Inspections lagging amid oil, gas boom
By Kim McGuire and Jeffrey A. Roberts
Denver Post Staff Writers
DenverPost.com
While the number of operating oil and gas wells has climbed 30 percent to 29,000 since 2000, Colorado Oil and Gas Conservation Commission inspections have not kept pace.
That has led some landowners to worry that violations are not being flagged.
The state has just eight inspectors - one for every 3,625 wells. Wells are inspected on average once every 3 1/2 years, the commission estimates.
By comparison, Wyoming has one inspector for every 2,750 wells and New Mexico has one for every 2,100, according to state data.
"We know that every day there are accidents and incidents in the field - just look at the commission's reports," said Peggy Utesch, a member of the Grand Valley Citizens Alliance, a Garfield County-based citizens group.
"Well, if they can inspect once every three years, how are they possibly going to catch it all?" she asked.
A Denver Post analysis of about 43,000 inspections between 2000 and 2005 found that wells passed inspection 87 percent of the time. But when inspectors responded to citizen complaints, the failure rate rose to 40 percent from 13 percent.
Critics say the higher failure rate is a sign the that oil- and gas-field mishaps occurring outside landowners' watchful eyes might be falling through the regulatory cracks.
Commission officials say responding to public complaints is a top priority, which is why inspection failure rates climb when residents who live near wells voice concerns.
They say serious incidents are rare and major problems are detected.
In 2005, the commission added two new employees, bringing the total number of field inspectors to eight.
The legislature's Joint Budget Committee has recommended giving the commission $848,000 to pay for 12 new employees, including two more inspectors, to help them keep up with the crush of drilling activity and permit requests.
"That's a direct reflection of what we think the resources need to be to get us in the direction we should go in for the next few years," said Brian Macke, the commission's director.
This year, an estimated 3,000 new wells are slated to be drilled, and the commission ended 2005 with a backlog of 757 applications for drilling permits, according to the commission.
The inspection rate in Colorado has slipped from having about one out of 2.9 wells inspected each year in 2000 to one of 3.3 wells in 2005, according to commission data.
Field inspectors are so swamped with routine inspections and responding to complaints, they seldom inspect wells as they're being constructed, Macke said.
"We rely heavily on company reports they attest to, that they send to us," Macke said. "It would be good to increase our percentage of visually observing those types of operations."
Commission staff say they work hard to ensure operators comply with the rules, which cuts down the number of violations they cite each year.
If the commission does cite a violation - a more serious offense than failing an inspection - it's usually for a well pad that hasn't been cleaned or signs that haven't been posted, they say.
After those are resolved, it's up to the individual inspector to decide what warrants attention, they say.
Over the years, Jack Wyscaver had compiled a long list of complaints against the West Virginia-based operator drilling on his 160-acre spread near Kersey. After Wyscaver persuaded one of the commission's environmental protection specialists to visit his property, a notice of violation was quickly issued against the company.
"It just goes to show that if the public doesn't complain, nothing will ever get done," Wyscaver said. "Some operators will really test the limits."
Craig Van Kirk, the head of the petroleum engineering department at the Colorado School of Mines, said it's difficult to say whether oil and gas operations are receiving adequate scrutiny.
Much depends on what kind of wells the inspectors are checking, not just how frequently, he said.
"If you're a smoker, you should probably see a doctor more than a nonsmoker," Van Kirk said. "Wells are the same. Those in high-pressure fields should probably be evaluated more than those that are not. Ones that are new should probably need more frequent inspections than old, proven ones."
While the majority of Colorado operators are passing inspections, 20 companies have violation rates that exceed 50 percent, The Post's analysis shows.
Commission staff say most of those companies are small producers that buy wells at the end of the life cycle, take what's left and sometimes leave the well pads in poor shape.
In at least three cases, the commission has seized companies' bonds to make sure their messes got cleaned up.
Residents of the heavily drilled Western Slope say state regulators can't let up on operators - pointing to such incidents as the 2004 gas seep that resulted in the release of benzene into Divide Creek in Garfield County.
The commission fined the operator, EnCana Corp., more than $371,000 for the seep, which polluted many local water wells.
More troubling, residents say, is when the commission doesn't sanction operators that create problems on their property.
Nancy Jacobsen and Gary Gagne, whose ranch is just south of Silt, say they caught EnCana, in the spring of 2003, filling in a waste pit on their property without first pumping out the liquids.
But a commission inspector told the couple he couldn't sanction the company because the couple had stopped the company from finishing the job.
"I tell people it doesn't matter if you catch a company red-handed doing something they shouldn't," said Jacobsen. "Billy Jack ain't coming to help."
At the time, EnCana officials said the company could have allowed the liquids to evaporate but wanted to clean up the pit as quickly as possible.
"Overall, the state's regulations are very clear regarding routine inspections and general operations," said Doug Hock, an EnCana spokesman.
Hock said EnCana and the commission have been able to work together to come up with a new cement procedure designed to prevent seeps like the one that tainted Divide Creek. The Grand Valley Citizens Alliance is now teaching residents how well pads should be cleaned. That way, said Utesch, of Garfield County, residents can provide an extra set of eyes to check up on operators. "Having more people on the ground can't hurt," she said.
