Code of Colorado Regulations

DEPARTMENT OF NATURAL RESOURCES
Oil and Gas Conservation Commission
PRACTICE AND PROCEDURE
2 CCR 404-1
[Editor’s Notes follow the text of the rules at the end of this CCR Document.]
100-SERIES DEFINITIONS
ACT shall mean the Oil and Gas Conservation Act of the State of Colorado.
ANCILLARY FACILITIES shall mean all of the equipment, buildings, structures, and improvements associated with or required for the operation of a well site, pipeline, or compressor facility. Ancillary facilities include, but are not limited to, roads, well pads, tank batteries, combustion equipment and pits and exclude gathering lines.
APPLICANT shall mean the person who institutes a proceeding before the Commission which it has standing to institute under these rules.
AQUIFER shall mean a geologic formation, group of formations or part of a formation that can both store and transmit ground water. It includes both the saturated and unsaturated zone but does not include the confining layer which separates two (2) adjacent aquifers.
ASSEMBLY BUILDING shall mean any building or portion of building or structure used for the regular gathering of fifty (50) or more persons for such purposes as deliberation, education, instruction, worship, entertainment, amusement, drinking or dining, or awaiting transport.
AUTHORIZED DEPUTY shall mean a representative of the Director as authorized by the Commission.
BARREL shall mean 42 (U.S.) gallons at 60° F. at atmospheric pressure.
BATTERY shall mean the point of collection (tanks) and disbursement (tank, meter, LACT unit) of oil or gas from producing well(s).
BEST MANAGEMENT PRACTICES (BMPs) are practices that are designed to prevent or reduce impacts caused by oil and gas operations to air, water, soil, or biological resources, and to minimize adverse impacts to public health, safety and welfare, including the environment and wildlife resources.
BRADENHEAD TEST AREA shall mean any area designated as a bradenhead test area by the Commission under Rule 207.b.
BUILDING UNIT shall mean a building or structure intended for human occupancy. A dwelling unit is equal to one (1) building unit, every guest room in a hotel/motel is equal to one (1) building unit, and every five thousand (5.000) square feet of building floor area in commercial facilities, and every fifteen thousand (15,000) square feet of building floor area in warehouses, or other similar storage facilities, is equal to one (1) building unit.
CEASE AND DESIST ORDER shall mean an order issued by the Commission or the Director pursuant to C.R.S. §34-60-121(5).
CENTRALIZED E&P WASTE MANAGEMENT FACILITY shall mean a facility, other than a commercial disposal facility regulated by the Colorado Department of Public Health and Environment, that (1) is either used exclusively by one owner or operator or used by more than one operator under an operating agreement; and (2) is operated for a period greater than three (3) years; and (3) receives for collection, treatment, temporary storage, and/or disposal produced water, drilling fluids, completion fluids, and any other exempt E&P wastes that are generated from two or more production units or areas or from a set of commonly owned or operated leases. This definition includes oil-field naturally occurring radioactive materials (NORM) related storage, decontamination, treatment, or disposal. This definition excludes a facility that is permitted in accordance with Rule 903 pursuant to Rule 902.e.
CHEMICAL(S) shall mean any element, chemical compound, or mixture of elements and/or compounds.
CHEMICAL INVENTORY shall mean a list of the Chemical Products (including Material Safety Data Sheets) brought to a well site for use downhole during drilling, completion, and workover operations, including fracture stimulations, and the maximum capacity of fuel stored on the oil and gas location during those operations. The Chemical Inventory shall include how much of the Chemical Product was used, how it was used, and when it was used.
CHEMICAL PRODUCT shall mean any substance consisting of one or more constituent chemicals that is marketed or sold as a commodity. Chemical Products shall not include substances that are known to be entirely benign, innocuous, or otherwise harmless, such as sand, walnut shells, and similar natural substances.
CLASSIFIED WATER SUPPLY SEGMENT shall mean perennial or intermittent streams, which are surface waters classified as being suitable or intended to become suitable for potable water supplies by the Colorado Water Quality Control Commission, pursuant to the Basic Standards and Methodologies for Surface Water Regulations (5 C.C.R. 1002-31).
COMMERCIAL DISPOSAL WELL FACILITY shall mean a facility whose primary objective is disposal of Class II waste from a third party for financial profit.
COMMISSION shall mean the Oil and Gas Conservation Commission of the State of Colorado.
COMPLETION. An oil well shall be considered completed when the first new oil is produced through wellhead equipment into lease tanks from the ultimate producing interval after the production string has been run. A gas well shall be considered completed when the well is capable of producing gas through wellhead equipment from the ultimate producing zone after the production string has been run. A dry hole shall be considered completed when all provisions of plugging are complied with as set out in these rules. Any well not previously defined as an oil or gas well, shall be considered completed ninety (90) days after reaching total depth. If approved by the Director, a well that requires extensive testing shall be considered completed when the drilling rig is released or six months after reaching total depth, whichever is later.
COMPLIANCE CHECKLIST shall mean a checklist of actions taken or on-site conditions that indicate compliance with specific regulatory requirements applicable to specific types of oil and gas facilities (e.g. drilling pads, pits, flowlines, etc.) or to specific types of oil and gas activities (e.g. closure, reclamation, spill response, etc.) developed by the Director.
COMPREHENSIVE DRILLING PLAN shall mean a plan created by one or more operator(s) covering future oil and gas operations in a defined geographic area within a geologic basin. The Plan may (a) identify natural features of the geographic area, including vegetation, wildlife resources, and other attributes of the physical environment; (b) describe the operator’s future oil and gas operations in the area; (c) identify potential impacts from such operations; (d) develop agreed-upon measures to avoid, minimize, and mitigate the identified potential impacts; and (e) include other relevant information.
CONTAINER shall mean any portable device in which a hazardous material is stored, transported, treated, disposed of, or otherwise handled.
CORNERING AND CONTIGUOUS UNITS when used in reference to an exception location shall mean those lands which make up the unit(s) immediately adjacent to and toward which a well is encroaching upon established setbacks.
CROP LAND shall mean lands which are cultivated, mechanically or manually harvested, or irrigated for vegetative agricultural production.
CUBIC FOOT of gas shall mean the volume of gas contained in one cubic foot of space at a standard pressure base and a standard temperature base. The standard pressure base shall be 14.73 psia, and the standard temperature base shall be 60° Fahrenheit.
D–J BASIN FOX HILLS PROTECTION AREA shall mean that area of the State consisting of Townships 5 South through Townships 5 North, Ranges 58 West through 70 West, and Township 6 South, Ranges 65 West through 70 West.
DAY shall mean a period of twenty-four (24) consecutive hours.
DEDICATED INJECTION WELL shall mean any well as defined under 40 C.F.R. §144.5 B, 1992 Edition, (adopted by the U.S. Environmental Protection Agency) used for the exclusive purpose of injecting fluids or gas from the surface. The definition of a dedicated injection well does not include gas storage wells.
DESIGNATED AGENT, when used herein shall mean the designated representative of any producer, operator, transporter, refiner, gasoline or other extraction plant operator, or initial purchaser.
DESIGNATED OUTSIDE ACTIVITY AREAS shall mean a well-defined outside area (such as a playground, recreation area, outdoor theater, or other place of public assembly) that is occupied by twenty (20) or more persons on at least forty (40) days in any twelve (12) month period or by at least five hundred (500) or more people on at least three (3) days in any twelve (12) month period.
DIRECTOR shall mean the Director of the Oil and Gas Conservation Commission of the State of Colorado or any member of the Director's staff authorized to represent the Director.
DOMESTIC GAS WELL shall mean a gas well that produces solely for the use of the surface owner. The gas produced cannot be sold, traded or bartered.
DRILLING PITS shall mean those pits used during drilling operations and initial completion of a well, and include:
ANCILLARY PITS used to contain fluids during drilling operations and initial completion procedures, such as circulation pits and water storage pits.
COMPLETION PITS used to contain fluids and solids produced during initial completion procedures, and not originally constructed for use in drilling operations.
FLOWBACK PITS used to contain fluids and solids produced during initial completion procedures.
RESERVE PITS used to store drilling fluids for use in drilling operations or to contain E&P waste generated during drilling operations and initial completion procedures.
EDUCATIONAL FACILITY shall mean any building used for legally allowed educational purposes for more than twelve (12) hours per week for more than six (6) persons. This includes any building or portion of building used for licensed day-care purposes for more than six (6) persons.
EMERGENCY ORDER shall mean an order issued by the Commission pursuant to C.R.S. §34-60-108(3).
EMERGENCY SITUATION for purposes of C.R.S. §34-60-121(5) and the rules promulgated thereunder shall mean a fact situation which presents an immediate danger to public health, safety or welfare.
EXPLORATION AND PRODUCTION WASTE (E&P WASTE) shall mean those wastes associated with operations to locate or remove oil or gas from the ground or to remove impurities from such substances and which are uniquely associated with and intrinsic to oil and gas exploration, development, or production operations that are exempt from regulation under Subtitle C of the Resource Conservation and Recovery Act (RCRA), 42 USC Sections 6921, et seq. For natural gas, primary field operations include those production-related activities at or near the wellhead and at the gas plant (regardless of whether or not the gas plant is at or near the wellhead), but prior to transport of the natural gas from the gas plant to market. In addition, uniquely associated wastes derived from the production stream along the gas plant feeder pipelines are considered E&P wastes, even if a change of custody in the natural gas has occurred between the wellhead and the gas plant. In addition, wastes uniquely associated with the operations to recover natural gas from underground storage fields are considered to be E&P waste.
FIELD shall mean the general area which is underlaid or appears to be underlaid by at least one pool; and “field” shall include the underground reservoir or reservoirs containing oil or gas or both. The words “field” and “pool” mean the same thing when only one underground reservoir is involved; however, “field” , unlike “pool” , may relate to two or more pools.
FINANCIAL ASSURANCE shall mean a surety bond, cash collateral, certificate of deposit, letter of credit, sinking fund, escrow account, lien on property, security interest, guarantee, or other instrument or method in favor of and acceptable to the Commission. With regard to third party liability concerns related to public health, safety and welfare, the term encompasses general liability insurance.
FIRST AID TREATMENT shall mean using a non-prescription medication at non-prescription strength; administering tetanus immunizations; cleaning, flushing, or soaking wounds on the surface of the skin; using wound coverings such as bandages, gauze pads, or butterfly bandages; using hot or cold therapy; using any non-rigid means of support such as elastic bandages; using temporary immobilization devices when transporting an accident victim; drilling of a fingernail or toenail to relieve pressure or draining fluid from a blister; using eye patches; removing foreign bodies from the eye using only irrigation or a cotton swab; removing splinters or foreign material from areas other than the eye by irrigation, tweezers, cotton swabs, or other simple means; using finger guards; using massages; or drinking fluids for the relief of heat stress.
FLOWLINES shall mean those segments of pipe from the wellhead downstream through the production facilities ending at: in the case of gas lines, the gas metering equipment; or in the case of oil lines the oil loading point or LACT unit; or in the case of water lines, the water loading point, the point of discharge to a pit, the injection wellhead, or the permitted surface water discharge point.
GAS FACILITY shall mean those facilities that process or compress natural gas after production-related activities which are conducted at or near the wellhead and prior to a point where the gas is transferred to a carrier for transport.
GAS STORAGE WELL means any well drilled for the injection, withdrawal, production, observation, or monitoring of natural gas stored in underground formations. The fact that any such well is used incidentally for the production of native gas or the enhanced recovery of native hydrocarbons shall not affect its status as a gas storage well.
GAS WELL shall mean a well, the principal production of which at the mouth of the well is gas, as defined by the Act.
GATHERING LINE shall mean a pipeline and equipment described below that transports gas from a production facility (ordinarily commencing downstream of the final production separator at the inlet flange of the custody transfer meter) to a natural gas processing plant or transmission line or main. The term “gathering line” includes valves, metering equipment, communication equipment, cathodic protection facilities, and pig launchers and receivers, but does not include dehydrators, treaters, tanks, separators, or compressors located downstream of the final production facilities and upstream of the natural gas processing plants, transmission lines, or main lines.
GREEN COMPLETION PRACTICES shall mean those practices intended to reduce emissions of salable gas and condensate vapors during cleanout and flowback operations prior to the well being placed on production.
GROUNDWATER means subsurface waters in a zone of saturation.
HIGH DENSITY AREA shall mean any tract of land determined to be a high density area in accordance with Rule 603.b.
HOSPITAL, NURSING HOME, BOARD AND CARE FACILITIES shall mean buildings used for the licensed care of more than five (5) in-patients or residents.
INACTIVE WELL shall mean any shut-in well from which no production has been sold for a period of twelve (12) consecutive months; any well which has been temporarily abandoned for a period of six (6) consecutive months; or, any injection well which has not been utilized for a period of twelve (12) consecutive months.
INDIAN LANDS shall mean those lands located within the exterior boundaries of a defined Indian reservation, including allotted Indian lands, in which the legal, beneficial, or restricted ownership of the underlying oil, gas, or coal bed methane or of the right to explore for and develop the oil, gas, or coal bed methane belongs to or is leased from an Indian tribe.
INTERVENOR shall mean a local government, or the Colorado Department of Public Health and Environment intervening solely to raise environmental or public health, safety and welfare concerns, or the Colorado Division of Wildlife intervening solely to raise wildlife resource concerns, in which case the intervention shall be granted of right, or a person who has timely filed an intervention in a relevant proceeding and has demonstrated to the satisfaction of the Commission that the intervention will serve the public interest, in which case the person may be recognized as a permissive intervenor at the Commission's discretion.
JAIL shall mean those structures where the personal liberties of occupants are restrained, including but not limited to, mental hospitals, mental sanitariums, prisons, reformatories.
LACT (“Lease Automated Custody Transfer” ) shall mean the transfer of produced crude oil or condensate, after processing or treating in the producing operations, from storage vessels or automated transfer facilities to pipelines or any other form of transportation.
LAND APPLICATION shall mean the disposal method by which E&P waste is spread upon or sometimes mixed into soils.
LAND TREATMENT shall mean the treatment method by which E&P waste is applied to soils and treated to result in a reduction of hydrocarbon concentration by biodegradation and other natural attenuation processes. Land treatment may be enhanced by tilling, disking, aerating, composting and the addition of nutrients or microbes.
LOCAL GOVERNMENT means a county, home rule or statutory city, town, territorial charter city or city and county, or any special district established pursuant to the Special District Act, C.R.S. §32-1-101 to 32-1-1505.
LOCAL GOVERNMENTAL DESIGNEE means the office designated to receive, on behalf of the local government, copies of all documents required to be filed with the local governmental designee pursuant to these rules.
LOG or WELL LOG shall mean a systematic detailed record of formations encountered in the drilling of a well.
MATERIAL SAFETY DATA SHEET (MSDS) shall mean the most current version of written or printed material concerning a hazardous chemical.
MEDICAL TREATMENT shall mean the management and care of a patient to combat a disease or disorder. An injury or illness is an abnormal condition or disorder. Injuries include cases such as, but not limited to, a cut, fracture, sprain, or amputation. Illnesses include both acute and chronic illnesses, such as, but not limited to, a skin disease, respiratory disorder, or poisoning. “Medical treatment” includes situations where a physician or other licensed health care professional recommends medical treatment but the employee does not follow the recommendation. “Medical treatment” does not include first aid treatment, as defined herein, visits to a physician or other licensed health care professional solely for observation or counseling, or the conduct of diagnostic procedures such as x-rays and blood tests, including the administration of prescription medications used solely for diagnostic purposes.
MINIMIZE ADVERSE IMPACTS shall mean, wherever reasonably practicable, to avoid adverse impacts to wildlife resources or significant adverse impacts to the environment from oil and gas operations, minimize the extent and severity of those impacts that cannot be avoided, mitigate the effects of unavoidable remaining impacts, and take into consideration cost-effectiveness and technical feasibility with regard to actions and decisions taken to minimize adverse impacts.
MINIMIZE EROSION shall mean implementing best management practices that are selected based on site-specific conditions and maintained to reduce erosion. Representative erosion control practices include, but are not limited to, revegetation of disturbed areas, mulching, berms, diversion dikes, surface roughening, slop drains, check dams, and other comparable measures.
MITIGATION with respect to wildlife resources shall mean measures that compensate for adverse impacts to such resources, including, as appropriate, habitat enhancement, on-site habitat mitigation, off-site habitat mitigation, or mitigation banking.
MULTI-WELL PITS shall mean pits used for treatment, storage, recycling, reuse, or disposal of E&P wastes generated from more than one (1) well that do not constitute a centralized E&P waste management facility and that will be in use for no more than three (3) years.
MULTI-WELL SITE shall mean a common well pad from which multiple wells may be drilled to various bottomhole locations.
NON-CROP LAND shall mean all lands which are not defined as crop land, including range land.
OIL AND GAS FACILITY shall mean equipment or improvements used or installed at an oil and gas location for the exploration, production, withdrawal, gathering, treatment, or processing of oil or natural gas.
OIL AND GAS LOCATION shall mean a definable area where an operator has disturbed or intends to disturb the land surface in order to locate an oil and gas facility.
OIL AND GAS OPERATIONS means exploration for oil and gas, including the conduct of seismic operations and the drilling of test bores; the siting, drilling, deepening, recompletion, reworking, or abandonment of an oil and gas well, underground injection well, or gas storage well; production operations related to any such well including the installation of flowlines and gathering systems; the generation, transportation, storage, treatment, or disposal of exploration and production wastes; and any construction, site preparation, or reclamation activities associated with such operations.
OIL WELL shall mean a well, the principal production of which at the mouth of the well is oil, as defined by the Act.
OPERATOR shall mean any person who exercises the right to control the conduct of oil and gas operations.
ORDINARY HIGH-WATER LINE shall mean the line that water impresses on the land by covering it for sufficient periods to cause physical characteristics that distinguish the area below the line from the area above it. Characteristics of the area below the line include, when appropriate, but are not limited to, deprivation of the soil of substantially all terrestrial vegetation and destruction of its agricultural vegetative value. A flood plain adjacent to surface waters is not considered to lie within the surface waters' ordinary high-water line.
ORPHAN WELL shall mean a well for which no owner or operator can be found, or where such owner or operator is unwilling or unable to plug and abandon such well.
ORPHANED SITE shall mean a site, where a significant adverse environmental impact may be or has been caused by oil and gas operations for which no responsible party can be found, or where such responsible party is unwilling or unable to mitigate such impact.
OWNER shall mean the person who has the right to drill into and produce from a pool and to appropriate the oil or gas produced therefrom either for such owner or others or for such owner and others, including owners of a well capable of producing oil or gas, or both.
PIT shall mean any natural or man-made depression in the ground used for oil or gas exploration or production purposes. Pit does not include steel, fiberglass, concrete or other similar vessels which do not release their contents to surrounding soils.
PLUGGING AND ABANDONMENT shall mean the cementing of a well, the removal of its associated production facilities, the removal or abandonment in-place of its flowline, and the remediation and reclamation of the wellsite.
POINT OF COMPLIANCE means one or more points or locations at which compliance with applicable groundwater standards established under Water Quality Control Commission Basic Standards for Groundwater, Section 3.11.4, must be achieved.
POLLUTION means man-made or man-induced contamination or other degradation of the physical, chemical, biological, or radiological integrity of air, water, soil, or biological resource.
The words POOL, PERSON, OWNER, PRODUCER, OIL, GAS, WASTE, CORRELATIVE RIGHTS and COMMON SOURCE OF SUPPLY are defined by the Act, and said definitions are hereby adopted in these Rules and Regulations. The word “operator” is used in these rules and regulations and accompanying forms interchangeably with the same meaning as the term “owner” except in Rules 301, 323, 401 and 530 where the word “operator” is used to identify the persons designated by the owner or owners to perform the functions covered by those rules.
PRODUCED AND MARKETED. These words, as used in the Act, shall mean, when oil shall have left the lease tank battery or when natural gas shall have passed the metering point and entered into the stream of commerce as its first step toward the ultimate consumer.
PRODUCTION FACILITIES shall mean all storage, separation, treating, dehydration, artificial lift, power supply, compression, pumping, metering, monitoring, flowline, and other equipment directly associated with oil wells, gas wells, or injection wells.
PRODUCTION PITS shall mean those pits used after drilling operations and initial completion of a well, including pits at natural gas gathering, processing and storage facilities, which constitute:
SKIMMING/SETTLING PITS used to provide retention time for settling of solids and separation of residual oil for the purposes of recovering the oil or fluid.
PRODUCED WATER PITS used to temporarily store produced water prior to injection for enhanced recovery or disposal, off-site transport, or surface-water discharge.
PERCOLATION PITS used to dispose of produced water by percolation and evaporation through the bottom or sides of the pits into surrounding soils.
EVAPORATION PITS used to contain produced waters which evaporate into the atmosphere by natural thermal forces.
PROTESTANT shall mean a person who has timely filed a protest in a relevant proceeding and has demonstrated to the Commission's satisfaction that the person filing the protest would be directly and adversely affected or aggrieved by the Commission's ruling in the proceeding, and that any injury or threat of injury sustained would be entitled to legal protection under the act.
PUBLIC WATER SYSTEM shall mean those systems listed in Appendix VI to these Rules. These systems provide to the public water for human consumption through pipes or other constructed conveyances, if such systems have at least fifteen (15) service connections or regularly serve an average of at least twenty-five (25) individuals daily at least sixty (60) days out of the year. Such definition includes:
(i) Any collection, treatment, storage, and distribution facilities under control of the operator of such system and used primarily in connection with such system.
(ii) Any collection or pretreatment storage facilities not under such control, which are used primarily in connection with such system.
The definition of “Public Water System” for purposes of Rule 317B does not include any “special irrigation district,” as defined in Colorado Primary Drinking Water Regulations (5 C.C.R. 1003.1).
RECLAMATION shall mean the process of returning or restoring the surface of disturbed land as nearly as practicable to its condition prior to the commencement of oil and gas operations or to landowner specifications with an approved variance under Rule 502.b.
REFERENCE AREA shall mean an area either (1) on a portion of the site that will not be disturbed by oil and gas operations, if that is the desired final reclamation; or (2) another location that is undisturbed by oil and gas operations and proximate and similar to a proposed oil and gas location in terms of vegetative potential and management, owned by a person who agrees to allow periodic access to it by the Director and the operator for the purpose of providing baseline information for reclamation standards, and intended to reflect the desired final reclamation.
RELEASE shall mean any unauthorized discharge of E&P waste to the environment over time.
REMEDIATION shall mean the process of reducing the concentration of a contaminant or contaminants in water or soil to the extent necessary to ensure compliance with the concentration levels in Table 910-1 and other applicable ground water standards and classifications.
RESERVE PITS shall mean those pits used to store drilling fluids for use in drilling operations or to contain E&P waste generated during drilling operations and initial completion procedures.
RESPONDENT shall mean a party against whom a proceeding is instituted, or a protestant who protests the granting of the relief sought in the application as provided in Rule 509.
RESPONSIBLE PARTY shall mean an owner or operator who conducts an oil and gas operation in a manner which is in contravention of any then-applicable provision of the Act, or of any rule, regulation, or order of the Commission, or of any permit, that threatens to cause, or actually causes, a significant adverse environmental impact to any air, water, soil, or biological resource. RESPONSIBLE PARTY includes any person who disposes of any other waste by mixing it with exploration and production waste so as to threaten to cause, or actually cause, a significant adverse environmental impact to any air, water, soil, or biological resource.
RESTRICTED SURFACE OCCUPANCY AREA shall mean the following:
- rocky mountain bighorn sheep production areas;
- desert bighorn sheep production areas;
- areas within 0.6 miles of any greater sage-grouse, Gunnison sage-grouse, and lesser prairie chicken leks (strutting and booming grounds);
- areas within 0.4 miles of any Columbian sharp-tailed grouse or plains sharp-tailed grouse leks (strutting grounds);
- areas within 1/4 mile of active Bald Eagle nest sites, Golden Eagle nest sites, or Osprey nest sites;
- areas within 1/2 mile of active Ferruginous Hawk nest sites, Northern Goshawk nest sites, Peregrine Falcon nest sites, or Prairie Falcon nest sites;
- areas located within 300 feet of the ordinary high-water mark of any stream segment located within designated Cutthroat Trout habitat; and
- areas within 300 feet of the ordinary high-water mark of a stream or lake designated by the Colorado Division of Wildlife as “Gold Medal.”
