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Colorado Regulators Ponder Possible Oil, Gas Reforms on Floods

Regulatory changes for oil and natural gas equipment and facility locations could be coming as a result of last fall’s floods that shut in a sizable number wells in the Denver-Julesburg (DJ) Basin (see Shale Daily, Sept. 20, 2013), the Colorado Oil and Gas Conservation Commission (COGCC) said Monday.

COGCC claimed there were more than 5,900 oil/gas wells within 500 feet of waterways in the state. "When these streams flood, nearby oil/gas facilities are at risk of damage, spills, environmental industry and lost production," regulators said in a 44-page report.

The report, "Lessons Learned in the Front Range Flood of September 2013," resulted from post-floods data collection from industry, first responders, federal/state agencies and conservation groups (see Shale Daily, Feb. 10).

The Colorado Oil & Gas Association (COGA) has said it would be publishing a separate report documenting the best management practices (BMP) developed.

COGA CEO Tisha Schuller told NGI's Shale Daily that the statye report essentially confirmed that the industry "was extraordinarily well prepared, responded in real time, and is committed to Colorado’s recovery.

"Our industry prepares for all sorts of disaster with emergency response plans and drills, and in this case, we were quick to respond with remote and manual shut-in of wells, deployment of thousands of employees, and implementation of 24-hour emergency operations centers." 

The COGCC completed more than 3,400 individual inspections of facilities impacted by flood waters and learned from data gathering, inspections, etc., said Director Matt Lepore.

Staff is not recommending changes to state statutes, but it proposed adopting additional best management approaches for oil and gas facilities near waterways, including remote shut-in capability and construction requirements. Staff also recommended that COGCC change some of policies and practices to be better prepared for future emergencies.

Among the possible changes are requirements to maintain well and production equipment inventories; remote shut-in equipment for all wells within a given distance of high-water marks; remote shut-in capability for wells in wildfire danger areas; and prohibiting pits within a designated distance of the ordinary high-water mark.

The restrictions on pits “has implications for operations on the Western Slope and in the Raton and San Juan areas," the report said. "Pits are often located near streams in those areas because those locations offer flat land available among steep slopes. This is a matter for further discussion during the development of a regulation."

Staff also recommended establishing emergency templates for the agency and an emergency response manual to guide activities.

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