC approval before closing an
unlined production pit; and Rule 907.a.(1)., failure 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.
17.
Rule 523. specifies a base fine of One
Thousand dollars ($1,000.00) per day for each violation of Rules 905.a. and
907.a.(1). and that fines are subject to adjustment based on aggravating and
mitigating factors set forth in subparagraph d. of Rule 523.
18.
A fine of Two
Thousand dollars ($2,000.00) should be assessed against DOC, in accordance with
Rule 523.a., for violation of Rules 905.a. and 907.a.(1). The fine
should be increased by One Thousand dollars ($1,000.00) pursuant to Rule
523.d.(1) because the violations involved recalcitrance or recidivism on the
part of the violator. A total fine of
Three Thousand dollars ($3,000) should be assessed against DOC.
19. DOC should be required to implement the
conditionally approved Form 27 within a reasonable period of time, but to be
completed no later than December 31, 2007.
The remediation project should be considered complete when the
analytical results for the soil samples collected from the pit area excavation
and the confirmation soil samples from the remediated soils meet the COGCC TPH
standard of 1,000 mg/kg for soils in sensitive areas. Additionally, the former pit and wellsite
areas should meet final reclamation standards pursuant to COGCC Rules.
ORDER
NOW, THEREFORE IT IS ORDERED, that Diversified Operating Corporation shall be
found in violation of Rule 905.a., failure to submit a Site
Investigation and Remediation Workplan, Form 27, for prior COGCC approval
before closing an unlined production pit; and Rule 907.a.(1)., failure 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.
IT IS FURTHER ORDERED, that
Diversified Operating Corporation’s violation of COGCC Rules at the Long Draw
#1-22 Well involved recalcitrance or recidivisim.
IT IS FURTHER ORDERED, that
Diversified Operating Corporation shall be assessed a total fine of Three Thousand
dollars ($3,000.00) for the two violations as adjusted by one aggravating
factor, which shall be payable within thirty (30) days of the date the order is
approved by the Commission.
IT IS FURTHER ORDERED, that Diversified Operating
Corporation shall implement the conditionally approved Form 27 within a
reasonable period of time, but to be completed no later than December 31, 2007. The remediation project shall be considered complete
when the analytical results for the soil samples collected from the pit area
excavation and the confirmation soil samples from the remediated soils meet the
COGCC TPH standard of 1,000 mg/kg for soils in sensitive areas. Additionally, the former pit and wellsite
areas shall meet final reclamation standards pursuant to COGCC Rules.
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.
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.
RECOMMENDED
this day
of August, 2007.
OIL
AND GAS CONSERVATION COMMISSION
OF THE STATE OF
By
Carol
Harmon
Enforcement Officer
Dated at
August 31, 2007
AGREED
TO AND ACCEPTED this _________day of September, 2007.
DIVERSIFIED OPERATING CORPORATION
By _______________________________________
Authorized Company Representative
__________________________________________
Print Name
__________________________________________
Title
============================================================================
This cause came on for hearing
before the Commission at 9:00 a.m. on November
5, 2007,
ENTERED
this________day of November, 2007, as of November 5, 2007.
OIL
AND GAS CONSERVATION COMMISSION
OF
THE STATE OF
By____________________________________
Patricia C. Beaver, Secretary
Dated
at
November 9, 2007