Maps showing and spatial data identifying the individual and combined extents of the above habitat areas shall be maintained by the Commission and made available on the Commission website, and copies of the maps shall be attached as Appendix VII. The extent of restricted surface occupancy areas is subject to update on a periodic but no more frequent than annual basis and may be modified only through the Commission’s rulemaking process, as provided in Rule 529. Any changes to restricted surface occupancy areas shall not affect Form 2As or Comprehensive Drilling Plans approved prior to the effective date of such changes.
SEISMIC OPERATIONS shall mean all activities associated with acquisition of seismic data including but not limited to surveying, shothole drilling, recording, shothole plugging and reclamation.
SENSITIVE AREA is an area vulnerable to potential significant adverse groundwater impacts, due to factors such as the presence of shallow groundwater or pathways for communication with deeper groundwater; proximity to surface water, including lakes, rivers, perennial or intermittent streams, creeks, irrigation canals, and wetlands. Additionally, areas classified for domestic use by the Water Quality Control Commission, local (water supply) wellhead protection areas, areas within 1/8 mile of a domestic water well, areas within 1/4 mile of a public water supply well, ground water basins designated by the Colorado Ground Water Commission, and surface water supply areas are sensitive areas.
SENSITIVE WILDLIFE HABITAT shall mean:
- mule deer critical winter range (being both mule deer winter concentration areas (that part of the winter range where densities are at least 200% of the surrounding winter range density during the same period used to define winter range in 5 out of 10 winters), and mule deer severe winter range (that part of the winter range where 90% of the individuals are located during the average 5 winters out of 10 from the first heavy snowfall to spring green-up)) (west of Interstate 25 and excluding Las Animas County);
- elk winter concentration areas (west of Interstate 25 and excluding Las Animas County);
- pronghorn antelope winter concentration areas (west of Interstate 25);
- bighorn sheep winter range;
- elk production areas (being that part of the overall range occupied by the females for calving) (west of Interstate 25 and excluding Las Animas County);
- Columbian sharp-tailed grouse and plains sharp-tailed grouse production areas (being an area that contains 80% of nesting and brood rearing habitat for any identified population);
- greater sage-grouse and Gunnison sage-grouse production areas (being an area that contains 80% of nesting and brood rearing habitat for any population identified in the Colorado Greater Sage-Grouse Conservation Plan (CDOW, 2008) or the Gunnison Sage-Grouse Range-Wide Conservation Plan (May 2005), respectively);
- lesser prairie chicken production areas (being an area that includes 80% of nesting and brood rearing habitat);
- black-footed ferret release areas;
- Bald Eagle nest sites and winter night roost sites; and
- Golden Eagle nest sites.
Maps showing and spatial data identifying the individual and combined extents of the above habitat areas shall be maintained by the Commission and made available on the Commission website, and copies of the maps shall be attached as Appendix VIII. The extent of sensitive wildlife habitat is subject to update on a periodic but no more frequent than biennial basis and may be modified only through the Commission’s rulemaking procedures, as provided in Rule 529. Any modifications to sensitive wildlife habitat shall not affect Form 2As or Comprehensive Drilling Plans approved prior to the effective date of such changes.
SHUT-IN WELL shall mean a well which is capable of production or injection by opening valves, activating existing equipment or supplying a power source.
SIMULTANEOUS INJECTION WELL shall mean any well in which water produced from oil and gas producing zones is injected into a lower injection zone and such water production is not brought to the surface.
SOLID WASTE shall mean any garbage, refuse, sludge from a waste treatment plant, water supply plant, air pollution control facility, or other discarded material; including solid, liquid, semisolid, or contained gaseous material resulting from industrial operations, commercial operations, or community activities. Solid waste does not include any solid or dissolved materials in domestic sewage, or agricultural wastes, or solid or dissolved materials in irrigation return flows, or industrial discharges which are point sources subject to permits under the provisions of the Colorado Water Quality Control Act, Title 25, Article 8, C.R.S. or materials handled at facilities licensed pursuant to the provisions on radiation control in Title 25, Article 11, C.R.S. Solid waste does not include: (a) materials handled at facilities licensed pursuant to the provisions on radiation control in Title 25, Article 11, C.R.S.; (b) excluded scrap metal that is being recycled; or (c) shredded circuit boards that are being recycled.
SOLID WASTE DISPOSAL shall mean the storage, treatment, utilization, processing, or final disposal of solid wastes.
SPECIAL FIELD RULES shall mean those rules promulgated for and which are limited in their application to individual pools or fields within the State of Colorado.
SPECIAL PURPOSE PITS shall mean those pits used in oil and gas operations, including pits at natural gas gathering, processing and storage facilities, which constitute:
BLOWDOWN PITS used to collect material resulting from, including but not limited to, the emptying or depressurizing of wells, vessels, or gas gathering systems.
FLARE PITS used exclusively for flaring gas.
EMERGENCY PITS used to contain liquids during an initial phase of emergency response operations related to a spill/release or process upset conditions.
BASIC SEDIMENT/TANK BOTTOM PITS used to temporarily store or treat the extraneous materials in crude oil which may settle to the bottoms of tanks or production vessels and which may contain residual oil.
WORKOVER PITS used to contain liquids during the performance of remedial operations on a producing well in an effort to increase production.
PLUGGING PITS used for containment of fluids encountered during the plugging process.
SPILL shall mean any unauthorized sudden discharge of E&P waste to the environment.
STORMWATER RUNOFF shall mean rain or snowmelt that flows over land and does not percolate into soil and includes stormwater that flows onto and off of an oil and gas location or facility.
STRATIGRAPHIC WELL means a well drilled for stratigraphic information only. Wells drilled in a delineated field to known productive horizons shall not be classified as “stratigraphic.” Neither the term “well” nor “stratigraphic well” shall include seismic holes drilled for the purpose of obtaining geophysical information only.
SUBSURFACE DISPOSAL FACILITY means a facility or system for disposing of water or other oil field wastes into a subsurface reservoir or reservoirs.
SURFACE WATER INTAKE shall mean the works or structures at the head of a conduit through which water is diverted from a classified water supply segment and/or source (e.g., river or lake) into the treatment plant.
SURFACE WATER SUPPLY AREA shall mean the classified water supply segments within five (5) stream miles upstream of a surface water intake on a classified water supply segment. Surface Water Supply Areas shall be identified on the Public Water System Surface Water Supply Area Map or through use of the Public Water System Surface Water Supply Area Applicability Determination Tool described in Rule 317B.b.
TANK shall mean a stationary vessel that is used to contain fluids, constructed of non-earthen materials (e.g. concrete, steel, plastic) that provide structural support.
TEMPORARILY ABANDONED WELL shall mean a well which is incapable of production or injection without the addition of one or more pieces of wellhead or other equipment, including valves, tubing, rods, pumps, heater-treaters, separators, dehydrators, compressors, piping or tanks.
TIER 1 OIL AND GAS LOCATION shall mean an oil and gas location where the slope is less than five percent (5%), the soil has low erosion potential, vegetative cover or permanent erosion resistance cover is greater than seventy-five percent (75%), the distance from a perennial stream or Classified Water Supply Segment is greater than five hundred (500) feet, and the oil and gas location size is less than one (1) acre, measured by the amount of surface disturbance at the time of the termination of a construction stormwater permit issued by the Colorado Department of Public Health and Environment.
TRADE SECRET shall mean any confidential formula, pattern, process, device, information, or compilation of information that is used in an employer’s business, and that gives the employer an opportunity to obtain an advantage over competitors who do not know or use it.
TRADE SECRET CHEMICAL PRODUCT shall mean a Chemical Product the composition of which is a Trade Secret.
VOLUNTARY SELF-EVALUATION shall mean a self-initiated assessment, audit, or review, not otherwise expressly required by environmental law, that is performed by any person or entity, for itself, either by an employee or employees employed by such person or entity who are assigned the responsibility of performing such assessment, audit, or review or by a consultant engaged by such person or entity expressly and specifically for the purpose of performing such assessment, audit, or review to determine whether such person or entity is in compliance with environmental laws.
WATERS OF THE STATE mean any and all surface and subsurface waters which are contained in or flow in or through this state, but does not include waters in sewage systems, waters in treatment works of disposal systems, water in potable water distribution systems, and all water withdrawn for use until use and treatment have been completed. Waters of the state include, but are not limited to, all streams, lakes, ponds, impounding reservoirs, wetlands , watercourses, waterways, wells, springs, irrigation ditches or canals, drainage systems, and all other bodies or accumulations of water, surface and underground, natural or artificial, public or private, situated wholly or partly within or bordering upon the State.
WELL when used alone in these Rules and Regulations, shall mean an oil or gas well, a hole drilled for the purpose of producing oil or gas, a well into which fluids are injected, a stratigraphic well, a gas storage well, or a well used for the purpose of monitoring or observing a reservoir.
WELL SITE shall mean the areas that are directly disturbed during the drilling and subsequent operation of, or affected by production facilities directly associated with, any oil well, gas well, or injection well and its associated well pad.
WILDCAT (EXPLORATORY) WELL means any well drilled beyond the known producing limits of a pool.
WILDLIFE RESOURCES shall mean fish, wildlife, and their aquatic and terrestrial habitats.
ZONE OF INCORPORATION shall mean the soil layer from the soil surface to a depth of twelve (12) inches below the surface.
ALL OTHER WORDS used herein shall be given their usual customary and accepted meaning, and all words of a technical nature, or peculiar to the oil and gas industry, shall be given that meaning which is generally accepted in said oil and gas industry.
200-SERIES GENERAL RULES
201. EFFECTIVE SCOPE OF RULES AND REGULATIONS
All rules and regulations of a general nature herein promulgated to prevent waste and to conserve oil and gas in the State of Colorado while protecting public health, safety, and welfare, including the environment and wildlife resources, shall be effective throughout the State of Colorado and be in force in all pools and fields except as may be amended, modified, altered or enlarged generally or in specific individual pools or fields by orders heretofore or hereafter issued by the Commission, and except where special field rules apply, in which case the special field rules shall govern to the extent of any conflict.
Nothing in these rules shall establish, alter, impair, or negate the authority of local and county governments to regulate land use related to oil and gas operations, so long as such local regulation is not in operational conflict with the Act or regulations promulgated thereunder.
These rules shall not apply to: (i) Indian trust lands and minerals; or (ii) the Southern Ute Indian Tribe within the exterior boundaries of the Southern Ute Indian Reservation. These rules shall apply to non-Indians conducting oil and gas operations on lands within the exterior boundaries of the Southern Ute Indian Reservation where both the surface and oil and gas estates are owned in fee by persons or entities other than the Southern Ute Indian Tribe, regardless of whether such lands are communitized or pooled. Additionally, the State of Colorado shall exercise criminal and civil jurisdiction within the Town of Ignacio, Colorado or within any other municipality within the Southern Ute Indian Reservation incorporated under the laws of Colorado, as provided by Sec. 5, Public Law No. 98-290 (1984).
If any portion of these Rules is found to be invalid, the remaining portion of the Rules shall remain in force and effect.
201A. EFFECTIVE DATE OF AMENDMENTS [Eff. 07/01/2009]
Unless otherwise specified in the rules, amendments to these rules adopted by the Commission in December 2008 shall become effective on July 1, 2009 for federal land and April 1, 2009 for all other land. Provided, that if any rule amendment specifies an effective date prior to July 1, 2009, then such amendment shall not become effective on federal land until July 1, 2009.
202. OFFICE AND DUTIES OF DIRECTOR
The office of Director of the Commission is hereby created. It shall be the duty of the Director to aid the Commission in the administration of the Act, as may be required of the Director from time to time and to act as hearing officer when so directed by the Commission.
203. OFFICE AND DUTIES OF SECRETARY
The office of Secretary to the Commission is hereby created. The duties of the Secretary shall be as determined from time to time by the Commission.
204. GENERAL FUNCTIONS OF DIRECTOR
The Director and the authorized deputies shall also have the right at all reasonable times to go upon and inspect any oil or gas properties, disposal facilities, or transporters facilities and wells for the purpose of making any investigation or tests to ascertain whether the provisions of the Act or these rules or any special field rules are being complied with, and shall report any violation thereof to the Commission.
205. ACCESS TO RECORDS
a. All producers, operators, transporters, refiners, gasoline or other extraction plant operators and initial purchasers of oil and gas within this State, shall make and keep appropriate books and records covering their operations in the State, including natural gas meter calibration reports, from which they may be able to make and substantiate the reports required by the Commission or the Director.
b. Beginning May 1, 2009 on federal land and April 1, 2009 on all other land, operators shall maintain MSDS sheets for any Chemical Products brought to a well site for use downhole during drilling, completion, and workover operations, including fracture stimulation.
c. Beginning June 1, 2009, operators shall maintain a Chemical Inventory by well site for each Chemical Product used downhole or stored for use downhole during drilling, completion, and workover operations, including fracture stimulation, in an amount exceeding five hundred (500) pounds during any quarterly reporting period. Operators shall also maintain a Chemical Inventory by well site for fuel stored at the well site during drilling, completion, and workover operations, including fracture stimulation, in an amount exceeding five hundred (500) pounds during any quarterly reporting period.
The five hundred (500) pound reporting threshold shall be based on the cumulative maximum amount of a Chemical Product present at the well site during the quarterly reporting period. Entities maintaining Chemical Inventories under this section shall update these inventories quarterly throughout the life of the well site. These records must be maintained in a readily retrievable format at the operator’s local field office. The Colorado Department of Public Health and Environment may obtain information provided to the Commission or Director in a Chemical Inventory upon written request to the Commission or the Director.
d. Where the composition of a Chemical Product is considered a Trade Secret by the vendor or service provider, Operators shall only be required to maintain the identity of the Trade Secret Chemical Product and shall not be required to maintain information concerning the identity of chemical constituents in a Trade Secret Chemical Product or the amounts of such constituents. The vendor or service provider shall provide to the Commission a list of the chemical constituents contained in a Trade Secret Chemical Product upon receipt of a letter from the Director stating that such information is necessary to respond to a spill or release of a Trade Secret Chemical Product or a complaint from a potentially adversely affected landowner regarding impacts to public health, safety, welfare, or the environment. Upon receipt of a written statement of necessity, information regarding the chemical constituents contained in a Trade Secret Chemical Product shall be disclosed by the vendor or service provider directly to the Director or his or her designee.
The Director or designee may disclose information regarding those chemical constituents to additional Commission staff members to the extent that such disclosure is necessary to allow the Commission staff member receiving the information to assist in responding to the spill, release, or complaint, provided that such individuals shall not disseminate the information further. In addition, the Director may disclose information regarding those chemical constituents to any Commissioner, the relevant County Public Health Director or Emergency Manager, or to the Colorado Department of Public Health and Environment’s Director of Environmental Programs upon request by that individual. Any information so disclosed to the Director, a Commission staff member, a Commissioner, a County Public Health Director or Emergency Manager, or to the Colorado Department of Public Health and Environment’s Director of Environmental Programs shall at all times be considered confidential and shall not become part of the Chemical Inventory, nor shall it be construed as publicly available. The Colorado Department of Public Health and Environment’s Director of Environmental Programs, or his or her designee, may disclose information regarding the chemical constituents contained in a Trade Secret Chemical Product to Colorado Department of Public Health and Environment staff members under the same terms and conditions as apply to the Director.
e. The vendor or service provider shall also provide the chemical constituents of a Trade Secret Chemical Product to any health professional who requests such information in writing if the health professional provides a written statement of need for the information and executes a Confidentiality Agreement, Form 35. The written statement of need shall be a statement that the health professional has a reasonable basis to believe that (1) the information is needed for purposes of diagnosis or treatment of an individual, (2) the individual being diagnosed or treated may have been exposed to the chemical concerned, and (3) knowledge of the chemical constituents of such Trade Secret Chemical Product will assist in such diagnosis or treatment. The Confidentiality Agreement, Form 35, shall state that the health professional shall not use the information for purposes other than the health needs asserted in the statement of need, and that the health professional shall otherwise maintain the information as confidential. Where a health professional determines that a medical emergency exists and the chemical constituents of a Trade Secret Chemical Product are necessary for emergency treatment, the vendor or service provider shall immediately disclose the chemical constituents of a Trade Secret Chemical Product to that health professional upon a verbal acknowledgement by the health professional that such information shall not be used for purposes other than the health needs asserted and that the health professional shall otherwise maintain the information as confidential. The vendor or service provider may request a written statement of need, and a Confidentiality Agreement, Form 35, from all health professionals to whom information regarding the chemical constituents was disclosed, as soon as circumstances permit. Information so disclosed to a health professional shall not become part of the Chemical Inventory and shall in no way be construed as publicly available.
f. Such books, records, inventories, and copies of said reports required by the Commission or the Director shall be kept on file and available for inspection by the Commission for a period of at least five years except for the Chemical Inventory, which shall be kept on file and available for inspection by the Commission for the life of the applicable oil and gas well or oil and gas location and for five (5) years after plugging and abandonment. Upon the Commission’s or the Director’s written request for information required to be maintained or provided under this section, the record-keeping entity or third-party vendor shall supply the Commission or the Director with the requested information within three (3) business days in a format readily-reviewable by the Commission or the Director, except in the instance where such information is necessary to administer emergency medical treatment in which case such information shall be provided as soon as possible. Information provided to the Commission or the Director under this section that is entitled to protection under state or federal law, including C.R.S. § 24-72-204, as a trade secret, privileged information, or confidential commercial, financial, geological, or geophysical data shall be kept confidential and protected against public disclosure unless otherwise required, permitted, or authorized by other state or federal law. Any disclosure of information entitled to protection under any state or federal law made pursuant to this section shall be made only to the persons required, permitted, or authorized to receive such information under state or federal law in order to assist in the response to a spill, release, or complaint and shall be subject to a requirement that the person receiving such information maintain the confidentiality of said information. The Commission or the Director shall notify the owner, holder, or beneficiary of any such protected information at least one (1) business day prior to any required, permitted, or authorized disclosure. This notification shall include the name and contact information of the intended recipient of such protected information, the reason for the disclosure, and the state or federal law authorizing the disclosure. Information so disclosed shall not become part of the Chemical Inventory and shall in no way be construed as publicly available.
g. The Director and the authorized deputies shall have access to all well records wherever located. All operators, drilling contractors, drillers, service companies, or other persons engaged in drilling or servicing wells, shall permit the Director, or authorized deputy, at the Director's or their risk, in the absence of negligence on the part of the owner, to come upon any lease, property, or well operated or controlled by them, and to inspect the record and operation of such wells and to have access at all times to any and all records of wells; provided, that information so obtained shall be kept confidential and shall be reported only to the Commission or its authorized agents.
h. In the event that the vendor or service provider does not provide the information required by Rules 205.d, 205.e, or 205.f directly to the Commission or a health professional, the operator is responsible for providing the required information.
i. In the event the operator establishes to the satisfaction of the Director that it lacks the right to obtain the information required by Rules 205.d, 205.e, or 205.f and to provide it directly to the Commission or a health professional, the operator shall receive a variance from these rule provisions from the Director.
206. REPORTS
a. All producers, operators, transporters, refiners, gasoline and other extraction plant operators, and initial purchasers of oil and gas within the State shall from time to time file accurate and complete reports containing such information and covering such geographic areas or periods as the Commission or Director shall require.
b. Compliance Checklist. Operators with oil and gas facilities in Garfield, Mesa, Gunnison, or Rio Blanco County shall complete and retain a Compliance Checklist, Form 36, for each oil and gas facility concerning actions taken or current on-site conditions that indicate compliance with specific requirements necessary to minimize adverse impacts.
(1) The Compliance Checklist, Form 36, shall demonstrate on-going compliance with requirements relating to stormwater management, protection of surface water drinking water supply areas, odor management, management of exploration and production waste, and maintenance of a Chemical Inventory.
(2) A new Compliance Checklist, Form 36, shall be completed and signed by an operator’s authorized representative for each oil and gas facility on or before August 15, 2009 and annually thereafter. An operator shall retain a current Compliance Checklist, Form 36, at the operator’s local field office at all times.
(3) An operator required to complete and retain a Compliance Checklist, Form 36, shall provide a copy of an oil and gas facility’s current Compliance Checklist, Form 36, to the Director within five (5) days of receiving a written request.
(4) The Compliance Checklist, Form 36, is not considered a report, record, account, or memorandum for purposes of C.R.S. § 34-60-121(2).
207. TESTS AND SURVEYS
a. Tests and surveys. When deemed necessary or advisable, the Commission is authorized to require that tests or surveys be made to determine the presence of waste or occurrence of pollution. The Commission, in calling for reports under Rule 206 and tests or surveys to be made as provided in this rule, shall designate the time allowed the operator for compliance, which provisions as to time shall prevail over any other time provisions in these rules.
b. Bradenhead monitoring.
(1) The Director shall have authority to designate specific fields or portions of fields as bradenhead test areas within which, on any well, the bradenhead access to the annulus between the production and surface casing, as well as any intermediate casing, shall be equipped with fittings to allow safe and convenient determinations of pressure and fluid flow. Any such proposed designation shall occur by notice describing the proposed bradenhead test area. Such notice shall be given to all operators of record within such area and by publication. The proposed designation, if no protests are timely filed, shall be placed upon the Commission consent agenda for the regular monthly meeting of the Commission following the month in which such notice is given, and shall be approved or heard by the Commission in accordance with Rule 520. Such designation shall be effective immediately, upon approval by the Commission.
(2) All operators within any bradenhead test area shall have thirty (30) days after the effective date of the designation to commence the taking of bradenhead pressure readings in all wells located therein which are equipped for such readings. The operator shall equip any well which is not so equipped within ninety (90) days of the effective date, and within thirty (30) days thereafter the operator shall take the required reading. Such readings shall include the date, time and pressure of each reading, and the type of fluid reported. Such readings shall be taken in bradenhead test areas annually, maintained at the operator's office for a period of five (5) years, and shall be reported to the Director upon written request.
208. CORRECTIVE ACTION
The Commission shall require correction, in a manner to be prescribed or approved by it, of any condition which is causing or is likely to cause waste or pollution; and require the proper plugging and abandonment of any well or wells no longer used or useful in accordance with such reasonable plan as may be prescribed by it.
209. PROTECTION OF COAL SEAMS AND WATER-BEARING FORMATIONS
In the conduct of oil and gas operations each owner shall exercise due care in the protection of coal seams and water-bearing formations as required by the applicable statutes of the State of Colorado.
Special precautions shall be taken in drilling and abandoning wells to guard against any loss of artesian water from the stratum in which it occurs and the contamination of fresh water by objectionable water, oil, or gas. Before any oil or gas well is completed as a producer, all oil, gas and water strata above and below the producing horizon shall be sealed or separated in order to prevent the intermingling of their contents.
210. SIGNS AND MARKERS
The operator shall mark each and every well in a conspicuous place, from the time of initial drilling until final abandonment, as follows:
a. Drilling and Recompletion Operations. Directional signs, no less than three (3) and no more than six (6) square feet in size, shall be provided during any drilling or recompletion operation, by the operator or drilling contractor. Such signs shall be at locations sufficient to advise emergency crews where drilling is taking place; at a minimum, such locations shall include (i) the first point of intersection of a public road and the rig access road and (ii) thereafter at each intersection of the rig access route, except where the route to the rig is clearly obvious to uninformed third parties. Signs not necessary to meet other obligations under these rules shall be removed as soon as practicable after the operation is complete.
b. Permanent Designations.
