BEFORE THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO - Martin Exploration fined $224,353.85 for contamination of water wells

 

BEFORE THE OIL AND GAS CONSERVATION COMMISSION

OF THE STATE OF COLORADO

IN THE MATTER OF RECONSIDERATION OF ORDER NO. 1-72 ) CAUSE NO. 1

ISSUED BY THE COLORADO OIL AND GAS CONSERVATION )

COMMISSION REQUESTED BY MARTIN EXPLORATION ) ORDER NO. 1-76

MANAGEMENT COMPANY, ADAMS COUNTY, COLORADO ) CORRECTED

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission at 8:30 a.m. on April 29, 1998, in Suite 801, The Chancery Building, 1120 Lincoln Street, Denver, Colorado, on Martin Exploration Management Company’s Motion for Reconsideration of the Commission’s Order No. 1-72 entered as a final order of the Commission on August 5, 1997 (the “Order”).

FINDINGS

The Commission finds as follows:

1. Martin Exploration Management Company ("Martin") is the applicant and an interested party in the subject matter of the above-referenced hearing.

2. Due notice of the time, place and purpose of the hearing has been given in all respects as required by law.

3. The Commission has jurisdiction over the subject matter and of the parties interested therein, and jurisdiction to enter this order.

4. On August 5, 1997, the Commission issued Order No. 1-72, in which the Commission found Martin and Patina Oil & Gas Corporation ("Patina") responsible parties pursuant to §34-60-124 (7) and (8), C.R.S., for the contamination of a water well owned by North Washington Water Users Association of Adams County ("NWWUA") located in the SE¼SE¼ of Section 10, Township 1 South, Range 68 West, 6th P.M. (the "Water Well"). The Order provides for the responsible parties to share in the costs to mitigate the significant adverse environmental impact associated with the contamination of the Water Well as outlined therein. The Order required that Martin to submit to the Oil and Gas Conservation Commission the sum of Two Hundred Twenty-Four Thousand Three Hundred Fifty-Three Dollars and Eighty-Five Cents ($224,353.85) representing Martin’s proportionate share of the mitigation costs to drill a new water well for NWWUA, and to replace a pumphouse destroyed by an explosion attributable to gas contamination. The Order provided for deposit of Martin and Patina’s mitigation money into an escrow account to be established at the State Treasurer’s Office.

5. On October 17, 1997, Martin filed with the Commission a Motion for Reconsideration of Order No. 1-72, claiming that the Commission exceeded its jurisdiction under §34-60-115, C.R.S., by bringing a proceeding for a violation more than one year after the date of the occurrence of the alleged violation (the “Motion for Reconsideration”).

6. At the January 7, 1998, hearing the Commission continued this matter on its own motion to the February, 1998 hearing due to a full hearing docket.

7. On February 4, 1998, Martin requested a continuance to the March 1998 hearing to discuss settlement possibilities with the involved parties. The Commission granted the requested continuance.

8. On March 12, 1998, the parties participated in a settlement conference at the Commission’s office to discuss resolution by settlement.

9. On March 25, 1998, Martin, Patina and NWWUA filed a joint Motion for Continuance to the April 1998 hearing to pursue settlement options discussed at the March 12, 1998 meeting. The Commission granted the requested continuance.

10. On April 27, 1998, Martin filed with the Commission a Motion For Leave to File Appearance pursuant to Rule 517. to allow Michael Dockterman, an attorney licensed in the state of Illinois to appear before the Commission for the purpose of arguing the Motion for Reconsideration. The Commission granted Martin’s motion.

11. At the April 29, 1998, hearing, William Odell, attorney for NWWUA objected to Martin’s Motion for Reconsideration stating that Martin received adequate notice of the August, 1997 hearing but chose not to appear, that the Commission had jurisdiction to enter the Order and that no reason existed to reopen the August, 1997 hearing proceedings or reconsider the Order. Ken Wonstolen, attorney for Patina stated Patina would take no position on the Motion for Reconsideration.

12. At the April 29, 1998, hearing, the Commission heard argument from Mr. Dockterman regarding why the Commission should reopen the August, 1997, proceedings and reconsider the findings and conclusions of Order No. 1-72.

13. The Commission finds that Martin did not demonstrate good cause sufficient for the Commission to reconsider the Order which was entered after a full hearing on the merits at the Commission’s August, 1997 hearing.

14. The Commission finds that Martin was properly noticed for the August, 1997, hearing for the determination of responsible party status pursuant to Rule 324.

15. The Commission finds that Martin chose not to attend the August, 1997 hearing after its receipt of notice either to contest the Commission’s jurisdiction over Martin or to otherwise present a case related to responsible party status. The Commission finds that Patina participated in the August, 1997 hearing as a potentially responsible party and that NWWUA intervened in the August, 1997 hearing as an interested party.

16. The Commission finds that it had jurisdiction to enter the Order after the full hearing on the responsible party status conducted August 5, 1997. The Commission finds that the August, 1997 hearing was noticed and conducted in accordance with the Colorado Oil and Gas Conservation Act §34-60-101 to -124, applicable Commission Rules and Regulations, and applicable portions of the State Administrative Procedures Act § 24-4-101 to -108, C.R.S. (the “APA”).

17. The Commission finds that upon conclusion of the hearing that the Commission mailed a copy of the Order to the responsible parties which contained the Commission’s findings and final order related to responsibility and mitigation liability.

18. The Commission finds that Martin did not seek judicial review of the Order within thirty (30) days after it was entered as required by §24-4-106, C.R.S., of the APA.

19. The Commission finds that the Order remains a final order of the Commission entered effective August 5, 1997, and that the Order is binding upon the parties determined to be responsible for the Water Well contamination in accordance with Rule 524 and § 34-60-124, C.R.S.

20. The Commission finds that Martin’s Motion for Reconsideration does not extend or otherwise reopen the period to appeal the Commission’s final findings and determination contained in Order No. 1-72.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the Motion to Reconsider Order No. 1-72 filed by Martin Exploration Management Company is hereby denied.

IT IS FURTHER ORDERED, that the provisions of Order No. 1-72 shall remain in effect.

IS FURTHER ORDERED, that the provisions contained in this order related to Martin’s Motion to Reconsider shall become effective on the date the order is entered.

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 __27^th _____ day of May, 1998, as of April 29, 1998.

AMENDED this _________ day of June, 1998, as of April 29, 1998.

OIL AND GAS CONSERVATION COMMISSION

OF THE STATE OF COLORADO

By ____________________________________

Patricia C. Beaver, Secretary

Dated at Suite 801

1120 Lincoln Street

Denver, Colorado 80203

June 3, 1998