By Kim McGuire and Jeffrey A. Roberts
Denver Post Staff Writers
DenverPost.com
While the number of operating oil and gas wells has climbed 30 percent to 29,000 since 2000, Colorado Oil and Gas Conservation Commission inspections have not kept pace.
That has led some landowners to worry that violations are not being flagged.
The state has just eight inspectors - one for every 3,625 wells. Wells are inspected on average once every 3 1/2 years, the commission estimates.
By comparison, Wyoming has one inspector for every 2,750 wells and New Mexico has one for every 2,100, according to state data.
"We know that every day there are accidents and incidents in the field - just look at the commission's reports," said Peggy Utesch, a member of the Grand Valley Citizens Alliance, a Garfield County-based citizens group.
"Well, if they can inspect once every three years, how are they possibly going to catch it all?" she asked.
A Denver Post analysis of about 43,000 inspections between 2000 and 2005 found that wells passed inspection 87 percent of the time. But when inspectors responded to citizen complaints, the failure rate rose to 40 percent from 13 percent.
Critics say the higher failure rate is a sign the that oil- and gas-field mishaps occurring outside landowners' watchful eyes might be falling through the regulatory cracks.
Commission officials say responding to public complaints is a top priority, which is why inspection failure rates climb when residents who live near wells voice concerns.
They say serious incidents are rare and major problems are detected.
In 2005, the commission added two new employees, bringing the total number of field inspectors to eight.
The legislature's Joint Budget Committee has recommended giving the commission $848,000 to pay for 12 new employees, including two more inspectors, to help them keep up with the crush of drilling activity and permit requests.
"That's a direct reflection of what we think the resources need to be to get us in the direction we should go in for the next few years," said Brian Macke, the commission's director.
This year, an estimated 3,000 new wells are slated to be drilled, and the commission ended 2005 with a backlog of 757 applications for drilling permits, according to the commission.
The inspection rate in Colorado has slipped from having about one out of 2.9 wells inspected each year in 2000 to one of 3.3 wells in 2005, according to commission data.
Field inspectors are so swamped with routine inspections and responding to complaints, they seldom inspect wells as they're being constructed, Macke said.
"We rely heavily on company reports they attest to, that they send to us," Macke said. "It would be good to increase our percentage of visually observing those types of operations."
Commission staff say they work hard to ensure operators comply with the rules, which cuts down the number of violations they cite each year.
If the commission does cite a violation - a more serious offense than failing an inspection - it's usually for a well pad that hasn't been cleaned or signs that haven't been posted, they say.
After those are resolved, it's up to the individual inspector to decide what warrants attention, they say.
Over the years, Jack Wyscaver had compiled a long list of complaints against the West Virginia-based operator drilling on his 160-acre spread near Kersey. After Wyscaver persuaded one of the commission's environmental protection specialists to visit his property, a notice of violation was quickly issued against the company.
"It just goes to show that if the public doesn't complain, nothing will ever get done," Wyscaver said. "Some operators will really test the limits."
Craig Van Kirk, the head of the petroleum engineering department at the Colorado School of Mines, said it's difficult to say whether oil and gas operations are receiving adequate scrutiny.
Much depends on what kind of wells the inspectors are checking, not just how frequently, he said.
"If you're a smoker, you should probably see a doctor more than a nonsmoker," Van Kirk said. "Wells are the same. Those in high-pressure fields should probably be evaluated more than those that are not. Ones that are new should probably need more frequent inspections than old, proven ones."
While the majority of Colorado operators are passing inspections, 20 companies have violation rates that exceed 50 percent, The Post's analysis shows.
Commission staff say most of those companies are small producers that buy wells at the end of the life cycle, take what's left and sometimes leave the well pads in poor shape.
In at least three cases, the commission has seized companies' bonds to make sure their messes got cleaned up.
Residents of the heavily drilled Western Slope say state regulators can't let up on operators - pointing to such incidents as the 2004 gas seep that resulted in the release of benzene into Divide Creek in Garfield County.
The commission fined the operator, EnCana Corp., more than $371,000 for the seep, which polluted many local water wells.
More troubling, residents say, is when the commission doesn't sanction operators that create problems on their property.
Nancy Jacobsen and Gary Gagne, whose ranch is just south of Silt, say they caught EnCana, in the spring of 2003, filling in a waste pit on their property without first pumping out the liquids.
But a commission inspector told the couple he couldn't sanction the company because the couple had stopped the company from finishing the job.
"I tell people it doesn't matter if you catch a company red-handed doing something they shouldn't," said Jacobsen. "Billy Jack ain't coming to help."
At the time, EnCana officials said the company could have allowed the liquids to evaporate but wanted to clean up the pit as quickly as possible.
"Overall, the state's regulations are very clear regarding routine inspections and general operations," said Doug Hock, an EnCana spokesman.
Hock said EnCana and the commission have been able to work together to come up with a new cement procedure designed to prevent seeps like the one that tainted Divide Creek. The Grand Valley Citizens Alliance is now teaching residents how well pads should be cleaned. That way, said Utesch, of Garfield County, residents can provide an extra set of eyes to check up on operators. "Having more people on the ground can't hurt," she said.