(1) Wells . Within sixty (60) days after the completion of a well, a permanent sign shall be located at the wellhead which shall identify the well and provide its legal location, including the quarter quarter section. When no associated battery is present, the additional information required under Rule 210.b.(2) shall be required on the sign.
(2) Batteries . Within sixty (60) days after the installation of a battery, a permanent sign shall be located at the battery. At the option of the operator, or at the request of local emergency response authorities, the sign may be placed at the intersection of the lease access road with a public, farm or ranch road if the referenced battery is readily apparent from such location. Such sign, which shall be no less than three (3) square feet and no more than six (6) square feet, shall provide: the name of the operator; a phone number at which the operator can be reached at all times; a phone number for local emergency services (911 where available); the lease name or well name(s) associated with the battery; the public road used to access the site; and the legal location, including the quarter quarter section. In lieu of providing the legal location on the permanent sign, it may be stenciled on a tank in characters visible from one-hundred (100) feet.
c. Centralized E&P Waste Management Facilities . The main point of access to a centralized E&P waste management facility shall be marked by a sign captioned “(operator name) E&P Waste Management Facility.” Such sign, which shall be no less than three (3) square feet and no more than six (6) square feet shall provide: a phone number at which the operator can be reached at all times; a phone number for local emergency services (911 where available); the public road used to access the facility; and the legal location, including quarter quarter section, of the facility.
d. Tanks and Containers.
(1) All tanks with a capacity of ten (10) barrels or greater shall by September 1, 2009 be labeled or posted with the following information:
A. Name of operator;
B. Operator’s emergency contact telephone number;
C. Tank capacity;
D. Tank contents; and
E. National Fire Protection Association (NFPA) Label.
(2) Containers that are used to store, treat, or otherwise handle a hazardous material and which are required to be marked, placarded, or labeled in accordance with the U.S. Department of Transportation’s Hazardous Materials Regulations, shall retain the markings, placards, and labels on the container. Such markings, placards, and labels must be retained on the container until it is sufficiently cleaned of residue and purged of vapors to remove any potential hazards.
e. General sign requirements . No sign required under this Rule 210. shall be installed at a height exceeding six (6) feet. Operators shall maintain signs in a legible condition, and shall replace damaged or vandalized signs within sixty (60) days. New operators shall update signs within sixty (60) days after change of operator approval is received from the Commission.
211. NAMING OF FIELDS
All oil and gas fields discovered in the State subsequent to the adoption of these rules and regulations shall be named by the Director or at the Director's direction.
212. SAFETY
For safety regulations regarding industry personnel, contact the U.S. Department of Labor, Occupational Safety and Health Administration, Regional Administrator, Colorado Region VIII, 1961 Stout Street, Suite 1576, Denver, Colorado 80201, telephone (303) 844-3061. For State Safety regulations regarding public safety see Rules 601-608.
213. FORMS UPON REQUEST
Forms required by the Commission will be furnished upon request. (Please see Procedures and Forms Guidelines)
214. LOCAL GOVERNMENTAL DESIGNEE
Each local government which designates an office for the purposes set forth in the 100 Series shall provide the Commission written notice of such designation, including the name, address and telephone number, facsimile number, electronic mail address, local emergency dispatch and other emergency numbers of the local governmental designee. It shall be the responsibility of such local governmental designee to ensure that all documents provided to the local governmental designee by oil and gas operators and the Commission or the Director are distributed to the appropriate persons and offices.
215. GLOBAL POSITIONING SYSTEMS
Global Positioning Systems (GPS) may be used to locate facilities used in oil and gas operations provided they meet the following minimum standards of the Commission:
a. Instruments rated as Differential Global Positioning System (DGPS) shall be used.
b. Instruments shall be capable of one (1) meter accuracy after differential correction.
c. All GPS data shall be differentially corrected by post processing prior to data submission.
d. Position dilution of precision (PDOP) values shall not be higher than six (6) and shall be included with location data.
e. Elevation mask (lowest acceptable height above the horizon) shall be no less than fifteen degrees (15°)
f. Latitude and longitude coordinates shall be provided in decimal degrees with an accuracy and precision of five (5) decimals of a degree using the North American Datum (NAD) of 1983 (e.g.; latitude 37.12345 N, longitude 104.45632 W).
g. Raw and corrected data files shall be held for a period of three (3) years.
h. Measurements shall be made by a trained GPS operator familiar with the theory of GPS, the use of GPS instrumentation, and typical constraints encountered during field activities.
216. COMPREHENSIVE DRILLING PLANS
a. Purpose. Comprehensive Drilling Plans are intended to identify foreseeable oil and gas activities in a defined geographic area, facilitate discussions about potential impacts, and identify measures to minimize adverse impacts to public health, safety, welfare, and the environment, including wildlife resources, from such activities. An operator’s decisions to initiate and enter into a Comprehensive Drilling Plan are voluntary.
b. Scope. A Comprehensive Drilling Plan shall cover more than one (1) proposed oil and gas location within a geologic basin, but its scope may otherwise be customized by the operator to address specific issues in particular areas. Although operators are encouraged to develop joint Comprehensive Drilling Plans covering the proposed activities of multiple operators where appropriate, Comprehensive Drilling Plans will typically cover the activities of one operator.
c. Information requirements. Operators are encouraged to submit the most detailed information practicable about the future activities in the geographic area covered by the Comprehensive Drilling Plan. Detailed information is more likely to lead to identification of specific impacts and agreement regarding measures to minimize adverse impacts. The information included in the Comprehensive Drilling Plan shall be decided upon by the operator, in consultation with other participants. Information provided by operators to federal agencies to obtain approvals for surface disturbing activities on federal land may be submitted in support of a Comprehensive Drilling Plan. The following information may be included as part of a Comprehensive Drilling Plan, depending on the circumstances:
(1) A U.S. Geological Survey 1:24,000 topographic map showing the proposed oil and gas locations, including proposed access roads and gathering systems reasonably known to the operator(s);
(2) A current aerial photo showing the proposed oil and gas locations displayed at the same scale as the topographic map to facilitate use as an overlay;
(3) Overlay maps showing the proposed oil and gas locations, including all proposed access roads and gathering systems, drainages and stream crossings, and existing and proposed buildings, roads, utility lines, pipelines, known mines, oil or gas wells, water wells known to the operator(s) and those registered with the State Engineer’s Office, and riparian areas;
(4) A list of all proposed oil and gas facilities to be installed within the area covered by the Comprehensive Drilling Plan over the time of the Plan and the anticipated timing of the installation;
(5) A plan for the management of exploration and production waste;
(6) A description of the wildlife resources at each oil and gas location;
(7) Wildlife information that is determined necessary after consultation with the Colorado Division of Wildlife;
(8) Locations of all proposed reference areas to be used as guides for interim and final reclamation;
(9) Past economic uses to which the land has been put in the previous ten (10) years reasonably known to the operator(s);
(10) Any planned variance requests that are reasonably known to the operator;
(11) Proposed best management practices or mitigation to minimize adverse impacts to resources such as air, water, or wildlife resources; and
(12) A list of all parties that participated in creating the Comprehensive Drilling Plan pursuant to Rule 216.d.(2).
d. Procedure.
(1) One or more operator(s) may submit a proposed Comprehensive Drilling Plan to the Commission, describing the operator’s reasonably foreseeable oil and gas development activities in a specified geographic area within a geologic basin. The Director may request an operator to initiate a Comprehensive Drilling Plan, but the decision to do so rests solely with the operator.
(2) The operator(s) shall invite the Colorado Department of Public Health and Environment, the Colorado Division of Wildlife, local governmental designee(s), and all surface owners to participate in the development of the Comprehensive Drilling Plan. In many cases, participation by these agencies and individuals will facilitate identification of potential impacts and development of conditions of approval to minimize adverse impacts.
(3) The operator(s), the Director, and participants involved in the Comprehensive Drilling Plan process shall review the proposal, identify information needs, discuss operations and potential impacts, and establish measures to minimize adverse impacts resulting from oil and gas development activities covered by the Plan.
(4) The Director shall place on the Commission’s hearing agenda in a timely manner a Comprehensive Drilling Plan that has been agreed to in writing by the operator(s) and that the Director considers suitable after consultation with the Colorado Department of Public Health and Environment and the Colorado Division of Wildlife, as applicable, and consideration of any other comments.
(5) The Director shall identify and document the agreed-upon conditions of approval for activities within the geographic area covered by the accepted Comprehensive Drilling Plan.
(6) Comprehensive Drilling Plans that have been accepted by the Commission shall be posted on the COGCC website, subject to any confidential or proprietary information belonging to the operator or other parties being withheld. Written information obtained or compiled from landowners and operators in conjunction with development of a Comprehensive Drilling Plan is exempt from disclosure to the public, provided that any page containing information subject to withholding under the Colorado Open Records Act is clearly labeled with the words “Confidential Information.” The Commission, the Colorado Department of Public Health and Environment, and the Colorado Division of Wildlife will keep all such data and information confidential to the extent allowed by the Colorado Open Records Act.
(7) Before initiating a Comprehensive Drilling Plan, operators are encouraged to discuss with the Director and, as appropriate, the Colorado Department of Public Health and Environment and the Colorado Division of Wildlife, the scope of the Plan, the schedule for its preparation, the information to be included, any public participation opportunities, and whether the Plan is intended to satisfy Form 2A requirements.
e. Variances and site-specific approvals.
(1) A Comprehensive Drilling Plan may incorporate variances to any of these rules, provided that all of the requirements for granting variances are met.
(2) Practices and conditions agreed to in an accepted Comprehensive Drilling Plan shall be:
A. Included as conditions of approval in any Form 2 or other permit for individual wells or other ground-disturbing activity covered by the Plan, where no Form 2A is required under Rule 303.d.(2).B.
B. Included as conditions of approval in any Form 2, Form 2A, or other permit for individual wells or other ground-disturbing activity covered by the Plan, where a Form 2A is required under Rule 303.d.(1).
Any permit-specific condition of approval for wildlife habitat protection will be included only with the consent of the surface owner.
f. Incentives. The following incentives shall apply as a means to facilitate and encourage the development of Comprehensive Drilling Plans by operators:
(1) Where the Comprehensive Drilling Plan contains information substantially equivalent to that which would be required in a Form 2A for the proposed oil and gas location and the Comprehensive Drilling Plan has been subject to procedures substantially equivalent to those required for a Form 2A, then a Form 2A shall not be required for a proposed oil and gas location that was included in the Comprehensive Drilling Plan and does not involve a variance from the Plan or a variance from these rules not addressed in the Comprehensive Drilling Plan.
(2) Where the Comprehensive Drilling Plan does not contain information substantially equivalent to that which would be required in a Form 2A for the proposed oil and gas location or the Comprehensive Drilling Plan has not been subject to procedures substantially equivalent to those required for a Form 2A or the operator seeks a variance from the Comprehensive Drilling Plans or a provision of these rules that is not addressed in the Plan, then a Form 2A shall be required for a proposed oil and gas location included in the Comprehensive Drilling Plan. However, the Director shall modify the informational and procedural requirements for such Form 2A to reflect the information included in and procedures used to approve the Comprehensive Drilling Plan and with input, where appropriate, from the Colorado Department of Public Health and Environment and the Colorado Division of Wildlife.
(3) Where a proposed oil and gas location is covered by an approved Comprehensive Drilling Plan and no variance is sought from such Plan or these rules not addressed in the Comprehensive Drilling Plan, then the Director shall give priority to and approve or deny an Application for Permit-to-Drill, Form 2, or Oil and Gas Location Assessment, Form 2A, within thirty (30) days of a determination that such application is complete pursuant to Rule 303.h unless significant new information is brought to the attention of the Director.
(4) Where the Director does not issue a decision on an Application for Permit-to-Drill, Form 2, or an Oil and Gas Location Assessment, Form 2A, for an oil and gas location as described in Rule 216.f.(3) above within thirty (30) days, then within five (5) days the Director shall provide the operator with a written explanation for the delay and the anticipated decision date, and the operator may request a hearing before the Commission. Such a hearing shall be expedited but will be held only after both the 20 days' notice and the newspaper notice are given as required by Section 34-60-108, C.R.S. However, the hearing may be held after the newspaper notice if all of the entities listed under Rule 503.b waive the 20-day notice requirement.
(5) Any party requesting a hearing pursuant to Rule 503.b.(7) on the Director’s approval of an Application for Permit-to-Drill, Form 2, or an Oil and Gas Location Assessment, Form 2A, for an oil and gas location that includes conditions of approval arrived at as part of an accepted Comprehensive Drilling Plan shall bear the burden of establishing that the conditions of approval are insufficient to protect public health, safety, welfare, the environment, and wildlife resources due to new information or changed circumstances occurring since the Comprehensive Drilling Plan was accepted by the Commission.
g. Duration. Once accepted by the Commission, a Comprehensive Drilling Plan shall be valid for a period of six (6) years.
h. Modification. An accepted Comprehensive Drilling Plan may be modified using the same process as that leading to acceptance of the original Plan either upon the initiative of the operator or upon the initiative of the Director and upon a showing that there has been a change in an applicable provision in these rules or a significant change to the basis upon which the Plan was developed. The review and approval of the modification shall focus only on the proposed modification(s).
300-SERIES DRILLING, DEVELOPMENT, PRODUCTION AND ABANDONMENT
301. RECORDS, REPORTS, NOTICES-GENERAL
Any written notice of intention to do work or to change plans previously approved must be filed with the Director, and must reach the Director and receive approval before the work is begun, or such approval may be given orally and, if so given, shall thereafter be confirmed to the Director in writing.
In case of emergency, or any situation where operations might be unduly delayed, any notice or information required by these rules and regulations to be given to the Director may be given orally or by wire, and if approval is obtained the transaction shall be promptly confirmed in writing to the Director, as a matter of record.
Immediate notice shall be given to the Director when public health or safety is in jeopardy. Notice shall also be given to the Director of any other significant downhole problem or mechanical failure in any well within ten (10) days.
The owner shall keep on the leased premises, or at the owner's headquarters in the field, or otherwise conveniently available to the Director, accurate and complete records of the drilling, redrilling, deepening, repairing, plugging or abandoning of all wells, and of all other well operations, and of all alterations to casing. These records shall show all the formations penetrated, the content and quality of oil, gas or water in each formation tested, and the grade, weight and size, and landed depth of casing used in drilling each well on the leased premises, and any other information obtained in the course of well operation. Such records on each well shall be maintained by any subsequent owner.
Whenever a person has been designated as an operator by an owner or owners of the lease or well, such an operator may submit the reports as herein required by the Commission.
302. COGCC Form 1. REGISTRATION FOR OIL AND GAS OPERATIONS
a. Prior to the commencement of its operations, all producers, operators, transporters, refiners, gasoline or other extraction plant operators, and initial purchasers who are conducting operations subject to this Act in the State of Colorado, shall, for purposes of the Act, file a Registration For Oil and Gas Operations, Form 1, with the Director in the manner and form approved by the Commission. Any producer, operator, transporter, refiner, gasoline or other extraction plant operator, and initial purchaser conducting operations subject to the Act who has not previously filed a Registration For Oil and Gas Operations, Form 1, shall do so. Any person providing financial assurance for oil and gas operators in Colorado shall file a Form 1 with the Director. All changes of address of the parties required to file a Form 1 shall be immediately reported by submitting a new Form 1.
b. Designation of Agent, Form 1A. Operator employees approved to submit documents shall be listed on a completed Designation of Agent, Form 1A. A company/individual other than the operator may be designated as an agent, and its representatives shall be listed on a completed Designation of Agent, Form 1A. This agency shall remain in effect until it is terminated in writing by submitting a new Designation of Agent, Form 1A. All changes to reported agent information shall be immediately reported by submitting a new Designation of Agent, Form 1A.
303. REQUIREMENTS FOR FORM 2, APPLICATION FOR PERMIT-TO-DRILL, DEEPEN, RE-ENTER, OR RECOMPLETE, AND OPERATE; FORM 2A, OIL AND GAS LOCATION ASSESSMENT.
a. FORM 2. APPLICATION FOR PERMIT-TO-DRILL, DEEPEN, RE-ENTER, OR RECOMPLETE, AND OPERATE.
(1) Approval by Director. Before any person shall commence operations for the drilling or re-entry of any well, such person shall file with the Director an application on Form 2 for a Permit-to-Drill, a completed (or, where it has been approved in advance, an approved) Oil and Gas Location Assessment, Form 2A, pay a filing and service fee established by the Commission (see Appendix III), and obtain the Director's approval before commencement of operations with heavy equipment.
(2) Operational conflicts. The Permit-to-Drill shall be binding with respect to any operationally conflicting local governmental permit or land use approval process.
(3) Exemptions. Wells drilled for stratigraphic information only shall be exempt from paying the filing and service fee. The re-entry of a well in a unitized, storage, or secondary recovery operation shall be exempt from the filing of Form 2 and from paying the filing and service fee. The notice of such intent to re-enter a well shall be filed on a Sundry Notice, Form 4.
b. A request to recomplete or deepen a well to a different reservoir or to side-track a well shall be filed on an Application for Permit-to-Drill, Form 2, with a filing and service fee established by the Commission (see Appendix III), along with a Sundry Notice, Form 4, detailing the work, and a wellbore diagram.
c. Attached to and part of the Permit-to-Drill, Form 2, as filed shall be a current 8½" by 11" scaled drawing of the entire section(s) containing the proposed well location with the following minimum information:
(1) Dimensions on adjacent exterior section lines sufficient to completely describe the quarter section containing the proposed well shall be indicated. If dimensions are not field measured, state how the dimensions were determined.
(2) The latitude and longitude of the proposed well location shall be provided on the drawing with a minimum of five (5) decimal places of accuracy and precision using the North American Datum (NAD) of 1983 (e.g.; latitude 37.12345 N, longitude 104.45632 W). If GPS technology is utilized to determine the latitude and longitude, all GPS data shall meet the requirements set forth in Rule 215. a. through h.
(3) For directional drilling into an adjacent section, that section shall also be shown on the location plat and dimensions on exterior section lines sufficient to completely describe the quarter section containing the proposed productive interval and bottom hole location shall be indicated. (Additional requirements related to directional drilling are found in Rule 321.)
(4) For irregular, partial or truncated sections, dimensions will be furnished to completely describe the entire section containing the proposed well.
(5) The field-measured distances from the nearer north/south and nearer east/west section lines shall be measured at ninety (90) degrees from said section lines to the well location and referenced on the plat. For unsurveyed land grants and other areas where an official public land survey system does not exist, the well locations shall be spotted as footages on a protracted section plat using Global Positioning System (GPS) technology and reported as latitude and longitude in accordance with Rule 215.
(6) A map legend.
(7) A north arrow.
(8) A scale expressed as an equivalent (e.g. - 1" = 1000').
(9) A bar scale.
(10) The ground elevation.
(11) The basis of the elevation (how it was calculated or its source).
(12) The basis of bearing or interior angles used.
(13) Complete description of monuments and/or collateral evidence found; all aliquot corners used shall be described.
(14) The legal land description by section, township, range, principal meridian, baseline and county.
(15) Operator name.
(16) Well name and well number.
(17) Date of completion of scaled drawing.
d. FORM 2A, OIL AND GAS LOCATION ASSESSMENT.
(1) A completed Oil and Gas Location Assessment, Form 2A, shall be submitted for any new oil and gas location, unless exempted as set forth below. For purposes of this section, “new oil and gas location” shall mean surface disturbance at a previously undisturbed site or surface disturbance for purposes of modifying or expanding an oil and gas location in existence on May 1, 2009 on federal land or April 1, 2009 on all other land.
(2) Exemptions. A new Form 2A shall not be required for the following:
A. Surface disturbance, other than drilling a new well or constructing a drilling or production pit, occurring at an existing oil and gas facility within the originally disturbed area, even if interim reclamation has been performed;
B. For an oil and gas location covered by an approved Comprehensive Drilling Plan and where such Comprehensive Drilling Plan contains information substantially equivalent to that which would be required for a Form 2A for the proposed oil and gas location and the Comprehensive Drilling Plan has been subject to procedures substantially equivalent to those required for a Form 2A, including but not limited to consultation with surface owners, local governments, the Colorado Department of Public Health and Environment or Colorado Division of Wildlife, where applicable, and public notice and opportunity to comment, and where the operator does not seek a variance from the Comprehensive Drilling Plan or a provision of these rules that is not addressed in the Plan;
C. Gathering lines;
D. Seismic operations;
E. Pipelines for oil, gas, or water; or
F. Roads.
(3) Information requirements. In all instances, the Form 2A requires the attachment of the following information. Where the information required under this section has been included in a federal Surface Use Plan of Operations meeting the requirements of Onshore Oil and Gas Order Number 1 (72 Fed. Reg. 10308 (March 7, 2007)), or for a federal Right of Way, Form 299, then the operator may attach the completed pertinent information and identify on the Form 2A where the information required under this section may be found therein.
A. A minimum of four (4) color photographs, one (1) of the staked location from each cardinal direction. Each photograph shall be identified by: date taken, well or location name, and direction of view.
B. A list of major equipment components to be used in conjunction with drilling and operating the well(s), including all tanks, pits, flares, combustion equipment, separators, and other ancillary equipment and a description of any pipelines for oil, gas, or water.
C. A scaled drawing showing all visible improvements within four hundred (400) feet of the proposed oil and gas location, with a horizontal distance and approximate bearing from the oil and gas location. Visible improvements shall include, but not be limited to, all buildings or residences, publicly maintained roads and trails, major above-ground utility lines, railroads, pipelines, mines, oil wells, gas wells, injection wells, water wells known to the operator and those registered with the Colorado State Engineer, known springs, plugged wells, known sewers with manholes, standing bodies of water, and natural channels including permanent canals and ditches through which water may flow. A description of surface uses within the four hundred (400) foot radius of a proposed oil and gas location, if any, shall be attached to the scaled drawing. If there are no visible improvements within four hundred (400) feet of a proposed oil and gas location, it shall be so noted on the Form 2A.
D. A topographic map showing all surface waters and riparian areas within one thousand (1,000) feet of the proposed oil and gas location, with a horizontal distance and approximate bearing from the oil and gas location.
E. An 8 1/2” by 11” vicinity or U.S. Geological Survey topographic map showing the access road from the highway or county road providing access to the proposed oil and gas location.
F. Designation of the current land use(s) and landowner’s designated final land use(s) and basis for setting reclamation standards.
i. If the final land use includes residential, industrial/commercial, or cropland and does not include any other uses, the land use should be indicated and no further information is needed.
ii. If the final land use includes rangeland, forestry, recreation, or wildlife habitat, then a reference area shall be selected and the following information shall be submitted:
aa. A topographic map showing the location of the site, and the location of the reference area; and
bb. Four (4) color photographs of the reference area, taken during the growing season of vegetation and facing each cardinal direction. Each photograph shall be identified by date taken, well or oil and gas location name, and direction of view. Provided that these photographs may be submitted at any time up to twelve (12) months after the Form 2A.
G. Natural Resources Conservation Service (NRCS) soil map unit description.
H. If the oil and gas location disturbance is to occur on lands with a slope ten percent (10%) or greater, or one (1) foot of elevation gain or more in ten (10) foot distance, then the following shall be required:
i. Construction layout drawing (construction and operation); and
ii. Location cross-section plot (construction and operation).
I. Where the proposed oil and gas location is for multiple wells on a single pad, a drawing showing proposed wellbore trajectory with bottom-hole locations.
J. A description of any applicant-proposed Best Management Practices or, where a variance from a provision of these rules is sought, any applicant-proposed measures to meet the standards for such a variance. With the consent of the surface owner, this may include mitigation measures contained in the relevant surface use agreement.
K. Where the proposed oil and gas location is covered by a Comprehensive Drilling Plan accepted pursuant to Rule 216, a list of any conditions of approval.
L. Contact information for the surface owner(s) and an indication as to whether there is a surface use agreement(s) or any other agreement(s) between the applicant and the surface owner(s) for the proposed oil and gas location.
M. Designation of whether the proposed oil and gas location is within sensitive wildlife habitat or a restricted surface occupancy area.
N. Where the proposed oil and gas location is within a zone defined in Rule 317B, Table 1, documentation that the applicant has provided notification of the application submittal to potentially impacted public water systems within fifteen (15) stream miles downstream.
O. Any additional data as reasonably required by the Commission as a result of consultation with the Colorado Department of Public Health and Environment or the Colorado Division of Wildlife.
(4) Form 2A requiring approval.
A. The Oil and Gas Location Assessment, Form 2A, requires Commission or Director approval prior to approval of Permits-to-Drill, Form 2, or other permit applications, in the following circumstances:
i. The proposed oil and gas location will disturb more than one (1) acre and is located in one of the following counties in Colorado:
aa. Garfield;
bb. Mesa;
cc. Gunnison; or
dd. Rio Blanco.
ii. The proposed oil and gas location requires consultation with the Colorado Division of Wildlife or the Colorado Department of Public Health and Environment, pursuant to Rules 306.c and 306.d, respectively;
iii. The local governmental designee requests consultation on the proposed oil and gas location pursuant to Rule 306.b; or
iv. Where the proposed oil and gas location requires submittal of a Form 2A and the proposed oil and gas facility:
aa. Is a production facility;
bb. Is servicing multiple wells; and
cc. Would not require any other Commission permit or facility registration.
B. Where the Oil and Gas Location Assessment, Form 2A, requires approval, the operator shall file the Form 2A prior to or concurrent with a Permit-to-Drill, Form 2, for individual wells to be constructed at the oil and gas location.
(5) Form 2A informational report.
Where a proposed oil and gas location is outside those situations described in Rule 303.d.(4), the Oil and Gas Location Assessment, Form 2A, is a report that does not require approval prior to approval of Permits-to-Drill, Form 2.
In these circumstances, the Form 2A shall be submitted concurrently with the Application for Permit-to-Drill, Form 2, or other permit applications, and it will be subject to completeness review pursuant to Rule 303.h.
e. Processing time for approvals under this section.
(1) In accordance with Rule 216.f.(3), where a proposed oil and gas location is covered by an approved Comprehensive Drilling Plan and no variance is sought from such Plan or these rules not addressed in the Comprehensive Drilling Plan, the Director shall give priority to and approve or deny an Application for Permit-to-Drill, Form 2, or, where applicable, Oil and Gas Location Assessment, Form 2A, within thirty (30) days of a determination that such application is complete pursuant to Rule 303.h, unless significant new information is brought to the attention of the Director.
(2) If the Director has not issued a decision on an Application for Permit-to-Drill, Form 2, or, where approval is required, an Oil and Gas Location Assessment, Form 2A, within seventy-five (75) days of a determination that such application is complete, the operator may request a hearing before the Commission on the permit application. Such a hearing shall be expedited but will be held only after both the 20 days' notice and the newspaper notice are given as required by Section 34-60-108, C.R.S. However, the hearing can be held after the newspaper notice if all of the entities listed under Rule 503.b waive the 20-day notice requirement.
f. Oil and gas locations in wetlands. In the event that an operator, otherwise required to file a Form 2A, acquires an Army Corps of Engineers permit pursuant to 33 U.S.C.A. §1342 and 1344 of the Water Pollution and Control Act (Section 404 of the federal “Clean Water Act” ) for construction of an oil and gas location, the operator shall so indicate on the Oil and Gas Location Assessment, Form 2A.
g. Revisions to Form 2 or Form 2A. Prior to approval of the Form 2 or Form 2A permit application, minor revisions or requested information may be provided by contacting the COGCC staff. After approval, any substantive changes shall be submitted for approval on a Form 2 or Form 2A. A Sundry Notice, Form 4, shall be submitted, along with supplemental information requested by the Director, when non-substantive revisions are made after approval, and no additional fee shall be imposed.
h. Incomplete applications . Applications for Permit-to-Drill, Form 2, or Oil and Gas Location Assessments, Form 2A, which are submitted without the required information and attachments, the proper signature, or the required information, shall be considered incomplete and shall not be reviewed or approved. The COGCC staff shall notify the applicant in not more than ten (10) days of its receipt of the application of such inadequacies, except that the Director shall notify the applicant of inadequacies within three (3) business days of its receipt where the proposed oil and gas location is covered by an accepted Comprehensive Drilling Plan. The applicant shall then have thirty (30) days from the date that it was contacted to correct or provide requested information , otherwise the application shall be considered withdrawn and the fee shall not be refunded.
i. Information requests after completeness determination. Subsequent to deeming an Application for Permit-to-Drill, Form 2, or Oil and Gas Location Assessment, Form 2A, complete, the Director may request from the operator additional information needed to complete review of and make a decision on such an application. Such an information request shall not affect an operator’s ability to request a hearing pursuant to Rule 303.e seventy-five (75) days from the date the Form 2 or Form 2A was originally determined to be complete pursuant to Rule 303.h.
j. Permit expiration.
(1) For Applications for Permit-to-Drill, Form 2. Approval of a Form 2 for a well permitted pursuant to an application submitted on or after July 1, 2009 on federal land or April 1, 2009 on all other land, and for which a Form 2A was also submitted in compliance with the rules as amended in December 2008, shall become null and void if drilling operations on the permitted well are not commenced within two (2) years after the date of approval. Approval of a Form 2 for a well permitted pursuant to an application submitted before July 1, 2009 on federal land or April 1, 2009 on all other land, or for which a Form 2A was not submitted in compliance with the rules as amended in December 2008, shall become null and void if drilling operations are not commenced on the permitted well within one (1) year after the date of approval. The Director shall not approve extensions to applications for Permit-to-Drill, Form 2.
(2) For Oil and Gas Location Assessments, Form 2A. If construction operations are not commenced on an approved oil and gas location within three (3) years after the date of approval, then the approval shall become null and void. The Director shall not approve extensions to Oil and Gas Location Assessments, Form 2A.
k. Permits in areas pending Commission hearing. The Director may withhold the issuance of a permit and the granting of approval of any Permit-to-Drill, Form 2, for any well or proposed well that is located in an area for which an application has been filed, or which the Commission has sought, by its own motion, to establish drilling units or to designate any tract of land as a high density area, in which case the hearing thereon shall be held at the next meeting of the Commission at which time the matter can be legally heard.
l. Special circumstances for permit issuance without notice or consultation. The Director may issue a permit at any time in the event that an operator files a sworn statement and demonstrates therein to the Director's satisfaction that:
(1) The operator had the right or obligation under the terms of an existing contract to drill a well; and the owner or operator has a leasehold estate or a right to acquire a leasehold estate under said contract which will be terminated unless the operator is permitted to immediately commence the drilling of said well; or
(2) Due to exigent circumstances (including a recent change in geological interpretation), significant economic hardship to a drilling contractor will result or significant economic hardship to an operator in the form of drilling standby charges will result.
In the event the Director issues a permit under this rule, the operator shall not be required to meet obligations to surface owners, local governmental designees, the Colorado Department of Public Health and Environment, or the Colorado Division of Wildlife under Rule 305 (except Rules 305.e.(4) and 305.e.(6), for which compliance will still be required) and 306. The Director shall report permits granted in such manner to the Commission at regularly scheduled monthly hearings.
m. Special circumstances for withholding approval of Application for Permit-to-Drill, Form 2, or Oil and Gas Location Assessment, Form 2A.
(1) The Director may withhold approval of any Application for Permit-to-Drill, Form 2, or Oil and Gas Location Assessment, Form 2A, for any proposed well or oil and gas location when, based on information supplied in a written complaint submitted by any party with standing under Rule 522.a.(1), other than a local governmental designee, or by staff analysis, the Director has reasonable cause to believe the proposed well or oil and gas location is in material violation of the Commission's rules, regulations, orders or statutes, or otherwise presents an imminent threat to public health, safety and welfare, including the environment, or a material threat to wildlife resources. Any such withholding of approval shall be limited to the minimum period of time necessary to investigate and dismiss the complaint, or to resolve the alleged violation or issue. If the complaint is dismissed or the matter resolved to the dissatisfaction of the complainant, such person may consult with the parties identified in Rule 503.b.(7).
(2) In the event the Director withholds approval of any Application for Permit-To-Drill, Form 2, or Oil and Gas Location Assessment, Form 2A, under this Rule 303.m., an operator may ask the Commission to issue an emergency order rescinding the Director's decision.
n. Suspending approved Permit-To-Drill, Form 2. Prior to the spudding of the well, the Director shall suspend an approved Permit-to-Drill, Form 2, if the Director has reasonable cause to believe that information submitted on the Permit-to-Drill, Form 2 was materially incorrect. Under the circumstances described in Rule 303.l.(1) or (2), an operator may ask the Commission to issue an emergency order rescinding the Director's decision.
o. Reclassification of stratigraphic well. If a test for productivity is made in a stratigraphic well, the well must be reclassified as a well drilled for oil or gas and is subject to all of the rules and regulations for well drilled for oil or gas, including filing of reports and mechanical logs.
p. Provisions for avoiding mine sites. Any person holding, or who has applied for, a permit issued or to be issued under §34-33-101 to 137, C.R.S., may at their election, notify the Director of such permit or application. Such notice shall include the name, mailing address and facsimile number of such person and designate by legal description the life-of-mine area permitted, or applied for, with the Division of Reclamation, Mining, and Safety. As soon as practicable after receiving such notice and designation, the Director shall inform the party designated therein each time that a Permit-to-Drill, Form 2, is filed with the Director which pertains to a well or wells located or to be located within said life-of-mine area as designated. The provisions of Rule 303.l.(1) and (2) will not be applicable to this rule.
304. FINANCIAL ASSURANCE REQUIREMENTS
Prior to drilling or assuming the operations for a well an operator shall provide financial assurance in accordance with the 700 Series rules. When an operator's existing wells are not in compliance with the 700 Series, the Director may withhold action on an Application for Permit-to-Drill, Form 2, or Oil and Gas Location Assessment, Form 2A, until such time as a hearing on the permit application is held by the Commission. Such hearing shall be held at the next regularly scheduled Commission hearing at which time the matter can be legally heard.
305. NOTICE, COMMENT, APPROVAL
a. Applicability. The provisions of Rule 305.e regarding surface owners shall not apply to federal or Indian-owned surface lands.
b. Posting.
(1) Form 2A. Upon receipt of an Oil and Gas Location Assessment, Form 2A, the Director shall, as provided by Rule 303.h, determine if the application is complete and, if so, post such Form 2A on the Commission’s website. The Commission shall provide concurrent electronic notice of such posting to the relevant local governmental designee (LGD) and the Colorado Division of Wildlife (where consultation is triggered pursuant to Rule 306.c) and the Colorado Department of Public Health and Environment (where consultation is triggered pursuant to Rule 306.d). The website posting shall clearly indicate:
A. The date on which the Form 2A was posted;
B. The date by which public comments must be received to be considered;
C. The address(es) to which the public may direct comments; and
D. Where the proposed oil and gas location is covered by an accepted Comprehensive Drilling Plan, directions for review of the Plan.
(2) Form 2. If an Application for Permit-to-Drill, Form 2, is concurrently filed with a Form 2A, that fact shall be noted in the posting provided herein. If a Form 2 is subsequently filed, only a summary notice of such filing, indicating that a Form 2A covering the well has been previously accepted or approved, shall be posted, with concurrent notice to the local governmental designee and, where consultation with one of those agencies is triggered, the Colorado Division of Wildlife or Colorado Department of Public Health and Environment.
c. Comment period. The Director shall not approve the Form 2A, or any associated Form 2, for twenty (20) days from posting pursuant to Rule 305.b, and shall accept and post on the Commission’s website immediately upon their receipt any comments received from the public, the local governmental designee, the Colorado Department of Public Health and Environment, or the Colorado Division of Wildlife regarding the proposed oil and gas location. The Director shall extend the comment period to thirty (30) days upon the written request during the twenty (20) day comment period by the local governmental designee, the Colorado Department of Public Health and Environment, the Colorado Division of Wildlife, the surface owner, or an owner of surface property who receives notice under Rule 305.e. The Director shall post the extension on the COGCC website within twenty-four (24) hours of receipt of the extension request.
d. Conditions of approval; issuance of permit. Upon the conclusion of the comment period and, where applicable, consultation with the Colorado Division of Wildlife or Colorado Department of Public Health and Environment pursuant to Rules 306.c. or 306.d, respectively, the Director may attach technically feasible and economically practicable conditions of approval to the Form 2 or Form 2A as the Director deems necessary to implement the provisions of the Act or these rules pursuant to Commission staff analysis or to respond to legitimate concerns expressed during the comment period. Provided, that an applicant under Rule 503 who claims that such a condition is not technically feasible, economically practicable, or necessary to implement the provisions of the Act or these rules, or to respond to legitimate concerns shall have the burden of proof on that issue before the Commission.
(1) Notice of decision. Upon making a decision on an Application for Permit-to-Drill, Form 2, or Oil and Gas Location Assessment, Form 2A, the Director shall promptly provide notification of the decision and any conditions of approval to the operator and to any party with standing to request a hearing before the Commission pursuant to Rule 503.b, unless such a party has waived in writing its right to such notice and the Director has been provided a copy of such waiver.
(2) Suspension of approval. If a party with standing to do so requests a hearing before the Commission pursuant to Rule 503.b on an Application for Permit-to-Drill, Form 2, or Oil and Gas Location Assessment, Form 2A, then it shall notify the Director in writing within ten (10) days after the issuance of the decision, setting forth the basis for the objection. Upon receipt of such an objection, the Director shall suspend the approval of the Form 2 or Form 2A and set the matter for an expedited adjudicatory hearing. Such a hearing shall be expedited but will only be held after both the 20 days' notice and the newspaper notice are given as required by Section 34-60-108, C.R.S. However, the hearing can be held after the newspaper notice if all of the entities listed under Rule 503.b waive the 20-day notice requirement. If such an objection is not received, the permit shall issue as proposed by the Director.
(3) Appeal. If the approval of a Form 2 or Form 2A is not suspended as provided for herein, the issuance of the approved Form 2 or Form 2A by the Director shall be deemed a final decision of the Commission, subject to judicial appeal.
e. Landowner notice; copy of advance notice to Local Governmental Designee. An operator making application for approval of an Oil and Gas Location Assessment, Form 2A, shall, upon receipt of a completeness determination from the Director, promptly provide the surface owner and owners of surface property within five hundred (500) feet of the proposed oil and gas location with the information set out in Rule 305.e.(1).A, below (“landowner notice” ); provided that notice to the owners of surface property within five hundred (500) feet of the proposed oil and gas location shall not be required in an area covered by Rules 318A or 318B. This notice is in addition to the statutorily required notice to surface owners (“advance notice” ), which must be provided thirty (30) days in advance of commencement of operations with heavy equipment for the drilling of a well. The operator may rely on the tax records of the assessor for the county in which the affected lands are located to identify the surface owner and the owners of surface property within five hundred (500) feet of the proposed oil and gas location for purposes of this section. A copy of the advance notice shall also be provided to the local government in whose jurisdiction the well is to be drilled, if such local government has registered its local governmental designee with the Commission. The notices required herein shall be accomplished by hand delivery or by certified mail, return-receipt requested.
(1) Content of notices.
A. Landowner Notice. The landowner notice shall include the Form 2A itself (without attachments), a copy of the information required under Rule 303.d.(3).B, 303.d.(3).C, and 303.d.(3).E and any additional information the operator deems appropriate and inform the recipient that the complete application (including attachments) may be reviewed on the COGCC website and that he or she may submit comments to the Director, as provided on the COGCC website. For the surface owner, this notice shall include a copy of the COGCC Informational Brochure for Surface Owners, a postage-paid, return-addressed post card whereby the surface owner may request consultation pursuant to Rule 306, and, where the oil and gas location is not subject to a surface-use agreement, a copy of the COGCC Onsite Inspection Policy (See Appendix or COGCC website).
B. Advance Notice. The advance notice must provide the operator’s name and contact information for a representative who may be contacted, describe on a site diagram or plat the proposed location of the well and any associated roads and production facilities, and indicate the expected date of commencement of operations with heavy equipment.
(2) Appointment of agent. The surface owner may appoint an agent, including its tenant, for purposes of subsequent notice and for consultation under Rule 306. Such appointment shall be made in writing to the operator and must provide the agent’s name, address, and telephone number.
(3) Tenants. With respect to notices given under this Rule 305, it shall be the responsibility of the notified surface owner to give notice of the proposed operation to the tenant farmer, lessee, or other party that may own or have an interest in any crops or surface improvements that could be affected by such proposed operation.
(4) Notice of subsequent well operations. An operator shall provide to the surface owner or agent at least seven (7) days advance notice of subsequent well operations with heavy equipment that will materially impact surface areas beyond the existing access road or well site, such as recompletion or refracturing of the well.
(5) Notice during irrigation season. If a well is to be drilled on irrigated crop lands between March 1 and October 31, the operator shall contact the surface owner or agent at least fourteen (14) days prior to commencement of operations with heavy equipment to coordinate drilling operations to avoid unreasonable interference with irrigation plans and activities.
(6) Final reclamation notice. Not less than thirty (30) days before any final reclamation operations are to take place pursuant to Rule 1004, the operator shall notify the surface owner. Final reclamation operations shall mean those reclamation operations to be undertaken when a well is to be plugged and abandoned or when production facilities are to be permanently removed. Such notice is required only where final reclamation operations commence more than thirty (30) days after the completion of a well.
(7) Waiver. Any of the notices required herein may be waived in writing by the surface owner, its agent, or the local governmental designee, provided that a waiver by a surface owner or its agent shall not prevent the surface owner or any successor-in-interest to the surface owner from rescinding that waiver if such rescission is in accordance with applicable law.
f. Posting. The operator shall, concurrent with the advance notice, post a sign at the intersection of the lease road and the public road providing access to the well site, of not less than two-feet by two-feet, providing the name of the proposed well, the legal location thereof, and the estimated date of commencement. Such sign shall be maintained until completion operations at the well are concluded.
306. CONSULTATION.
The operator shall consult in good faith, as provided below.
a. Consultation with surface owner . In locating roads, production facilities, and well sites, or other oil and gas operations, and in preparation for reclamation and abandonment, the operator shall consult in good faith with the surface owner, or the surface owner’s appointed agent as provided for in Rule 305. Such consultation shall occur at a time mutually agreed to by the parties prior to the commencement of operations with heavy equipment upon the lands of the surface owner.
(1) Information provided by operator . When consulting with the surface owner or appointed agent, the operator shall furnish a description or diagram of the proposed drilling location; dimensions of the drill site; topsoil management practices to be employed; and, if known, the location of associated production or injection facilities, pipelines, roads and any other areas to be used for oil and gas operations (if not previously furnished to such surface owner or if different from what was previously furnished).
(2) Good faith consultation . Such good faith consultation shall allow the surface owner or appointed agent the opportunity to provide comments to the operator regarding preferences for the timing of oil and gas operations and preferred locations for wells and associated facilities.
(3) Waiver. The requirement to consult with the surface owner may be waived by the affected surface owner or the surface owner’s appointed agent at any time by submittal to the operator in writing.
b. Consultation with local government.
(1) Local governments that have appointed a local governmental designee and have indicated to the Director a desire for consultation shall be given an opportunity to engage in such consultation concerning an application for Permit-to-Drill, Form 2, or an Oil and Gas Location Assessment, Form 2A, for the location of roads, production facilities and well sites prior to the commencing of operations with heavy equipment.
(2) Within fourteen (14) days of its notification pursuant to Rule 305, the local governmental designee may notify the Commission and the Colorado Department of Public Health and Environment by electronic mail of its desire to have the Colorado Department of Public Health and Environment consult on a proposed oil and gas location, based on concerns regarding public health, safety, welfare, or impacts to the environment.
c. Consultation with the Colorado Division of Wildlife. [Eff. 05/01/2009]
(1) Consultation to occur. [Eff. 05/01/2009]
A. Subject to the provisions of Rule 1202.d, the Colorado Division of Wildlife shall consult with the Commission, the surface owner, and the operator on an Oil and Gas Location Assessment, Form 2A, where: [Eff. 05/01/2009]
i. Consultation is required pursuant to a provision in the 1200-Series of these rules; [Eff. 05/01/2009]
ii. The operator seeks a variance from a provision in the 1200-Series of these rules; or [Eff. 05/01/2009]
iii. The Colorado Division of Wildlife requests consultation because the proposed oil and gas location would be within areas of known occurrence or habitat of a federally threatened or endangered species, as shown on the Colorado Division of Wildlife Species Activity Mapping (SAM) system. [Eff. 05/01/2009]
B. The Commission shall consult with the Colorado Division of Wildlife when an operator requests a modification of an existing Commission order to increase well density or otherwise proposes to increase well density to more than one (1) well per forty (40) acres, or the Commission develops a basin-wide order involving wildlife or wildlife-related environmental concerns or protections. [Eff. 05/01/2009]
C. Notwithstanding the foregoing, the requirement to consult with the Colorado Division of Wildlife may be waived by the Colorado Division of Wildlife at any time. [Eff. 05/01/2009]
(2) Procedure for consultation. [Eff. 05/01/2009]
A. The operator shall provide: [Eff. 05/01/2009]
i. A description of the oil and gas operation to be considered, including location; [Eff. 05/01/2009]
ii. Any other relevant available information on the oil and gas operation, the affected wildlife resource, or the provision(s) of the 1200-Series Rules upon which the consultation is based; and [Eff. 05/01/2009]
iii. Proposed mitigation for the affected wildlife resource. [Eff. 05/01/2009]
B. The Commission shall take into account the information submitted by the operator consistent with Rule 1202.c. [Eff. 05/01/2009]
C. The operator, the Commission, the surface owner, and the Colorado Division of Wildlife shall have forty (40) days to conduct the consultation called for in this section. Such consultation shall begin concurrent with the start of the public comment period. If no consultation occurs within such 40-day period, the requirement to consult shall be deemed waived, and the Director shall consider the operator’s application on the basis of the materials submitted by the operator. [Eff. 05/01/2009]
(3) Results of consultation under Rule 306.c. [Eff. 05/01/2009]
A. As a result of consultation called for in this subsection, the Colorado Division of Wildlife may make written recommendations to the Commission on conditions of approval necessary to minimize adverse impacts to wildlife resources. Where applicable, the Colorado Division of Wildlife may also make written recommendations on whether a variance request should be granted, under what conditions, and the reasons for any such recommendations. [Eff. 05/01/2009]
B. Agreed-upon conditions of approval. Where the operator, the Director, the Colorado Division of Wildlife, and the surface owner agree to conditions of approval for oil and gas locations as a result of consultation, these conditions of approval shall be incorporated into approvals of an Oil and Gas Location Assessment, Form 2A, or Application for Permit-to-Drill, Form 2, where applicable. [Eff. 05/01/2009]
C. Permit-specific conditions. Where the consultation called for in this subsection results in permit-specific conditions of approval to minimize adverse impacts to wildlife resources, the Director shall attach such permit-specific conditions only with the consent of the affected surface owner. [Eff. 05/01/2009]
D. Standards for consultation and initial decision. Following consultation and subject to subsection C above and Rule 1202.c, the Director shall decide whether to attach conditions of approval to a Form 2A or Form 2, where applicable. In making this decision, the Director shall apply the criteria of Rule 1202. [Eff. 05/01/2009]
E. Notification of decision to consulting agency. Where consultation occurs under Rule 306.c, the Director shall provide to the Colorado Division of Wildlife the conditions of approval for the Application for Permit-to-Drill, Form 2, or Oil and Gas Location Assessment, Form 2A, on the same day that he or she announces a decision to approve the application. [Eff. 05/01/2009]
d. Consultation with the Colorado Department of Public Health and Environment.
(1) Consultation to occur.
A. The Commission shall consult with the Colorado Department of Public Health and Environment on an Oil and Gas Location Assessment, Form 2A, where:
i. The local governmental designee requests, within fourteen (14) days of notice, the participation of the Colorado Department of Public Health and Environment in the Commission’s consideration of an Application for Permit-to-Drill, Form 2, or Oil and Gas Location Assessment, Form 2A, based on concerns regarding public health, safety, welfare, or impacts to the environment;
ii. The operator seeks from the Director a variance from, or consultation is otherwise required or permitted under, a provision of one of the following rules intended for the protection of public health, safety, welfare, or the environment:
aa. Rule 317B. Public Water System Protection;
bb. Rule 325. Underground Disposal of Water;
cc. Rule 603. Drilling and Well Servicing Operations and High Density Area Rules;
dd. Rule 608. Coalbed Methane Wells;
ee. Rule 805. Odors and Dust.
ff. 900-Series E&P Waste Management; or
gg. Rule 1002.f. Stormwater Management.
All requests for variances from these rules must be made at the time an operator submits a Form 2A.
B. The Commission shall consult with the Colorado Department of Public Health and Environment when an operator requests a modification of an existing Commission order to increase well density or otherwise proposes to increase well density to more than one (1) well per forty (40) acres, or the Commission develops a basin-wide order that can reasonably be anticipated to have impacts on public health, welfare, safety, or environmental concerns or protections.
C. Notwithstanding the foregoing, the requirement to consult with the Colorado Department of Public Health and Environment may be waived by the Colorado Department of Public Health and Environment at any time.
(2) Procedure for consultation.
A. Where required, the Commission and the Colorado Department of Public Health and Environment shall have forty (40) days to conduct the consultation called for in this section. Such consultation shall begin concurrent with the start of the public comment period. If no consultation occurs within such 40-day period, the requirement to consult shall be waived, and the Director shall consider the operator’s application on the basis of the materials submitted by the operator.
B. The consultation called for in this section shall focus on identifying potential impacts to public health, safety, welfare, or the environment from activities associated with the proposed oil and gas location, and development of conditions of approval or other measures to minimize adverse impacts.
C. Where consultation occurs pursuant to Rule 306.d.(1).A, it may include:
i. Review of the permit application;
ii. Discussions with the local governmental designee to better understand local government’s concerns;
iii. Discussions with the Commission, operator, surface owner, or those potentially affected; and
iv. Review of public comments.
D. Where consultation occurs pursuant to Rule 306.d.(1).A.ii, the Colorado Department of Public Health and Environment shall have the opportunity to:
i. Review the permit application, the request for variance, and the basis for the request; and
ii. Discuss the request with the operator, the surface owner, and the Commission.
E. Where consultation occurs pursuant to Rule 306.d.(1).B, the Colorado Department of Public Health and Environment shall have the opportunity to:
i. Review the well-density increase application or draft Commission order; and
ii. Discuss the request with the operator or proponent, the Commission, and the local governmental designee.
(3) Results of consultation under Rule 306.d.
A. As a result of consultation called for in this subsection, the Colorado Department of Public Health and Environment may make written recommendations to the Commission on conditions of approval necessary to protect public health, safety, and welfare or the environment. Such recommendations may include, but are not limited to, monitoring requirements or best management practices. Where applicable, the Colorado Department of Public Health and Environment may also make written recommendations on whether a variance request should be granted, under what conditions, and the reasons for any such recommendations.
B. Agreed-upon conditions of approval. Where the operator, the Director, the Colorado Department of Public Health and Environment, and the surface owner agree to conditions of approval for oil and gas locations as a result of consultation, these conditions of approval shall be incorporated into approvals of an Oil and Gas Location Assessment, Form 2A, or Applications for Permit-to-Drill, Form 2, where applicable.
C. Standards for consultation and Director decision. Following consultation, the Director shall decide whether to attach conditions of approval recommended by the Colorado Department of Public Health and Environment to a Form 2A or Form 2, where applicable. This decision shall minimize significant adverse impacts to public health, safety, and welfare, including the environment, consistent with other statutory obligations.
D. Notification of decision to consulting agency. Where consultation occurs under Rule 306.d, the Director shall provide to the Colorado Department of Public Health and Environment the conditions of approval for the Application for Permit-to-Drill, Form 2, or Oil and Gas Location Assessment, Form 2A, on the same day that he or she announces a decision to approve the application.
e. Final reclamation consultation . In preparing for final reclamation and plugging and abandonment, the operator shall use its best efforts to consult in good faith with the affected surface owner (or the tenant when the surface owner has requested that such consultation be made with the tenant). Such good faith consultation shall allow the surface owner (or appointed agent) the opportunity to provide comments concerning preference for timing of such operations and all aspects of final reclamation, including, but not limited to, the desired final land use and seed mix to be applied.
c. Tenants . Operators shall have no obligation to consult with tenant farmers, lessees, or any other party that may own or have an interest in any crops or surface improvements that could be affected by the proposed operation unless the surface owner appoints such person as its agent for such purposes. Nothing shall prevent the surface owner from including a tenant in any consultation, whether or not appointed as the surface owner’s agent.
307. COGCC Form 4. SUNDRY NOTICES AND REPORTS ON WELLS
The Sundry Notice, Form 4, is a multipurpose form which shall be used by an operator to request approval from or provide notice to the Director as required by rule or when no other specific form exists, i.e., well name or number change. The rules requiring the use of the Sundry Notice, Form 4, are listed in Appendix I.
308A. COGCC Form 5. DRILLING COMPLETION REPORT
Within thirty (30) days of the setting of production casing, the plugging of a dry hole, the deepening or sidetracking of a well, or any time the wellbore configuration is changed, the operator shall transmit to the Director the Drilling Completion Report, Form 5, and two (2) copies of all logs run, be they mechanical, mud, or other, submitted as one (1) paper copy and, as available, one (1) digital LAS (log ASCII) formatted copy, or a format approved by the Director. Additionally, if drill stem tests, core analyses, or directional surveys are run, they shall be submitted at the same time and together with this completion report. All Sections 1 - 22 (if applicable) and the attachment checklist shall be completely filled out. The latitude and longitude coordinates in decimal degrees to an accuracy and precision of five (5) decimals of a degree using the North American Datum (NAD) of 1983 (e.g.; latitude 37.12345 N, longitude 104.45632 W), Position Dilution of Precision (PDOP) reading, instrument operator’s name and the date of the measurement of the “as drilled” well location shall be reported on the Form 5. If GPS technology is utilized to determine the latitude and longitude, all GPS data shall meet the requirements set forth in Rule 215. a. through h.
Within thirty (30) days of the suspension of commenced drilling activities prior to reaching total depth, the operator shall file a Drilling Completion Report, Form 5, notifying the Director of the date of such suspension of drilling activity stating the reason for suspension and the anticipated date and method of resumption of drilling, showing the details of all work performed to date. In cases of an uncompleted well, the initial Drilling Completion Report, Form 5, shall state "preliminary" at the top of the form. A supplementary Form 5 shall be submitted within thirty (30) days of reaching total depth.
308B. COGCC Form 5A. COMPLETED INTERVAL REPORT
The Completed Interval Report, Form 5A, shall be submitted within thirty (30) days of completing a formation (successful or not), when a formation is temporarily abandoned or permanently abandoned, for a recompletion, reperforation or restimulation, or when a formation is commingled.
In order to resolve completed interval information uncertainties, the Director may require an operator to submit a Completed Interval Report, Form 5A.
308C. CONFIDENTIALITY
Upon submittal of a Sundry Notice, Form 4, request by the operator, completion reports, including Drilling Completion Reports, Form 5 and Completed Interval Reports, Form 5A, and mechanical logs of exploratory or wildcat wells shall be marked “confidential” by the Director and kept confidential for six (6) months after the date of completion, unless the operator gives written permission to release such logs at an earlier date.
309. COGCC Form 7. OPERATOR'S MONTHLY PRODUCTION REPORT
Each producer or operator of an oil or gas well shall file with the Commission, within forty-five (45) days after the month in which production occurs, a report on Operator's Monthly Production Report, Form 7, containing all information required by said form. In addition, all fluids produced during the initial testing and completion shall be reported on Operator's Monthly Production Report, Form 7 within forty-five (45) days after the month in which testing and completion occurs.
310. COGCC Form 8. MILL LEVY
On or before March 1, June 1, September 1 and December 1 of each year, every producer or purchaser, whichever disburses funds directly to each and every person owning a working interest, a royalty interest, an overriding royalty interest, a production payment and other similar interests from the sale of oil or natural gas subject to the charge imposed by §34-60-122(1) (a) C.R.S., 1973, as amended, shall file a return with the Director showing by operator, the volume of oil, gas or condensate produced or purchased during the preceding calendar quarter, including the total consideration due or received at the point of delivery. No filing shall be required when the charge imposed is zero mill ($0.0000) per dollar value.
The levy shall be an amount fixed by order of the Commission. The levy amount may, from time to time, be reduced or increased to meet the expenses chargeable against the oil and gas conservation and environmental response fund. The present charge imposed, as of July 1, 2007, is seven tenths of a mill ($0.0007) per dollar value.
311. COGCC Form 6. WELL ABANDONMENT REPORT
Notice shall be given to the Director, and approval obtained in advance of the time the operator expects to abandon a well on Form 6. When filing an intent to abandon, the form shall be completed and attachments included to fully describe the proposed operations. This includes the proposed depths of mechanical plugs and casing cuts, the proposed depths and volumes of all cement plugs, the amount, size and depth of casing and junk to be left in the well, the volume and weight of fluid to be left in the wellbore and the nature and quantities of any other materials to be used in the plugging. If the well is not plugged within six (6) months of intent approval a new intent shall be filed.
Within thirty (30) days after abandonment, the Well Abandonment Report, Form 6, shall be filed with the Director. The abandonment details shall include an account of the manner in which the abandonment or plugging work was performed. Additionally, plugging verification reports detailing all procedures are required. A Plugging Verification Report shall be submitted for each person or contractor actually setting the plugs. The Well Abandonment Report, Form 6, and the Plugging Verification Reports shall detail the depths of mechanical plugs and casing cuts, the depths and volumes of all cement plugs, the amount, size and depth of casing and junk left in the well, the volume and weight of fluid left in the wellbore and the nature and quantities of any other materials used in the plugging. Plugging Verification Reports shall conform with the operator's report and both shall show that plugging procedures are at least as extensive as those approved by the Director. When filing a subsequent report of abandonment, the entire form shall be completed except for the second block, background information. (See Rule 319 for well abandonment requirements and procedures.)
312. COGCC Form 10. CERTIFICATE OF CLEARANCE AND/OR CHANGE OF OPERATOR
a. Each operator of any oil or gas well completed after April 30, 1956, shall file with the Director, within thirty (30) days after initial sale of oil or gas a Certificate of Clearance and/or Change of Operator, Form 10, in accordance with the instructions appearing on such form, for each well producing oil or gas or both oil and gas. A Certificate of Clearance shall be filed for any well from which oil, gas or other hydrocarbon is being produced.
A Certificate of Clearance shall be filed within thirty (30) days should the oil transporter (first purchaser) and/or the gas gatherer (first purchaser) change. In addition, within fifteen (15) days of an operator change for any well, a Change of Operator, Form 10, shall be filed with a filing and service fee as set by the Commission. (See Appendix III)
b. Each operator of a Class II injection well shall file a new Form 10 with the Director within fifteen (15) days of the transfer of ownership.
c. Whenever there shall occur a change in the producer or operator filing the certificate under Rule 310.a hereof, or whenever there shall occur a change of transporter from any well within the State, a new Form 10 shall be executed and filed within fifteen (15) days in accordance with the instructions appearing on such form. In the case of temporary use of oil for well treating or stimulating purposes, no new form need be executed. In the case of other temporary change in transporter involving the production of less than one (1) month, the producer or operator may, in lieu of filing a new certificate, notify the Commission and the transporter authorized by the certificate on file with the Commission by letter of the estimated amount to be moved by the temporary transporter and the name of such temporary transporter. A copy of such notice shall also be furnished such temporary transporter.
d. In no instance shall the temporary transporter move any quantity greater than the estimated amount shown in said notice.
e. The certificate, when properly executed and approved by the Commission, shall constitute authorization to the pipeline or other transporter to transport the authorized volume from the well named therein; provided that this section shall not prevent the production or transportation in order to prevent waste, pending execution and approval of said certificate. Permission for the transportation of such production shall be granted in writing to the producer and transporter.
f. The certificate shall remain in force and effect until:
(1) The producer or operator filing the certificate is changed; or
(2) The transporter is changed; or
(3) The certificate is canceled by the Commission.
g. A copy of each Form 10 to be filed hereunder shall be sent by the Director to those local governmental designees who so request.
h. It is the operator's responsibility to mail approved copies of the Certificate of Clearance and/or Change of Operator, Form 10, to the transporter and/or gatherer for each well listed.
i. A completed Form 10 shall be required for any change of operator for all oil and gas facilities, excluding gathering systems, gas-processing plants, and gas storage facilities as those shall be changed with a Form 12, Gas Facility Registration/Change of Operator.
313. COGCC Form 11. MONTHLY REPORT OF GASOLINE OR OTHER EXTRACTION PLANTS
All operators of gasoline or other extraction plants shall make monthly reports to the Director on Form 11 Such forms shall contain all information required thereon and shall be filed with the Director on or before the twenty-fifth (25th) day of each month covering the preceding month.
314. COGCC Form 17. BRADENHEAD TEST REPORT
Results of bradenhead tests, as required by Rule 207.b., shall be submitted to the Director within ten (10) days of completion. A wellbore diagram shall be submitted if not previously submitted or if the wellbore configuration has changed. If sampled, then the results of any gas and liquid analysis shall be submitted.
315. REPORT OF RESERVOIR PRESSURE TEST
Where the Director believes it is necessary to prevent waste, protect correlative rights, or prevent a significant adverse impact, the Director may require subsurface pressure measurements. Whenever such measurements are made, results shall be reported on Sundry Notice, Form 4, within twenty (20) days after completion of tests, or submitted on any company form approved by the Director containing the same information.
316A. COGCC Form 14. MONTHLY REPORT OF FLUIDS INJECTED
Except for fluids involved with fracturing, acidizing or other similar treatment elsewhere required to be reported on a Completed Interval Report, Form 5A, all operators engaged in the injection of fluids into any formation in dedicated injection wells shall file monthly with the Commission a detailed account of such operation on Form 14, or any company form containing the same information previously approved by the Director. Types of chemicals used to treat injection water, as well as the date of initial fluid injection for new injection wells, are to be reported on said form under Remarks. The type and amount of fluids received from transporters shall be included on the report. Operators of simultaneous injection wells shall, by March 1 of each year, report to the Director the calculated injected volume for the previous year by month on Form 14. Operators of gas storage projects shall, by March 1 of each year, report to the Director the amount of gas injected and withdrawn for the previous year and the amount of gas remaining in the reservoir as of December 31 of that year.
316B. COGCC Form 21. MECHANICAL INTEGRITY TEST
Results of mechanical integrity tests of injection wells or shut-in wells shall be submitted on Form 21, within thirty (30) days after the test. A pressure chart shall accompany this report. Not less than ten (10) days prior to the performance of any mechanical integrity test the Director shall be notified, in writing, of the scheduled date on which the test will be performed. The form shall be completely filled out except for Part II, which is required only if the well is a permitted or pending injection well.
317. GENERAL DRILLING RULES
Unless altered, modified, or changed for a particular field or formation upon hearing before the Commission the following shall apply to the drilling or deepening of all wells.
a. Blowout prevention equipment (“BOPE” ). The operator shall take all necessary precautions for keeping a well under control while being drilled or deepened. BOPE, if any, shall be indicated on the Application for Permit to Drill, Deepen, Re-enter, or Recomplete and Operate (Form 2), as well as any known subsurface conditions (e.g. under or over-pressured formations). The working pressure of any BOPE shall exceed the anticipated surface pressure to which it may be subjected, assuming a partially evacuated hole with a pressure gradient of 0.22 psi/ft. [For BOPE requirements in high density areas see Rule 603.b.(4)B. For statewide BOPE specification, inspection, operation and testing requirements see Rule 603.f.]
(1) The Director shall have the authority to designate specific areas, fields or formations as requiring certain BOPE. Any such proposed designation shall occur by notice describing the area, field or formation in question and shall be given to all operators of record within such area or field and by publication. The proposed designation, if no protest is timely filed, shall be placed on the Commission consent agenda for its next regularly scheduled meeting following the month in which such notice was given. The matter shall be approved or heard by the Commission in accordance with Rule 520. Such designation shall be effective immediately upon approval by the Commission, except as to any previously-approved Form 2.
(2) The Director shall have the authority, outside areas designated pursuant to Rule 317.a.(1), to condition approval of any application for permit to drill by requiring BOPE which the Director determines to be necessary for keeping the well under control. Should the operator object to such condition of approval, the matter shall be heard at the next regularly scheduled meeting of the Commission, subject to the notice requirements of Rule 507.
b. Bottom hole location . Unless authorized by the provisions of Rule 321., all wells shall be so drilled that the horizontal distance between the bottom of the hole and the location at the top of the hole shall be at all times a practical minimum.
c. Requirement to post permit at the rig and provide spud notice . A copy of the approved Application for Permit to Drill, Deepen, Re-enter, or Recomplete and Operate, Form 2, shall be posted in a conspicuous place on the drilling rig or workover rig. A notice shall be provided to the Director on a Sundry Notice, Form 4, no later than five (5) days following the spudding of a well. The Director may apply a condition of approval for Application for Permit to Drill, Deepen, Re-enter, or Recomplete and Operate, Form 2 requiring not less than twenty-four (24) hours nor more than seventy-two (72) hours verbal or written notice prior to spud.
d. Casing program to protect hydrocarbon horizons and ground water . The casing program adopted for each well must be so planned and maintained as to protect any potential oil or gas bearing horizons penetrated during drilling from infiltration of injurious waters from other sources, and to prevent the migration of oil, gas or water from one (1) horizon to another, that may result in the degradation of ground water. A Sundry Notice, Form 4, including a detailed work plan and a wellbore diagram, shall be submitted and approved by the Director prior to any routine or planned casing repair operations. During well operations, prior verbal approval for unforeseen casing repairs followed by the filing of a Sundry Notice, Form 4, after completion of operations shall be acceptable.
e. Surface casing where subsurface conditions are unknown . In areas where pressure and formations are unknown, sufficient surface casing shall be run to reach a depth below all known or reasonably estimated utilizable domestic fresh water levels and to prevent blowouts or uncontrolled flows, and shall be of sufficient size to permit the use of an intermediate string or strings of casings. Surface casing shall be set in or through an impervious formation and shall be cemented by pump and plug or displacement or other approved method with sufficient cement to fill the annulus to the top of the hole, all in accordance with reasonable requirements of the Director. In the D–J Basin Fox Hills Protection Area surface casing will be set in accordance with Rule 317A. (See also subparagraph g.).
f. Surface casing where subsurface conditions are known . For wells drilled in areas where subsurface conditions have been established by drilling experience, surface casing, size at the owner's option, shall be set and cemented to the surface by the pump and plug or displacement or other approved method at a depth and in a manner sufficient to protect all fresh water and to ensure against blowouts or uncontrolled flows. In the D–J Basin Fox Hills Protection Area surface casing shall be set in accordance with Rule 317A. (See also subparagraph g.).
g. Alternate aquifer protection by stage cementing. In areas where fresh water aquifers are of such depth as to make it impractical or uneconomical to set the full amount of surface casing necessary to comply fully with the requirement to cover or isolate all fresh water aquifers as required in subparagraph e. and f., the owner may, at its option, comply with this requirement by stage cementing the intermediate and/or production string so as to accomplish the required result. If unanticipated fresh water aquifers are encountered after setting the surface pipe they shall be protected or isolated by stage cementing the intermediate and/or production string with a solid cement plug extending from fifty (50) feet below each fresh water aquifer to fifty (50) feet above said fresh water aquifer or by other methods approved by the Director in each case. In the D–J Basin Fox Hills Protection Area any stage cementing shall occur only in accordance with Rule 317A. If the stage cement is not circulated to surface, a temperature log or cement bond log shall be run to determine the top of the stage cement to ensure aquifers are protected.
h. Surface and intermediate casing cementing . The operator shall ensure that all surface and intermediate casing cement required under this rule shall be of adequate quality to achieve a minimum compressive strength of three hundred (300) psi after twenty-four (24) hours and eight hundred (800) psi after seventy-two (72) hours measured at ninety-five degrees fahrenheit (95 °F) and at eight hundred (800) psi. All surface casing shall be cemented with a continuous column from the bottom of the casing to the surface. After thorough circulation of the wellbore, cement shall be pumped behind the intermediate casing to at least two hundred (200) feet above the top of the shallowest known production horizon and as required in 317.g. Cement placed behind the surface and intermediate casing shall be allowed to set a minimum of eight (8) hours, or until three hundred (300) psi calculated compressive strength is developed, whichever occurs first, prior to commencing drilling operations. If the surface casing cement level falls below the surface, to the extent safety or aquifer protection is compromised, remedial cementing operations shall be performed.
i. Production casing cementing . The operator shall ensure that all cement required under this rule placed behind production casing shall be of adequate quality to achieve a minimum compressive strength of at least three hundred (300) psi after twenty-four (24) hours and eight hundred (800) psi after seventy-two (72) hours measured at ninety-five degrees fahrenheit (95 °F) and at eight hundred (800) psi. After thorough circulation of a wellbore, cement shall be pumped behind the production casing (200) feet above the top of the shallowest known producing horizon. All fresh water aquifers which are exposed below the surface casing shall be cemented behind the production casing. All such cementing around an aquifer shall consist of a continuous cement column extending from at least fifty (50) feet below the bottom of the fresh water aquifer which is being protected to at least fifty (50) feet above the top of said fresh water aquifer. Cement placed behind the production casing shall be allowed to set seventy-two (72) hours, or until eight hundred (800) psi calculated compressive strength is developed, whichever occurs first, prior to the undertaking of any completion operation.
j. Production casing pressure testing . The installed production casing shall be adequately pressure tested for the conditions anticipated to be encountered during completion and production operations.
k. Protection of aquifers and production stratum and suspension of drilling operations before running production casing . In the event drilling operations are suspended before production string is run, the Director shall be notified immediately and the operator shall take adequate and proper precautions to assure that no alien water enters oil or gas strata, nor potential fresh water aquifers during such suspension period or periods. If alien water is found to be entering the production stratum or to be causing significant adverse environmental impact to fresh water aquifers during completion testing or after the well has been put on production, the condition shall be promptly remedied.
l. Flaring of gas during drilling and notice to local emergency dispatch. Any gas escaping from the well during drilling operations shall be, so far as practicable, conducted to a safe distance from the well site and burned. The operator shall notify the local emergency dispatch as provided by the local governmental designee of any such flaring. Such notice shall be given prior to the flaring if the flaring can be reasonably anticipated, and in all other cases as soon as possible but in no event more than two (2) hours after the flaring occurs.
m. Protection of productive strata during deepening operations . If a well is deepened for the purpose of producing oil and gas from a lower stratum, such deepening to and completion in the lower stratum shall be conducted in such a manner as to protect all upper productive strata.
n. Requirement to evaluate disposal zones for hydrocarbon potential. If a well is drilled as a disposal well then the disposal zone shall be evaluated for hydrocarbon potential. The proposed hydrocarbon evaluation method shall be submitted in writing and approved by the Director prior to implementation. The productivity results shall be submitted to the Director upon completion of the well.
o. Requirement to log well. For all new drilling operations, the operator shall be required to run a minimum of a resistivity log with gamma-ray or other petrophysical log(s) approved by the Director that adequately describe the stratigraphy of the wellbore. A cement bond log shall be run on all production casing or, in the case of a production liner, the intermediate casing, when these casing strings are run. These logs and all other logs run shall be submitted with the Well Completion or Recompletion Report and Log, Form 5. Open hole logs shall be run at depths that adequately verify the setting depth of surface casing and any aquifer coverage. These requirements shall not apply to the unlogged open hole completion intervals, or to wells in which no open hole logs are run.
p. Remedial cementing during recompletion. The Director may apply a condition of approval for Application for Permit to Drill, Deepen, Re-enter, or Recomplete and Operate, Form 2, to require remedial cementing during recompletion operations consistent with the provisions for protecting aquifers and hydrocarbon bearing zones in this Rule 317.
317A. SPECIAL DRILLING RULES - D–J BASIN FOX HILLS PROTECTION AREA
The following special drilling rules shall apply to wells in the D–J Basin Fox Hills Protection Area as defined in the 100 Series of the Rules and Regulations:
a. Surface Casing - Minimum Requirements for Well Control. In all wells drilled within the D–J Basin Fox Hills Protection Area, surface casing shall be run to a minimum depth of five percent (5%) of the projected total depth to which the well is to be drilled, provided that in no event shall the surface casing be run to a depth less than two hundred (200) feet. The Director may, on a case-by-case basis, grant variances in this five percent (5%) requirement where the Director finds that the well is a development well in which pressures can be accurately predicted and finds that, based upon those predictions, the five percent (5%) requirement should be varied to achieve effective well control. In all cases, however, the actual depth at which the surface casing is set shall be calculated to position the casing seat to a depth within a competent formation (preferably shale) which will contain the maximum pressure to which the casing will be exposed during normal drilling operations.
b. Surface Casing - Aquifer Protection. For purposes of aquifer protection, surface casing must be set as follows in wells which are not exploratory wells:
(1) Surface casing shall be run to a depth at least fifty (50) feet below the Fox Hills transition zone in wells drilled within Townships 5 South through 5 North, Ranges 65 West through 70 West or within Townships 3 North through 5 North, Range 64 West.
(2) With respect to Townships 5 South through 5 North, Ranges 58 West through 63 West, Townships 5 South through 2 North, Range 64 West; and Township 6 South, Ranges 65 West through 70 West, in all wells located within one (1) mile of a permitted producing water well, surface casing shall be set to a depth sufficient to protect the deepest permitted producing water well within such one mile area. Said depth shall be at least fifty (50) feet below the depth of the base of the aquifer from which said deepest water well is producing, or fifty (50) feet below the base of the Fox Hills Transition Zone if such deepest water well produces from the Fox Hills Aquifer.
Upon the request of the operator, the Director (or the Commission upon appeal) may grant a variance to the requirements of this subparagraph b. upon a showing to the Director, or the Commission upon appeal, that the variance does not violate the basic intent of said requirements. For such variance purpose, the basic intent of said requirements is stated to be to provide reasonable aquifer protection for the water well(s) which are permitted by the State of Colorado Division of Water Resources and are currently producing in the area potentially affected by the oil or gas well to be drilled.
c. Exploratory Wells. For purposes of the D–J Basin Fox Hills Protection Area only, the term exploratory well means any well:
(1) Which targets the classically demonstrated zones with limited geographic extent such as channel, bar, valley fill and levee type sandstones that were deposited prior to the x-bentonite time stratigraphic event; or
(2) Which can be demonstrated to be separated from a known producing horizon by a dry hole; or
(3) Which can be demonstrated to be targeted to a horizon which is geologically separate from the producing horizon in an offsetting producing well, or
(4) Which the Director, or the Commission upon appeal, may define as an exploratory well by variance, it being the basic intent of this definition that the requirements of subparagraph b. not operate to discourage the drilling of high risk wells.
317B. PUBLIC WATER SYSTEM PROTECTION
a. Definitions. For purposes of this Rule 317B:
(1) Drilling, Completion, Production and Storage (“DCPS” ) Operations shall mean operations at (i) well sites for the drilling, completion, recompletion, workover, or stimulation of wells or chemical and production fluid storage, and (ii) any other oil and gas location at which production facilities are operated. DCPS Operations shall exclude roads, gathering lines, pipelines, and routine operations and maintenance.
(2) Existing Oil and Gas Location shall mean an oil and gas location, excluding roads, pipelines, and gathering lines, permitted or constructed prior to the later of May 1, 2009 for federal land or April 1, 2009 for all other land or the date that the oil and gas location becomes subject to Rule 317B by virtue of its proximity to a Classified Water Supply Segment.
(3) New Oil and Gas Location shall mean an oil and gas location, excluding roads, pipelines, and gathering lines, that is not an existing oil and gas location.
(4) New Surface Disturbance shall mean surface disturbance that expands the area of surface covered by an oil and gas location beyond that initially disturbed in the construction of the oil and gas location.
(5) Non-Exempt Linear Feature shall mean a road, gathering line, or pipeline that is not necessary to cross a stream or connect or access a well or a gathering line.
b. Applicability Determination.
(1) Rule 317B is applicable to DCPS Operations within Surface Water Supply Areas. The applicability of Rule 317B will be determined by reviewing the Public Water System Surface Water Supply Area Map, attached as part of Appendix VI, or by entering information into the Public Water System Surface Water Supply Area Applicability Determination Tool, also located on the Commission website.
(2) The Public Water Systems subject to the protections of this Rule 317B are those listed in Appendix VI. Any additions or deletions to the Public Water Systems listed in Appendix VI or the Public Water System Surface Water Supply Area Map, also located in Appendix VI, shall be by Commission rulemaking, as provided in Rule 529.
(3) DCPS Operations at New Oil and Gas Locations within a Surface Water Supply Area will be subject to the requirements in Rules 317B.c, 317B.d, or 317B.e based on the buffer zones defined in Table 1, below. DCPS Operations at Existing Oil and Gas Locations within a Surface Water Supply Area at which no new surface disturbance has occurred after the date Rule 317B became applicable to that oil and gas location will be subject to the requirements in Rule 317B.f.(1) based on the buffer zones defined in Table 1. DCPS Operations at Existing Oil and Gas Locations within a Surface Water Supply Area at which new surface disturbance has occurred after the date Rule 317B became applicable to that oil and gas location will be subject to the requirements in Rule 317B.f.(2) based on the buffer zones defined in Table 1.
(4) For Classified Water Supply Segments that are perennial and intermittent streams, buffer zones shall be determined by measuring from the ordinary high water line of each bank to the near edge of the disturbed area at the oil and gas location at which the DCPS Operations will occur.
(5) The buffer zones shall apply only to DCPS Operations located on the surface. The buffer zones shall not apply to subsurface boreholes and equipment or materials contained therein. The buffer zones shall not apply to DCPS Operations located in an area that does not drain to a classified water supply segment protected by this Rule 317B.
TABLE 1. Buffer Zones Associated with DCPS Operations.
Zone
Classified Water Supply Segments (ft)
Internal Buffer
0 - 300
Intermediate Buffer
301 - 500
External Buffer
501 - 2,640
c. Requirements for DCPS Operations Conducted at New Oil and Gas Locations in the Internal Buffer Zone.
DCPS Operations conducted and Non-Exempt Linear Features located at New Oil and Gas Locations within a Surface Water Supply Area may not occur in whole or in part within the Internal Buffer Zone identified in Table 1 unless a variance is granted pursuant to Rule 502.b and consultation with the Colorado Department of Public Health and Environment occurs pursuant to Rule 306.d and a Form 2A or Form 2 with appropriate conditions of approval has been approved, or the Director has approved a Comprehensive Drilling Plan pursuant to Rule 216 that covers the operation. In determining appropriate conditions of approval for such operations, the Director shall consider the extent to which the conditions of approval are required to prevent impacts to the Public Water System.
(1) The Commission shall grant a variance if the operator demonstrates that:
A. The proposed DCPS Operations and applicable best management practices and operating procedures will result in substantially equivalent protection of drinking water quality in the Surface Water Supply area; and
B. Either:
i. Conducting the DCPS Operation outside the Internal Buffer Zone would pose a greater risk to public health, safety, or welfare, including the environment and wildlife resources, such as may be the case where conducting the DCPS Operations outside the Internal Buffer Zone would require construction in steep or erosion-prone terrain or result in greater surface disturbance due to an inability to use infrastructure already constructed such as roads, well sites, or pipelines; or
ii. Conducting DCPS Operations beyond the Internal Buffer Zone is technically infeasible and prevents the operator from exercising its mineral rights.
(2) At a minimum, for any DCPS Operation at a New Oil and Gas Location within the Internal Buffer Zone, the Director shall include as conditions of approval in the Form 2A, Form 2, or Comprehensive Drilling Plan, the requirements of Rule 317B.d.
d. Requirements for DCPS Operations at New Oil and Gas Locations in the Intermediate Buffer Zone.
The following shall be required for all DCPS Operations at New Oil and Gas Locations within a Surface Water Supply Area and in the Intermediate Buffer Zone as defined in Table 1.
(1) Pitless drilling systems;
(2) Flowback and stimulation fluids contained within tanks that are placed on a well pad or in an area with downgradient perimeter berming;
(3) Berms or other containment devices shall be constructed in compliance with Rule 603.e.(12) around crude oil, condensate, and produced water storage tanks; and
(4) When sufficient water exists in the Classified Water Supply Segment, collection of baseline surface water data consisting of a pre-drilling surface water sample collected immediately downgradient of the oil and gas location and follow-up surface water data consisting of a sample collected at the same location three (3) months after the conclusion of any drilling activities and operations or completion. The sample parameters shall include:
A. pH;
B. Alkalinity;
C. Specific conductance;
D. Major cations/anions (chloride, fluoride, sulfate, sodium);
E. Total dissolved solids;
F. BTEX/GRO/DRO;
G. TPH;
H. PAH’s (including benzo(a)pyrene); and
I. Metals (arsenic, barium, calcium, chromium, iron, magnesium, selenium).
Current applicable EPA-approved analytical methods for drinking water must be used and analyses must be performed by laboratories that maintain state or nationally accredited programs.
Copies of all test results described above shall be provided to the Commission and the potentially impacted Public Water System(s) within three (3) months of collecting the samples. In addition, the analytical results and surveyed sample locations shall be submitted to the Commission in an electronic data deliverable format.
(5) Notification of potentially impacted Public Water Systems within fifteen (15) stream miles downstream of the DCPS Operation prior to commencement of new surface disturbing activities at the site.
(6) An emergency spill response program that includes employee training, safety, and maintenance provisions and current contact information for downstream Public Water System(s) located within fifteen (15) stream miles of the DCPS Operation, as well as the ability to notify any such downstream Public Water System(s) with intake(s) within fifteen (15) stream miles downstream of the DCPS operations.
In the event of a spill or release, the operator shall immediately implement the emergency response procedures in the above-described emergency response program.
If a spill or release impacts or threatens to impact a Public Water System, the operator shall notify the affected or potentially affected Public Water System(s) immediately following discovery of the release, and the spill or release shall be reported to the Commission in accordance with Rule 906.b.(3), and to the Environmental Release/Incident Report Hotline (1-877-518-5608) in accordance with Rule 906.b.(4).
e. Requirements for DCPS Operations at New Oil and Gas Locations within the External Buffer Zone.
The following shall be required when DCPS Operations are conducted at New Oil and Gas Locations within a Surface Water Supply Area and in the External Buffer Zone as defined in Table 1.
(1) Pitless drilling systems or containment of all drilling flowback and stimulation fluids pursuant to Rule 904; and
(2) When sufficient water exists in the Classified Water Supply Segment, collection of baseline surface water data consisting of a pre-drilling surface water sample collected immediately downgradient of the oil and gas location and follow-up surface water data consisting of a sample collected at the same location three (3) months after the conclusion of any drilling activities and operations or completion. The sample parameters shall include:
A. pH;
B. Alkalinity;
C. Specific conductance;
D. Major cations/anions (chloride, fluoride, sulfate, sodium);
E. Total dissolved solids;
F. BTEX/GRO/DRO;
G. TPH;
H. PAH’s (including benzo(a)pyrene); and
I. Metals (arsenic, barium, calcium, chromium, iron, magnesium, selenium).
Current applicable EPA-approved analytical methods for drinking water must be used and analyses must be performed by laboratories that maintain state or nationally accredited programs.
Copies of all test results described above shall be provided to the Commission and the potentially impacted Public Water System(s) within three (3) months of collecting the samples. In addition, the analytical results and surveyed sample locations shall be submitted to the Commission in an electronic data deliverable format.
(3) Notification of potentially impacted Public Water Systems within fifteen (15) stream miles downstream of the DCPS Operation prior to commencement of new surface disturbing activities at the site.
(4) An emergency spill response program that includes employee training, safety, and maintenance provisions and current contact information for downstream Public Water System(s) located within fifteen (15) stream miles of the DCPS Operation, as well as the ability to notify any such downstream Public Water System(s) with intake(s) within fifteen (15) stream miles downstream of the DCPS operations.
In the event of a spill or release, the operator shall immediately implement the emergency response procedures in the above-described emergency response program.
If a spill or release impacts or threatens to impact a Public Water System, the operator shall notify the affected or potentially affected Public Water System(s) immediately following discovery of the release, and the spill or release shall be reported to the Commission in accordance with Rule 906.b.(3), and to the Environmental Release/Incident Report Hotline (1-877-518-5608) in accordance with Rule 906.b.(4).
f. Requirements for DCPS Operations at Existing Oil and Gas Locations.
(1) Existing Oil and Gas Locations and DCPS Operations at Existing Oil and Gas Locations within a Surface Water Supply Area and within zones specified in Table 1 shall be subject to the following requirements instead of the requirements of Rules 317B.c, 317B.d, or 317B.e provided that no new surface disturbance at the Existing Oil and Gas Location occurs after the later of May 1, 2009 for federal land or April 1, 2009 for all other land or the date Rule 317B became applicable to the oil and gas location:
A. Collection of surface water data from a Classified Water Supply Segment consisting of a sample collected immediately downgradient of the oil and gas operation will occur by the latest of June 1, 2009, within six (6) months after the date Rule 317B became applicable to the oil and gas location, or when sufficient water exists in the stream:
i. pH;
ii. Alkalinity;
iii. Specific conductance;
iv. Major cations/anions (chloride, fluoride, sulfate, sodium);
v. Total dissolved solids;
vi. BTEX/GRO/DRO;
vii. TPH;
viii. PAH’s (including benzo(a)pyrene); and
ix. Metals (arsenic, barium, calcium, chromium, iron, magnesium, selenium).
Current applicable EPA-approved analytical methods for drinking water must be used and analyses must be performed by laboratories that maintain state or nationally accredited programs.
Copies of all test results described above shall be provided to the Commission and the potentially impacted Public Water System(s) within three (3) months of collecting the samples. In addition, the analytical results and surveyed sample locations shall be submitted to the Commission in an electronic data deliverable format.
B. An emergency spill response program that includes employee training, safety, and maintenance provisions and current contact information for downstream Public Water System(s) located within fifteen (15) stream miles of the DCPS Operation, as well as the ability to notify any such downstream Public Water System(s) with intake(s) within fifteen (15) stream miles downstream of the DCPS Operations.
In the event of a spill or release, the operator shall immediately implement the emergency response procedures in the above-described emergency response program.
If a spill or release impacts or threatens to impact a Public Water System, the operator shall notify the affected or potentially affected Public Water System(s) immediately following discovery of the release, and the spill or release shall be reported to the Commission in accordance with Rule 906.b.(3), and to the Environmental Release/Incident Report Hotline (1-877-518-5608) in accordance with Rule 906.b.(4).
C. Operators shall employ and maintain Best Management Practices, as necessary, to comply with this rule.
(2) Existing Oil and Gas Locations and DCPS Operations at Existing Oil and Gas Locations within a Surface Water Supply Area and within zones specified in Table 1 for which new surface disturbance occurs on or after the later of May 1, 2009 for federal land or on or after April 1, 2009 for all other land or the date Rule 317B became applicable to the oil and gas location shall be subject to the requirements of Rule 317B.f.(3) instead of the requirements of Rules 317B.c, 317B.d, or 317B.e where the additional new surface disturbance is addressed in a Comprehensive Drilling Plan accepted pursuant to Rule 216, or if:
A. The new disturbance from the DCPS Operation will not increase the existing disturbed area prior to interim reclamation by more than one hundred (100) percent up to a maximum of three (3) acres, and
B. The new surface disturbance occurs in a direction away from the stream or no closer to the stream if moving away from the stream would result in more damaging surface disturbance such as location on a steep slope, in an area of high soil erosion potential, or in a wetland.
(3) Where the provisions of Rule 317B.f.(2) apply, the following zone requirements shall apply:
A. For all zones, the requirements of Rule 317B.f.(1), except that the sampling parameters in Rule 317B.f.(1).A shall occur no later than six (6) months after commencing the DCPS Operations at the Existing Oil and Gas Location.
B. For External and Intermediate Buffer Zones: pitless drilling systems or containment of drilling, flowback, and stimulation fluids with impervious liners, as provided in Rule 904.
C. For Internal Buffer Zones:
i. Pitless drilling systems;
ii. Flowback and stimulation fluids contained within tanks and placed on a well pad or in an area with downgradient perimeter berming;
iii. Berms constructed in compliance with Rule 603.e.(12) around all crude oil, condensate, and produced water tanks; and
iv. Notification of potentially impacted Public Water Systems within fifteen (15) stream miles downstream of the DCPS Operation prior to commencement of new surface disturbing activities at the site.
318. LOCATION OF WELLS
All wells drilled for oil or gas to a common source of supply shall have the following setbacks:
a. Wells 2,500 feet or greater in depth. A well to be drilled two thousand five hundred (2,500) feet or greater shall be located not less than six hundred (600) feet from any lease line, and shall be located not less than one thousand two hundred (1,200) feet from any other producible or drilling oil or gas well when drilling to the same common source of supply, unless authorized by order of the Commission upon hearing.
b. Wells less than 2,500 feet in depth. A well to be drilled to less than a depth of two thousand five hundred (2,500) feet below the surface shall be located not less than two hundred (200) feet from any lease line, and not less than three hundred (300) feet from any other producible oil or gas well, or drilling well, in said source of supply, except that only one producible oil or gas well in each such source of supply shall be allowed in each governmental quarter-quarter section unless an exception under Rule 318.c. is obtained.
c. Exception locations . The Director may grant an operator's request for a well location exception to the requirements of this rule or any order because of geologic, environmental, topographic or archaeological conditions, irregular sections, a surface owner request, or for other good cause shown provided that a waiver or consent signed by the lease owner toward whom the well location is proposed to be moved, agreeing that said well may be located at the point at which the operator proposes to drill the well and where correlative rights are protected. If the operator of the proposed well is also the operator of the drilling unit or unspaced offset lease toward which the well is proposed to be moved, waivers shall be obtained from the mineral interest owners under such lands. If waivers cannot be obtained from all parties and no party objects to the location, the operator may apply for a variance under Rule 502.b. If a party or parties object to a location and cannot reach an agreement, the operator may apply for a Commission hearing on the exception location.
d. Exemptions to Rule 318.
(1) This rule shall not apply to authorized secondary recovery projects.
(2) This rule shall apply to fracture or crevice production found in shale, except from fields previously exempted from this rule.
(3) In a unit operation, approved by federal or state authorities, the rules herein set forth shall not apply except that no well in excess of two thousand five hundred (2,500) feet in depth shall be located less than so hundred (600) feet from the exterior or interior (if there be one) boundary of the unit area and no well less than two thousand five hundred (2,500) feet in depth below the surface shall be located less than two hundred (200) feet from the exterior or interior (if there be one) boundary of the unit area unless otherwise authorized by the order of the Commission after proper notice to owners outside the unit area.
e. Wells located near a mine. No well drilled for oil or gas shall be located within two hundred (200) feet of a shaft or entrance to a coal mine not definitely abandoned or sealed, nor shall such well be located within one hundred (100) feet of any mine shaft house, mine boiler house, mine engine house, or mine fan; and the location of any proposed well shall insure that when drilled it will be at least fifteen (15) feet from any mine haulage or airway.
318A. GREATER WATTENBERG AREA SPECIAL WELL LOCATION, SPACING AND UNIT DESIGNATION RULE
a. GWA, GWA wells, GWA windows and unit designations. The Greater Wattenberg Area ("GWA") is defined to include those lands from and including Townships 2 South to 7 North and Ranges 61 West to 69 West, 6th P.M. In the GWA, operators may utilize the following described surface drilling locations (“GWA windows” ) to drill, twin, deepen, or recomplete a well ("GWA well") and to commingle any or all of the Cretaceous Age formations from the base of the Dakota Formation to the surface:
(1) A square with sides four hundred (400) feet in length, the center of which is the center of any governmental quarter-quarter section (“400' window” ); and,
(2) A square with sides eight hundred (800) feet in length, the center of which is the center of any governmental quarter section (“800' window” ).
(3) Absent a showing of good cause, which shall include the existence of a surface use or other agreement with the surface owner authorizing a surface well location outside of a GWA window, all surface wellsites shall be located within a GWA window.
(4) Unit designations.
A. 400' window. When completing a GWA well in a 400' window to a spaced formation, the operator shall designate drilling and spacing units in accordance with existing spacing orders.
B. 800' window. When completing a GWA well in an 800' window, whether in spaced or unspaced formations, the operator shall: (i) designate drilling and spacing units in accordance with existing spacing orders where units are not smaller than a governmental quarter section; or (ii) form a voluntary drilling and spacing unit consisting of a governmental quarter section; or (iii) where designating a drilling and spacing unit smaller than a governmental quarter section, secure waiver(s) from the operator or from the mineral owners (if the operator is also the holder of the mineral lease) of the lands in the governmental quarter section that are not to be included in the spacing unit; or (iv) apply to the Commission to form an alternate unit or to respace the area.
C. Unspaced areas and wellbore spacing units. When completing a GWA well to an unspaced formation, the operator shall designate a drilling and spacing unit not smaller than a governmental quarter-quarter section if such well is proposed to be located greater than four hundred sixty (460) feet from the quarter-quarter section boundary in which it is located. If a well is proposed to be located less than four hundred sixty (460) feet from the governmental quarter-quarter section boundary, a wellbore spacing unit (“wellbore spacing unit” ) for such well shall be comprised of the four (4) governmental quarter-quarter sections nearest to the wellbore regardless of section or quarter section lines.
b. Recompletion/commingling of existing wells. Any GWA well in existence prior to the effective date of this rule, which is not located as described above, may also be utilized for deepening to or recompletion in any Cretaceous Age formation and for the commingling of production therefrom.
c. Surface locations. Prior to the approval of any Application for Permit-to-Drill submitted for a GWA well, the proposed surface well location shall be reviewed in accordance with the following criteria:
(1) A new surface well location shall be approved in accordance with Commission rules when it is less than fifty (50) feet from an existing surface well location.
(2) When the operator is requesting a surface well location greater than fifty (50) feet from a well (unless safety or mechanical considerations of the well to be twinned or topographical or surface constraints justify a location greater than fifty (50) feet), the operator shall provide a consent to the exception signed by the surface owner on which the well is proposed to be located in order for the Director to approve the well location administratively.
(3) If there is no well located within a GWA window but there is an approved exception location well located outside of a GWA window that is attributed to such window, the provisions of subsections (1) and (2) of this subsection c. shall be applicable to such location.
d. Prior wells excepted. This rule does not alter the size or configuration of drilling units for GWA wells in existence prior to the effective date of this rule. Where deemed necessary by an operator for purposes of allocating production, such operator may allocate production to any drilling and spacing unit with respect to a particular Cretaceous Age formation consistent with the provisions of this rule.
e. GWA infill. This subsection applies to the following area of the GWA: Township 1 North, Ranges 66 West through 68 West; Township 1 North, Range 69 West: E½; Township 2 North, Ranges 64 West through 68 West; Township 2 North, Range 69 West: E½; Township 3 North, Ranges 64 West through 67 West; Township 4 North, Ranges 63 through 67 West; Township 5 North, Ranges 63 West through 67 West; Township 6 North, Ranges 63 West through 66 West, 6th P.M.
(1) Interior infill wells. Additional bottom hole locations for the “J” Sand, Codell and Niobrara Formations are hereby established greater than four hundred sixty (460) feet from the outer boundary of any existing 320-acre drilling and spacing unit (“interior infill wells” ). Pursuant to the well location provisions of subsection a., above, interior infill well locations shall be reached by utilizing directional drilling techniques from the GWA windows.
A. If a bottom hole location for an interior infill well is proposed to be located less than four hundred sixty (460) feet from the outer boundary of an existing drilling and spacing unit, a wellbore spacing unit as defined in a.(4)C., above, shall be designated by the operator for such well.
B. If a bottom hole location for an interior infill well is proposed to be located greater than four hundred sixty (460) feet from an existing 80-acre or existing 320-acre drilling and spacing unit, the spacing unit for such well shall conform to the existing 80-acre or existing 320-acre drilling and spacing unit.
(2) Boundary wells. Additional bottom hole locations for the “J” Sand, Codell and Niobrara Formations are hereby established less than four hundred sixty (460) feet from the outer boundary of a 320-acre governmental half section or from the outer boundary of any existing 320-acre drilling and spacing unit (“boundary wells” ). A wellbore spacing unit as defined in a.(4)C., above, shall be designated by the operator for such well.
(3) Additional producing formations. An operator wanting to complete an interior infill well or boundary well in a formation other than the “J” Sand, Codell, or Niobrara Formations (“additional producing formation” ) must request an exception location prior to completing the additional producing formation. The spacing unit dedicated to the exception location shall comply with subsections (1) or (2), above, as appropriate.
(4) Water well sampling. The Director shall require initial baseline testing prior to the first interior infill well or boundary well (“proposed GWA infill well” ) drilled within a governmental section. The following shall be used as guidance for the Director in establishing initial baseline testing:
A. Within the governmental quarter section of the proposed GWA infill well, the closest water well (“water quality testing well” ) completed in the Laramie/Fox Hills Aquifer shall be sampled.
B. If no Laramie/Fox Hills water wells are located within the governmental quarter section, then the deepest representative water quality testing well within the governmental quarter section of the proposed GWA infill well shall be sampled.
C. If no water wells are located within the governmental quarter section, a water quality testing well (preferably completed in the Laramie/Fox Hills Aquifer) within one-half (½) mile of the proposed GWA infill well shall be selected.
D. If there are no water quality testing wells that meet the foregoing criteria, then initial baseline testing shall not be required.
E. Initial baseline testing shall include laboratory analysis of all major cations and anions, total dissolved solids, iron and manganese, nutrients (nitrates, nitrites, selenium), dissolved methane, pH, and specific conductance.
F. If free gas or a methane concentration level greater than 2 mg/l is detected in a water quality testing well, compositional analysis shall be performed to determine gas type (thermogenic, biogenic or an intermediate mix of both). If the testing results reveal biogenic gas, no further isotopic testing shall be required. If the testing results reveal thermogenic gas, carbon isotopic analyses of methane carbon shall be conducted. The Director may require further water well sampling at any time as a result of the laboratory results or in response to complaints from water well owners.
G. Copies of all test results described above shall be provided to the Director and the landowner where the water quality testing well is located within three (3) months of collecting the samples used for the test. Laboratory results shall also be submitted to the Director in an electronic format.
(5) Existing production facilities. To the extent reasonably practicable, operators shall utilize existing roads, pipelines, tank batteries and related surface facilities for all interior infill wells and boundary wells.
(6) Notice and hearing procedures. For proposed boundary wells, wellbore spacing units, and additional producing formations provided by this subsection e., the following process shall apply:
A. Notice shall be given by certified mail by the operator of a proposed boundary well or wellbore spacing unit to all owners in the proposed wellbore spacing unit. Notice shall be given by certified mail by the operator of a proposed additional producing formation to all owners in cornering and contiguous spacing units of the requested completion and the proposed spacing unit; if the additional producing formation is unspaced only the owner in the proposed spacing unit needs to be notified.
B. Each owner shall have a twenty (20) day period after receipt of such notice to object in writing to the operator to such well location, proposed spacing unit, or additional producing formation. If a timely objection is received, the matter shall be set on the docket at the next available Commission hearing. Absent receipt of an objection by the operator from an owner within such twenty (20) day period, the Director may administratively approve the boundary well, wellbore spacing unit, or additional producing formation, provided that it does not exceed eight (8) producing completions in the “J” Sand, Codell or Niobrara Formations in the 160-acre governmental quarter section as set forth in subsection f. below. A location plat evidencing the well location, wellbore spacing unit, or additional producing formation and applicable spacing unit shall be submitted to the Director together with copies of any surface waivers and a certification that no timely objections were received. An Application for Permit-to-Drill, Form 2, specifically identifying that a boundary well, a wellbore spacing unit, or an additional producing formation is proposed, shall also be filed with the Director in accordance with Rule 303.
(7) The Commission shall review the effectiveness of this subsection e. no later than March 1, 2008 and may require operators to submit data related to infill drilling performed under this subsection.
f. Limit on locations. This rule does not limit the number of formations that may be completed in any GWA drilling and spacing unit nor, subject to subsection c., above, does it limit the number of wells that may be located within the GWA windows. However, absent Commission order otherwise, there shall be no more than eight (8) producing completions in the “J” Sand, Codell or Niobrara Formations in any 160-acre governmental quarter section.
g. GWA water sampling. The Director may apply appropriate drilling permit conditions to require water well sampling near any proposed GWA wells in accordance with the guidelines set forth in subsection e.(4), above.
h. Exception locations. The provisions of Rule 318.c. respecting exception locations shall be applicable to GWA wells, however, absent timely objection, boundary wells, wellbore spacing units, and additional producing formations shall be administratively approved as provided in subsection e.(6) above.
i. Correlative rights. This rule shall not serve to bar the granting of relief to owners who file an application alleging abuse of their correlative rights to the extent that such owners can demonstrate that their opportunity to produce Cretaceous Age formations from the drilling locations herein authorized does not provide an equal opportunity to obtain their just and equitable share of oil and gas from such formations.
j. Supersedes orders and policy. Subject to paragraph d. above, this rule supersedes all prior Commission drilling and spacing orders affecting well location and density requirements of GWA wells and supersedes and replaces the “Policy on Staff Administrative Application of the Greater Wattenberg Area Well Location Rule 318A.,” dated April 26, 1999.
k. The landowner notice provision for the owner(s) of surface property within five hundred (500) feet of the proposed oil and gas location under Rule 305.e shall not apply to any such locations that are subject to the provisions of this subsection 318A.
318B. Yuma/Phillips County Special Well Location Rule
a. This Special Well Location Rule (“WLR” ) governs wells drilled to and completed in the Niobrara Formation for the following lands:
Township 1 North
Range 44 West: Sections 7, 18, 19, 30 through 33
Range 45 West: Sections 7 through 36
Range 46 West: Sections 4 through 9
Range 47 West: All
Range 48 West: All
Township 2 North
Range 46 West: All
Range 47 West: All
Range 48 West: All
Township 3 North
Range 45 West: Sections 1 through 18
Range 46 West: All
Range 47 West: All
Range 48 West: All
Township 4 North
Range 45 West: All
Range 46 West: All
Range 47 West: All
Range 48 West: All
Township 5 North
Range 45 West: All
Range 46 West: All
Range 47 West: All
Range 48 West: All
Township 6 North
Range 45 West: All
Range 46 West: All
Range 47 West: All
Range 48 West: All
Township 7 North
Range 45 West: All
Range 46 West: All
Range 47 West: All
Township 8 North
Range 45 West: All
Range 46 West: All
Range 47 West: All
Township 9 North
Range 45 West: Sections 19 through 36
Range 46 West: Sections 19 through 36
Range 47 West: Sections 19 through 36
Township 1 South
Range 44 West: Sections 3 through 10, 16 through 21, 27 through 34
Range 45 West: Sections 3 through 5
Range 46 West: Sections 4 through 9, 16 through 36
Range 47 West: All
Range 48 West: All
Township 2 South
Range 44 West: Sections 3 through 6
Range 45 West: Section 7: W½, Section 18: W½, Section 19: All
Range 46 West: Sections 1 through 24
Range 47 West: All
Range 48 West: All
Township 3 South
Range 48 West: All
Township 4 South
Range 48 West: All
Within the WLR Area, operators may conduct drilling operations to the Niobrara Formation as follows:
(1) Four (4) Niobrara Formation wells may be drilled in any quarter section.
(2) No more than one (1) well may be located in any quarter quarter section.
(3) No minimum distance shall be required between wells producing from the Niobrara Formation in any quarter section.
(4) Wells shall be located at least three hundred (300) feet from the boundary of said quarter section, and wells located outside any drilling units already established by the Commission in the WLR Area prior to this WLR’s effective date (July 30, 2006) shall, in addition, be located at least three hundred (300) feet from any lease line. Further, wells shall be located not less than nine hundred (900) feet from any producible well drilled to the Niobrara Formation prior to this WLR’s effective date (July 30, 2006) located in a contiguous or cornering quarter section unless exception is approved by the Director.
b. Any well drilled to the Niobrara Formation in the WLR Area prior to the effective date (July 30, 2006) of this WLR which is legally located when this WLR becomes effective but is not located as listed above shall be treated as properly located for purposes of this WLR.
c. This WLR does not alter the size or configuration of any drilling units already established by the Commission in the WLR Area prior to this WLR’s effective date (July 30, 2006).
d. This WLR shall not serve to bar the granting of relief to owners who file an application alleging abuse of their correlative rights to the extent that such owners can demonstrate that their opportunity to produce from the Niobrara Formation at locations herein authorized does not provide an equal opportunity to obtain their just and equitable share of oil and gas from such formation.
e. Well exception locations to this WLR shall be subject to the provisions of Rule 318.c.
f. This WLR is a well location rule and supersedes existing Commission orders in effect at the time of its adoption only to the extent that the existing orders relate to permissible well locations and the number of wells that may be drilled in a quarter section. Commission orders in effect when this Rule 318B. is adopted nonetheless apply with respect to the size of drilling units already established by the Commission in the WLR Area. This WLR is not intended to establish well spacing. Accordingly, when an area subject to Rule 318B. is otherwise unspaced, it does not act to space the area but instead provides the permissible locations for any new Niobrara Formation wells. Similarly, Rule 318B. does not affect production allocation for existing or future wells. An operator may allocate production in accordance with the applicable lease, contract terms or established drilling and spacing units recognizing the owner’s right to apply to the COGCC to resolve any outstanding correlative rights issues.
g. The landowner notice provisions for owner(s) of surface property within five hundred (500) feet of the proposed oil and gas location under Rule 305.e shall not apply to any such locations that are subject to the provisions of this Rule 318B.
319. ABANDONMENT
The requirements for abandoning a well shall be as follows:
a. Plugging
(1) A dry or abandoned well, seismic, core, or other exploratory hole, must be plugged in such a manner that oil, gas, water, or other substance shall be confined to the reservoir in which it originally occurred. Any cement plug shall be a minimum of fifty (50) feet in length and shall extend a minimum of fifty (50) feet above each zone to be protected. The material used in plugging, whether cement, mechanical plug, or some other equivalent method approved in writing by the Director, must be placed in the well in a manner to permanently prevent migration of oil, gas, water, or other substance from the formation or horizon in which it originally occurred. The preferred plugging cement slurry is that recommended by the American Petroleum Institute (API) Environmental Guidance Document: Well Abandonment and Inactive Well Practices for U.S. Exploration and Production Operations, i.e., a neat cement slurry mixed to API standards. However, pozzolan, gel and other approved extenders may be used if the operator can document to the Director's satisfaction that the slurry design will achieve a minimum compressive strength of three hundred (300) psi after twenty-four (24) hours and eight hundred (800) psi after seventy-two (72) hours measured at ninety-five degrees fahrenheit (95 °F) and at eight hundred (800) psi.
(2) The operator shall have the option as to the method of placing cement in the hole by (a) dump bailer, (b) pumping a balanced cement plug through tubing or drill pipe, (c) pump and plug, or (d) equivalent method approved by the Director prior to plugging. Unless prior approval is given, all wellbores shall have water, mud or other approved fluid between all plugs.
(3) No substance of any nature or description other than normally used in plugging operations shall be placed in any well at any time during plugging operations. All final reports of plugging and abandonment shall be submitted on a Well Abandonment Report, Form 6, and accompanied by a job log or cement verification report from the plugging contractor specifying the type of fluid used to fill the wellbore, type and slurry volume of API Class cement used, date of work, and depth the plugs were placed.
(4) In order to protect the fresh water strata, no surface casing shall be pulled from any well unless authorized by the Director.
(5) All abandoned wells shall have a plug or seal placed at the surface of the ground or the bottom of the cellar in the hole in such manner as not to interfere with soil cultivation or other surface use. The top of the pipe must be sealed with either a cement plug and a screw cap, or cement plug and a steel plate welded in place or by other approved method, or in the alternative be marked with a permanent monument which shall consist of a piece of pipe not less than four (4) inches in diameter and not less than ten (10) feet in length, of which four (4) feet shall be above the general ground level, the remainder to be embedded in cement or to be welded to the surface casing.
(6) The operator must obtain approval from the Director of the plugging method prior to plugging, and shall notify the Director of the estimated time and date the plugging operation of any well is to commence, and identify the depth and thickness of all known sources of groundwater. For good cause shown, the Director may require that a cement plug be tagged if a cement retainer or bridge plug is not used. If requested by the operator, the Director shall furnish written follow-up documentation for a requirement to tag cement plugs.
(7) Wells Used for Fresh Water. When the well, seismic, core, or other exploratory hole to be plugged may safely be used as a fresh water well, and such utilization is desired by the landowner, the well need not be filled above the required sealing plug set below fresh water; provided that written authority for such use is secured from the landowner and, in such written authority, the landowner assumes the responsibility to plug the well upon its abandonment as a water well in accordance with these rules. Such written authority and assumption of responsibility shall be filed with the Commission, provided further that the landowner furnish a copy of the permit for a water well approved by the Division of Water Resources.
b. Temporary Abandonment.
(1) A well may be temporarily abandoned when completed, upon approval of the Director, for a period not to exceed six (6) months provided the hole is cased or left in such a manner as to prevent migration of oil, gas, water or other substance from the formation or horizon in which it originally occurred. All temporarily abandoned wells shall be closed to the atmosphere with a swedge and valve or packer, or other approved method. The well sign shall remain in place. If an operator requests temporary abandonment status in excess of six (6) months the operator shall state the reason for requesting such extension and state plans for future operation. A Sundry Notice, Form 4, or other form approved by the Director, shall be submitted annually stating the method the well is closed to the atmosphere and plans for future operation.
(2) The manner in which the well is to be maintained should be reported to the Commission, and bonding requirements, as provided for in Rule 304, kept in force until such time as the well is permanently abandoned.
(3) A well which has ceased production or injection and is incapable of production or injection shall be abandoned within six (6) months thereafter unless the time is extended by the Director upon application by the owner. The application shall indicate why the well is temporarily abandoned and future plans for utilization. In the event the well is covered by a blanket bond, the Director may require an individual plugging bond on the temporarily abandoned well. Gas storage wells are to be considered active at all times unless physically plugged.
(4) In addition to the requirements of Rule 326, an injection well that is shut-in or temporarily abandoned shall have a mechanical integrity test performed within two years after the shut-in date in order to be retained in shut-in or temporarily abandoned status.
(5) If an injection well which has been shut-in or temporarily abandoned is determined not to have mechanical integrity as a result of any test required by the Commission rules and regulations, it must, within six (6) months following such a test, be either repaired and pass a mechanical integrity test or be plugged and abandoned.
320. LIABILITY
The owner and operator of any well drilled for oil or gas production or injection purposes, or any seismic, core, or other exploratory holes, whether cased or uncased, shall be liable and responsible for the plugging thereof in accordance with the rules and regulations of the Commission regardless of whether the cost of such plugging and abandonment exceeds the amount of security as set forth in Rule 304.
321. DIRECTIONAL DRILLING
If an operator intends to drill a horizontal or deviated wellbore utilizing controlled directional drilling methods, other than whipstocking due to hole conditions, the plans shall accompany an application for Permit-to-Drill, Form 2. In addition to the information required on the plat in Rule 303.c., the plat shall also show the surface and bottom hole location. If the surface location is in a different section than the bottom hole location, a plat depicting each section is required. Additionally, the proposed directional survey including two (2) wellbore deviation plots, one depicting the plan view and one depicting the side view, shall accompany the application.
Within thirty (30) days of completion the operator shall submit a Drilling Completion Report, Form 5, according to Rule 308., with a copy of the directional survey coordinate listing and the wellbore deviation plots (plan and side views). The survey data shall be provided in a single analysis report with sufficient detail to determine the location of the wellbore from the base of the surface casing to the kick off point and from that point to total depth. It shall be the operator’s responsibility to ensure that the wellbore complies with the setback requirements in Commission orders or rules prior to producing the well.
322. COMMINGLING
The commingling of production from multiple formations or wells is encouraged in order to maximize the efficient use of wellbores and to minimize the surface disturbance from oil and gas operations. Commingling may be conducted at the discretion of an operator, unless the Commission has issued an order or promulgated a rule excluding specific wells, geologic formations, geographic areas, or field from commingling in response to an application filed by a directly and adversely affected or aggrieved party or on the Commission's own motion.
This rule supercedes the procedural requirements to establish commingling and allocation contained in any Commission order as of the effective date of this rule, but does not supersede any allocation made under such order.
323. OPEN PIT STORAGE OF OIL OR HYDROCARBON SUBSTANCES
Storage of oil or any other produced liquid hydrocarbon substance in earthen pits or reservoirs is considered to constitute waste, except in emergencies where such substances cannot be otherwise contained. In such cases, these substances must be reclaimed and such storage eliminated as soon as practicable after the emergency is controlled, unless special permission to delay or continue is obtained from the Director.
324A. POLLUTION
a. The operator shall take precautions to prevent significant adverse environmental impacts to air, water, soil, or biological resources to the extent necessary to protect public health, safety and welfare, including the environment and wildlife resources, taking into consideration cost-effectiveness and technical feasibility to prevent the unauthorized discharge or disposal of oil, gas, E&P waste, chemical substances, trash, discarded equipment or other oil field waste.
b. No operator, in the conduct of any oil or gas operation shall perform any act or practice which shall constitute a violation of water quality standards or classifications established by the Water Quality Control Commission for waters of the state, or any point of compliance established by the Director pursuant to Rule 324D. The Director may establish one or more points of compliance for any event of pollution, which shall be complied with by all parties determined to be a responsible party for such pollution.
c. No owner, in the conduct of any oil or gas operation, shall perform any act or practice which shall constitute a violation of any applicable air quality laws, regulations, and permits as administered by the Air Quality Control Commission or any other local or federal agency with authority for regulating air quality associated with such activities.
d. No injection shall be authorized pursuant to Rule 325 or Rule 401 unless the person applying for authorization to conduct the injection activities demonstrates that those activities will not result in the presence in an underground source of drinking water of any physical, chemical, biological or radiological substance or matter which may cause a violation of any primary drinking water regulation in effect as of July 12, 1982 and found at 40 C.F.R. Part 141, or may otherwise adversely affect the health of persons. An underground source of drinking water is an aquifer or its portion:
(1) A which supplies any public water system; or
B which contains a sufficient quantity of ground water to supply a public water system; and
(i) currently supplies drinking water for human consumption; or
(ii) contains fewer than 10,000 milligrams per liter total dissolved solids; and
(2) which is not an exempted aquifer.
e. No person shall accept water produced from oil and gas operations, or other oil field waste for disposal in a commercial disposal facility, without first obtaining a Certificate of Designation from the County in which such facility is located, in accord with the regulations pertaining to solid waste disposal sites and facilities as promulgated by the Colorado Department of Public Health and Environment.
324B. EXEMPT AQUIFERS
a. Criteria for aquifer exemption. An aquifer or a portion thereof may be designated by the Director or the Commission as an exempted aquifer, in connection with the filing of an application pursuant to Rule 325, or Rule 401, and after notification to the Colorado Department of Public Health and Environment, Water Quality Control Division, if it meets the following criteria
(1) It does not currently serve as a source of drinking water, and either subparagraph (2) or (3) below apply;
(2) It cannot now and will not in the future serve as a source of drinking water because:
A. It is mineral, hydrocarbon or geothermal energy producing, or can be demonstrated by a person filing an application pursuant to Rule 325, or Rule 401, to contain minerals or hydrocarbons that, considering their quantity and location, are expected to be commercially producible; or
B. It is situated at a depth or location which makes recovery of water for drinking water purposes economically or technologically impractical; or
C. It is so contaminated that it would be economically or technologically impractical to render the water fit for human consumption;
(3) The total dissolved solids content of the ground water is more than three thousand (3,000) and less than ten thousand (10,000) milligrams per liter and it is not reasonably expected to supply a public water system.
b. Aquifer exemption public notice. If an aquifer exemption is required as part of an injection permit process, the injection well applicant shall apply for an aquifer exemption. This application shall contain data and information which show that applicable aquifer exemption criteria set forth in Rule 324B.a. are met. After evaluation of the application and prior to designating an aquifer or a portion thereof as an exempted aquifer, the Director shall publish a notice of proposed designation in a newspaper of general circulation serving the area where the aquifer is located. The notice shall identify such aquifer or portion thereof which the Director proposes to designate as exempted, and shall state that any person who can make a showing to the Director that the requested designation does not meet the criteria set forth in Rule 324B.a. may request the Commission to hold a hearing thereon.
c. Evaluation of written requests for public hearing. Written requests for a public hearing before the Commission shall be reviewed and evaluated by the Director in consultation with the applicant to determine if the criteria set forth in Rule 324B.a. have been met. If, within thirty (30) days after publication of the notice, the Commission receives a hearing request for which the Director determines the criteria set forth in Rule 324B.a. have not been met, the Commission shall hold such a hearing in accordance with the provisions of §34-60-108, C.R.S., 1973, as amended, and shall make a final determination regarding designation.
d. Aquifer exemption designation . If, within thirty (30) days after publication of the notice described in subparagraph b. above, the Commission does not receive a hearing request or receives a hearing request for which the Director determines the criteria set forth in Rule 324B.a. have been met, said aquifer or portion thereof shall be considered exempted thirty (30) days after publication of the notice.
324C. QUALITY ASSURANCE FOR CHEMICAL ANALYSIS
For the purpose of application for a permit for all wells authorized under Rule 323 and Rule 401, collection and analysis of water samples must comply with the Commission's approved quality assurance project plan.
324D. CRITERIA TO ESTABLISH POINTS OF COMPLIANCE
In determining a point of compliance, the Director shall take into consideration recommendations of the operator or any responsible party or parties, if applicable, including technical and economic feasibility, together with the following factors:
a. The classified use established by the Water Quality Control Commission, for any groundwater or surface water which will be impacted by contamination. If not so classified, the Director shall consider the quality, quantity, potential economic use and accessibility of such water;
b. The geologic and hydrologic characteristics of the site, such as depth to groundwater, groundwater flow, direction and velocity, soil types, surface water impacts, and climate;
c. The toxicity, mobility, and persistence in the environment of contaminants released or discharged from the site;
d. Established wellhead protection areas;
e. The potential of the site as an aquifer recharge area; and
f. The distance to the nearest permitted domestic water well or public water supply well completed in the same aquifer affected by the event.
g. The distance to the nearest permitted livestock or irrigation water well completed in the same aquifer affected by the event.
325. UNDERGROUND DISPOSAL OF WATER
a. No person shall commence operations for the underground disposal of water, or any other fluids, into a Class II well, or any well regulated by the Commission, nor shall any person commence construction of such a well, without having first obtained written authorization for such operations from the Director. Persons wishing to obtain authorization to conduct underground disposal activities shall file with the Director an Underground Injection Formation Permit Application, Form 31 and an Injection Well Permit Application, Form 33. If the disposal well is to be drilled, this application shall be submitted concurrently with the Application for Permit-to-Drill, Form 2, along with a service and filing fee to be determined by the Commission. (See Appendix III)
b. Withholding approval of underground disposal of water. The Director may withhold the issuance of a permit and the granting of approval of any Underground Injection Formation Permit Application, Form 31 and any Injection Well Permit Application, Form 33 for any proposed disposal well when the Director has reasonable cause to believe that the proposed disposal well could result in a significant adverse impact on the environment or public health, safety and welfare. In the event such approval is not granted, the Director shall immediately advise the operator and bring the matter to the Commission at its next regularly scheduled hearing.
c. The application for a dedicated injection well shall include the following information:
(1) The name, description and depth of the formation into which water is to be injected, and all underground sources of drinking water which may be affected by the proposed operation. A water analysis of the injection formation (if the total dissolved solids of the injection formation is determined to less than ten thousand (10,000) milligrams per liter, the aquifer must be exempted in accordance with Rule 322B.). The fracture pressure or fracture gradient of the injection formation.
(2) A base plat covering the area within one-quarter (1/4) mile of the proposed disposal well showing location of the proposed disposal well or wells and the location of all oil and gas wells, domestic and irrigation wells of public record and the identification of all oil and gas wells currently producing from the proposed injection zone within one-half (1/2) mile of the disposal zone. The names, addresses and holdings of all surface and mineral owners as defined in C.R.S. 34-60-103 (7), within one-quarter (1/4) mile of the proposed disposal well or wells, or all owners of record in the field if a field-wide system is proposed. These owners shall be specifically outlined and identified on the base plat. A list of all domestic and irrigation wells of public record, within one-quarter (1/4) mile of the proposed disposal well or wells, including their location and depth. (This information may be obtained at the Colorado Division of Water Resources.) Remedial action shall be required for any well within one-quarter (1/4) mile of the proposed disposal well or wells in which the injection zone is not adequately confined. The applicant shall include information regarding the need for remedial action on any well(s) penetrating the injection zone within one-quarter (1/4) mile of the proposed disposal well or wells, which the applicant may or may not operate and a plan for the performance of any such remedial work. A copy of all plans and specifications for the system and its appurtenances.
(3) A resistivity log, run from the bottom of the surface casing to total depth of the disposal well or wells or any well within one (1) mile together with a log from that well that can be correlated with the injection well. If the disposal well is to be drilled, a description of the typical stratigraphic level of the disposal formation in the disposal well or wells, and any other available logging or testing data, on the disposal well or wells.
(4) A full description of the casing in the disposal well or wells. This shall include any information available on any remedial cement work performed to any casing string. This shall also include a schematic drawing showing all casing strings with cement volumes and tops, existing or as proposed, plug back total depth, depth of any existing open or squeezed perforations, setting depths of any bridge plugs existing or proposed, planned perforations in the injection zone, tubing and packer size and setting depth. A diagram of the surface facility showing all pipelines and tanks associated with the system. A listing of all leases connected directly by pipelines to the system.
(5) A listing of all sources of water, by lease and well, to be injected shall be submitted on a Source of Produced Water for Disposal, Form 26.
(6) Any proposed stimulation program.
(7) The estimated minimum and maximum amount of water to be injected daily with anticipated injection pressures. Maximum injection pressure will be set by the Director upon approval.
(8) The names and addresses of those persons notified by the applicant, as required by subparagraph i. of this rule.
d. The application for a simultaneous injection well shall include the following:
(1) The name, description and depth of the formation into which water is to be injected, and all underground sources of drinking water which may be affected by the proposed operation. A water analysis of the injection formation (if the total dissolved solids of the injection formation is determined to be less than ten thousand (10,000) milligrams per liter, the aquifer must be exempted in accordance with Rule 324B.); a water analysis from the producing formation; and go fracture pressure or fracture gradient of the injection formation.
(2) A base plat covering the area within one-quarter (1/4) mile of the proposed well showing the location of the proposed well or wells and the location of all oil and gas wells, domestic and irrigation wells of public record and the identification of all oil and gas wells currently producing from the proposed injection zone within one-half (1/2) mile of the disposal zone and the names, addresses and holdings of all mineral owners as defined in §34-60-103 (7), C.R.S., within one-quarter (1/4) mile of the proposed disposal well or wells, or all owners of record in the field if a field-wide system is proposed. These owners shall be specifically outlined and identified on the base plat. Remedial action shall be required for any well within one-quarter (1/4) mile of the proposed well or wells in which the injection zone is not adequately confined. The applicant shall include information regarding the need for remedial action on any well(s) penetrating the injection zone within one-quarter (1/4) mile of the proposed disposal well or wells, which the applicant may or may not operate and a plan for the performance of any such remedial work and a copy of all plans and specifications for the system and its appurtenances.
(3) A resistivity log, run from the bottom of the surface casing to total depth of the disposal zone or such log from a well within one (1) mile together with a log from that well that can be correlated with the simultaneous injection well. If the simultaneous injection well is to be drilled, a description of the typical stratigraphic level of the injection formation in the simultaneous injection well or wells, and any other available logging or testing data, on the simultaneous injection well or wells.
(4) A full description of the casing in the simultaneous injection well or wells. This shall include any information available on any remedial cement work performed to any casing string. This shall also include a schematic drawing showing all casing strings with cement volumes and tops, existing or as proposed, plug back total depth, depth of any existing open or squeezed perforations, setting depths of any bridge plugs existing or proposed, planned perforations in the injection zone, downhole pump setting depth and any tubing and or packer size and setting depth.
(5) Any proposed stimulation program.
(6) The estimated amount of water to be injected daily.
(7) Downhole pump specifications, together with a calculation of maximum discharge pressure created under proposed wellbore configuration. Downhole pump configurations shall be designed to inject below the injection zone fracture gradient.
(8) The names and addresses of those persons notified by the applicant, as required by subparagraph j. of this rule.
The following rules shall apply to both dedicated injection well and simultaneous injection well applications.
e. Mechanical integrity testing requirement. Prior to application approval, the proposed disposal well must satisfactorily pass a mechanical integrity test in accordance with Rule 326.
f. Centralized and commercial disposal well requirements. Prior to application approval, the appurtenant centralized and commercial disposal well operations shall comply with the requirements of Rules 704. and 908.
g. Multiple well applications. Application may be made to include the use of more than one (1) disposal well on the same lease, or on more than one (1) lease. Wherever feasible and applicable, the application shall contemplate a coordinated plan for the entire field.
h. The designated operator of a unitized or cooperative project shall execute the application.
i. Notice of the application for a dedicated injection well shall be given by the applicant by registered or certified mail or by personal delivery, to each surface owner and owner as defined in §34-60-103(7), C.R.S., within one-quarter (1/4) mile of the proposed well or wells and to owners and operators of oil and gas wells producing from the injection zone within one-half (1/2) mile of the disposal well or to owners of cornering and contiguous units where injection will occur into the producing zones, whichever is the greater distance.
j. Notice of the application for a simultaneous injection well shall be given by the applicant by registered or certified mail or by personal delivery, to each owner as defined in §34-60-103(7), C.R.S., within one-quarter (1/4) mile of the proposed well or wells and to owners and operators of oil and gas wells producing from the injection zone within one-half (1/2) mile of the disposal well or to owners of cornering and contiguous units where injection will occur into the producing zones, whichever is the greater distance.
k. A copy of the notice of application shall be included with the disposal application filed with the Commission, and the applicant shall certify that notice by registered or certified mail or by personal delivery, to each of the owners specified in subparagraphs i. and j., has been accomplished.
l. Notice of application requirements. The notice shall describe the proposed operation and shall state that any person who would be directly and adversely affected or aggrieved by the authorization of the underground disposal into the propose injection zone may file, within fifteen (15) days of notification, a written request for a public hearing before the Commission, provided such request meets the protest requirements specified in subparagraph m. of this rule. The notice shall also state that additional information on the operation of the proposed disposal well may be obtained at the Commission office.
m. Evaluation of written requests for public hearing. Written requests for public hearing before the Commission by a person, notified in accordance with subparagraphs i. and j. of this rule, who may be directly and adversely affected or aggrieved by the authorization of the underground disposal into the proposed injection zone, shall be reviewed and evaluated by the Director in consultation with the applicant. Written protests shall specifically provide information on:
(1) Possible conflicts between the injection zone's proposed disposal use and present or future use as a source of drinking water or present or future use as a source of hydrocarbons, or
(2) Operations at the well site which may affect potential and current sources of drinking water.
n. Dedicated injection well public notice. The Director shall publish a notice of the proposed disposal permit for dedicated injection wells in a newspaper of general circulation serving the area where the well(s) is (are) located. The notice shall briefly describe the disposal application and include legal location, proposed injection zone, depth of injection and other relevant information. Comment period on the proposed disposal application shall end thirty (30) days after date of publication. If any data, information, or arguments submitted during the public comment period appear to raise substantial questions concerning potential impacts to the environment, public health, safety and welfare raised by the proposed disposal well permit the Director may request that the Commission hold a hearing.
o. Injection application deadlines . If all of the data or information necessary to approve the disposal application has not been received within six (6) months of the date of receipt, the application will be withdrawn from consideration. However, for good cause shown, a ninety (90) day extension may be granted, if requested prior to the date of expiration.
326. MECHANICAL INTEGRITY TESTING
For the purpose of this rule, a mechanical integrity test of a well is a test designed to determine if there is a significant leak in the casing, tubing, or packer of the well, and there is significant fluid movement into an underground source of drinking water through vertical channels adjacent to the wellbore.
a. Injection Wells - A mechanical integrity test shall be performed on all injection wells.
(1) The mechanical integrity test shall include one (1) of the following tests to determine whether significant leaks are present in the casing, tubing, or packer:
A. A pressure test with liquid or gas at a pressure of not less than three hundred (300) psi or the minimum injection pressure, whichever is greater, and not more than the maximum injection pressure; or
B. The monitoring and reporting to the Director, on a monthly basis for sixty (60) consecutive months, of the average casing-tubing annulus pressure, following an initial pressure test; or
C. In lieu of A. and B. any equivalent test or combinations of tests approved by the Director.
(2) The mechanical integrity test shall include one (1) of the following tests to determine whether there are significant fluid movements in vertical channels adjacent to the well bore:
A. Cementing records which shall only be valid for injection wells in existence prior to July 1, 1986;
B. Tracer surveys;
C. Cement bond log or other acceptable cement evaluation log;
D. Temperature surveys; or
E. In lieu of A.-D., any other equivalent test or combination of tests approved by the Director.
(3) No person shall inject fluids into a new injection well unless a mechanical integrity test on the well has been performed and supporting documents including Mechanical Integrity Test, Form 14B, submitted and approved by the Director. Verbal approval may be granted for continuous injection following the test.
(4) Following the performance of the initial mechanical integrity test required by subparagraph (3), additional mechanical integrity tests shall be performed on each type of injection well as follows:
A. Dedicated injection well . As long as it is used for the injection of fluids, mechanical integrity tests shall be performed at the rate of not less than one (1) test every five (5) years. The first five (5) year period shall commence on the date the initial mechanical integrity test is performed.
B. Simultaneous injection well . No additional tests will be required after the initial mechanical integrity test.
(5) Following the performance of the initial mechanical integrity test required by subparagraph (3), additional mechanical integrity tests shall be performed on each well, as long as it is used for the injection of fluids, at the rate of not less than one (1) test every five (5) years. The first five (5) year period shall commence on the date the initial mechanical integrity test is performed.
b. Shut-in Wells - All shut-in wells shall pass a mechanical integrity test.
(1) A mechanical integrity test shall be performed on each shut-in well within two (2) years of the initial shut-in date. A mechanical integrity test shall be performed on each shut-in well on five (5) year intervals from the date the initial mechanical integrity test was performed. If, at any time, surface equipment is removed or the well becomes incapable of production, a mechanical integrity test must be performed within thirty (30) days. The mechanical integrity test for a shut-in well shall be:
A. Isolation of the wellbore with a bridge plug or similar approved isolating device set one hundred (100) feet or less above the highest perforations and a pressure test with liquid or gas at a pressure of not less than three hundred (300) psi surface pressure or any equivalent test or combination of tests approved by the Director.
B. Following the performance of the initial mechanical integrity test for shut-in wells, additional tests, other than the five (5) year interval test, may be required.
c. Not less than ten (10) days prior to the performance of any mechanical integrity test required by this rule, any person required to perform the test shall notify the Director, in writing, of the scheduled date on which the test will be performed.
d. All wells shall maintain mechanical integrity. All wells which lack mechanical integrity shall be repaired or plugged and abandoned within six (6) months of failing a mechanical integrity test or of a determination through any other means that the well lacks mechanical integrity, and the well site reclaimed in accordance with Rule 1004.a. All injection wells which fail a mechanical integrity test, or which are determined through any other means to lack mechanical integrity, shall be shut-in immediately.
327. LOSS OF WELL CONTROL
The operator shall take all reasonable precautions, in addition to fully complying with Rule 317. to prevent any oil, gas or water well from blowing uncontrolled and shall take immediate steps and exercise due diligence to bring under control any such well, and shall report such occurrence to the Director as soon as practicable, but no later than twenty-four (24) hours following the incident. Within fifteen (15) days after all occurrences the operator shall submit a written report giving all details. The Director shall maintain these written reports in a central file.
328. MEASUREMENT OF OIL
The volume of all oil production from a lease or a production unit shall be measured and recorded prior to removal from the lease or production unit. The volume of production of oil shall be computed in terms of barrels of clean oil on the basis of properly calibrated meter measurements or tank measurements of oil-level differences, made and recorded to the nearest one-quarter (1/4) inch of one hundred percent (100%) capacity tables, subject to the following corrections in items a., b., and c. below. This rule shall be used consistently with standards established by the American Society for Testing and Materials (ASTM), the American Petroleum Institute (API) Manual of Petroleum Measurement Standards, the American Gas Association (AGA), the Gas Processors Association (GPA), or other applicable standards-setting organizations, and pursuant to contractual rights or obligations. Only those editions of standards cited within this rule shall apply to this rule; later amendments do not apply. The material cited in this rule is available for public inspection during normal business hours from the Public Room Administrator at the office of the Commission, 1120 Lincoln Street, Suite 801, Denver, Colorado 80203. In addition, these materials may be examined at any state publication depository library.
a. Correction for Impurities. The percentage of impurities (water, sand and other foreign substances not constituting a natural component part of the oil) shall be determined to the satisfaction of the Director, and the observed gross volume of oil shall be corrected to exclude the entire volume of such impurities.
b. Temperature Correction. The observed volume of oil corrected for impurities shall be further corrected to the standard volume of sixty degrees fahrenheit (60°F) in accordance with ASTM D-1250 Table 7, or any close approximation thereof approved by the Director.
c. Gravity Determination. The gravity of oil at sixty degrees fahrenheit 60° F. shall be determined in accordance with ASTM D-1250 Table 5, or any close approximation thereof approved by the Director.
d. Tank Gauging. Measurement by tank gauging shall be completed in accordance with industry standards as specified in API CH. 3 Gauging of Tanks (Section 3.1a Second Edition August 2005 and Section 3.1b Second Edition June 2001) and the API CH. 18.1, Measure Procedures for Crude Oil Gathered from Small Tanks by Truck (Second Edition April 1997).
e. Metering Station. Measurement shall be completed in accordance with industry standards as specified in API CH. 4 Proving Systems (Section 2, Third Edition September 2003 and Section 8, First Edition November 1995), API CH. 5 Metering (CH. 5.1 Fourth Edition October 2005, CH. 5.2 Third Edition October 2005, CH. 5.3 Fifth Edition September 2005, CH. 5.4 Second Edition July 2005, CH. 5.5 Second Edition July 2005, and CH. 5.6 First Edition October 2002), API CH. 7 Temperature Determination (First Edition June 2001), API CH. 8 Sampling (CH. 8.1 Third Edition October 1995 and CH. 8.2 Second Edition October 1995), and the API CH. 12, Calculation of Quantities (CH. 12.1 Part 1 Second Edition November 2001).
f. Lact Meters. Measurement utilizing lact units shall be in accordance with industry specifications or standards as specified in API SPEC. 6.1, Lease Automatic Custody Transfer Systems (Second Edition May 1991).
g. Sales Reconciliation. In order to facilitate the resolution of questions regarding the payment of proceeds or sales reconciliation from a well, a payee may submit a Form 37 to the payer requesting additional information concerning the payee’s interest in the well, price of the oil sold, taxes applied to the sale of oil, differences in well production and well sales, and other information as described in § 34-60-118.5, C.R.S. The payer shall return the completed form to the payee within sixty (60) days of receipt. Submittal of this form to the payer shall fulfill the requirement for “written request” described in § 34-60-118.5(2.5), C.R.S., and is a prerequisite to filing a complaint with the Commission. The payer shall use its best efforts to consult in good faith with the payee to resolve disputes regarding payment of proceeds or sales reconciliation.
A Form 37 requesting information concerning payment of proceeds may be submitted by the payee at any time. A Form 37 requesting information concerning sales volume reconciliation shall be submitted by the payee within one year of receipt of payment or the notification of a revised payment. The Commission may act to prohibit or terminate any abuse of the reconciliation process, such as the submittal by a payee of multiple repeated requests for sales volume reconciliation regarding the same well. Such action by the Commission may include, but is not limited to, relieving the payer from its obligation to answer the request and limiting or prohibiting the payee’s submittal of additional requests.
329. MEASUREMENT OF GAS
The volume of all gas produced from a lease or a production unit shall be measured and recorded prior to removal from the lease or production unit. Production of gas of all kinds shall be measured by meter unless otherwise agreed to by the Director. For computing volume of gas to be reported to the Commission, the standard pressure base shall be fourteen point seventy-three (14.73) psia, regardless of atmospheric pressure at the point of measurement, and the standard temperature base shall be sixty degrees fahrenheit (60°F). All volumes of gas to be reported to the Commission shall be adjusted by computation to these standards, regardless of pressures and temperatures at which the gas was actually measured, unless otherwise authorized by the Director. This rule shall be used consistently with standards established by the American Society for Testing and Materials (ASTM), the American petroleum Institute (API) Manual of Petroleum Measurement Standards, the American Gas Association (AGA), the Gas Processors Association (GPA), or other applicable standards-setting organizations, and pursuant to contractual rights and obligations. Only those editions of standards cited within this rule shall apply to this rule; later amendments do not apply. The material cited in this rule is available for public inspection during normal business hours from the Public Room Administrator at the office of the Commission, 1120 Lincoln Street, Suite 801, Denver, Colorado 80203. In addition, these materials may be examined at any state publication depository library.
a. Metering Station. Installation and operation of gas measurement stations shall be in accordance with industry standards as specified in API CH. 14.3, Orifice Measurement (Part 2, Fourth Edition April 2000 and Part 3, Third Edition August 1992 and Part 4, Third Edition November 1992); API CH. 21.1, Electronic Measurement (gas) (First Edition September 1993); AGA Report #7, Turbine Measurement (January 2006); AGA Report #9, Ultrasonic Measurement (April 2007); and AGA Report #11, Coriolis Measurement (January 2003).
b. Metering Equipment. The devices used to measure the differential, line pressure, and temperature shall have accepted accuracy ratings established in industry standards as specified in API CH. 22, Testing Protocol Standards (CH. 22.1 First Edition November 2006 and CH. 22.2 First Edition August 2005).
c. Meter Calibration. Meters shall be calibrated annually unless more frequent calibration is required by contractual obligations or by the Director. All calibration reports shall be created, maintained, and made available as operation records pursuant to Rule 205. In the event two consecutive meter calibrations exceed a 2% error, the operator shall report the test results to the Director who may require the operator to show cause why the meter should not be replaced.
d. Gas Quality. The heating value of produced natural gas shall be representative of the flowing gas stream at the lease or unit boundary, as determined by chromatographic analysis of a sample obtained in close proximity to the volume measurement device and shall be reported on an Operator’s Monthly Production Report, Form 7. Gas sampling and analysis shall occur annually unless more frequent sampling is required by contractual obligations or by the Director. Gas sampling, gas chromatography, and the resulting analysis data shall be in accordance with industry standards as specified in API CH. 14.1, Gas Sampling (Fifth Edition February 2006); GPA 2166, Gas Sampling (Revised 2005); GPA 2261, Gas Analysis (Revised 2000); GPA 2286, Extended Analysis; GPA 2145, Gas Physical Properties (Revised 2003); and GPA 2172, Gas Heating Value (Revised 1996).
e. Sales Reconciliation. In order to facilitate the resolution of questions regarding the payment of proceeds or sales reconciliation from a well, a payee may submit a Form 37 to the payer requesting additional information concerning the payee’s interest in the well, price of the gas sold, taxes applied to the sale of gas, differences in well production and well sales, and other information as described in § 34-60-118.5, C.R.S. The payer shall return the completed form to the payee within sixty (60) days of receipt. Submittal of this form to the payer shall fulfill the requirement for “written request” described in § 34-60-118.5(2.5), C.R.S., and is a prerequisite to filing a complaint with the Commission. The payer shall use its best efforts to consult in good faith with the payee to resolve disputes regarding payment of proceeds or sales reconciliation.
A Form 37 requesting information concerning payment of proceeds may be submitted by the payee at any time. A Form 37 requesting information concerning sales volume reconciliation shall be submitted by the payee within one year of receipt of payment or the notification of a revised payment. The Commission may act to prohibit or terminate any abuse of the reconciliation process, such as the submittal by a payee of multiple repeated requests for sales volume reconciliation regarding the same well. Such action by the Commission may include, but is not limited to, relieving the payer from its obligation to answer the request and limiting or prohibiting the payee’s submittal of additional requests.
330. MEASUREMENT OF PRODUCED AND INJECTED WATER
a. The volume of produced water shall be computed and reported in terms of barrels on the basis of properly calibrated meter measurements or tank measurements of water-level differences, made and recorded to the nearest one-quarter (1/4) inch of one hundred (100%) percent capacity tables. If measurements are based on oil/water ratios, the oil/water ratio must be based on a production test performed during the last calendar year. Other equivalent methods for measurement of produced water may be approved by the Director.
b. The volume of water injected into a Class II dedicated injection well shall be computed and reported in term of barrels on the basis of property calibrated meter measurements or tank measurements of water-level differences made and recorded to the nearest one-quarter (1/4) inch of one hundred percent (100%) capacity tables. If water is transported to an injection facility by means other than direct pipeline, measurement of water is required by a properly calibrated meter
c. The volume of water injected and produced in simultaneous injection wells shall be computed and reported in terms of barrels on the basis of calculated pump volumes, on the basis of property calibrated meter measurements, or on the basis of a produced gas to water ratio based on an annual production test.
331. VACUUM PUMPS ON WELLS
The installation of vacuum pumps or other devices for the purpose of imposing a vacuum at the wellhead or on any oil or gas bearing reservoir may be approved by the Director upon application therefore, except as herein provided. The application shall be accompanied by an exhibit showing the location of all wells on adjacent premises and all offset wells on adjacent lands, and shall set forth all material facts involved and the manner and method of installation proposed. Notice of the application shall be given by the applicant by registered or certified mail, or by delivering a copy of the application to each producer within one-half (1/2) mile of the installation.
In the event no producer within one-half (1/2) mile of the installation or the Commission itself files written objection or complaint to the application within fifteen (15) days of the date of application, then the application shall be approved, but if any producer within one-half (1/2) mile of said installation or the Commission itself files written objection within fifteen (15) days of the date of application, then a hearing shall be held as soon as practicable.
332. USE OF GAS FOR ARTIFICIAL GAS LIFTING
Gas may be used for artificial gas lifting of oil where all such gas returned to the surface with the oil is used without waste. Where the returned gas is not to be so used, the use of gas for artificial gas lifting of oil is prohibited unless otherwise specifically ordered and authorized by the Commission upon hearing.




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