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Gas firm fined $371,200

Dennis WebbGlenwood Springs correspondent

A state commission had harsh words for EnCana Oil & Gas Tuesday but declined to give it a harsher penalty than recommended for drilling errors that caused natural gas to surface south of Silt this spring.The Colorado Oil and Gas Conservation Commission, concluding a two-day hearing at the Ramada Inn in Glenwood Springs, went along with a recommendation from its staff that it approve a $371,200 fine against EnCana.The fine, while the most ever levied for a single incident of drilling violations, was less than Garfield County had requested. County Attorney Don DeFord had asked that the company be fined $464,000, the maximum allowable for the nine violations it committed in connection with the seep.COGCC board members joined DeFord and others in sharply criticizing EnCana’s actions that led to the seep.”In my opinion it was through sheer unadulterated incompetence that we are here today and over the last few days to address this problem,” COGCC commissioner John Ashby said, addressing EnCana representatives. “I’m very upset about that. I think it reflects poorly on the industry and on your company in particular.”Said fellow Commissioner Tom Ann Casey, “It’s not a problem with the geology, it’s a problem of some people not following the rules.”The seep occurred when EnCana encountered difficulties sealing off around the Schwartz 2-15B well casing in the West Divide Creek area, allowing gas to escape through a geological fault and to surface in the creek. The seep caused the creek and groundwater to be contaminated with cancer-causing benzene.Under a pretrial agreement between EnCana and COGCC staff, but subject to the COGCC board’s review, the company admitted to nine violations arising from the incident and endorsed the recommended fine.DeFord argued that the violations were of an aggravated nature that warranted imposing the maximum fine on EnCana.He said it’s part of a pattern of continuing local violations by EnCana that can’t be justified simply by the amount of gas development it does in the area.”Yes, they are an active developer in Garfield County, and yes, they are an active violator in Garfield County,” DeFord said.He said EnCana both knowingly and recklessly violated state rules. The county wanted the company to be sent a message that it will be held accountable, “and that the citizens of this county need to be protected.”Carolyn Lamb, an attorney with the Western Colorado Congress citizens group, shared DeFord’s views.”Without sending a strong message to EnCana we fear we will end up here again in short order,” she said.But Carol Harmon, an attorney representing COGCC’s staff, said the $371,200 fine already took into account aggravated circumstances resulting from EnCana’s actions.State law, while allowing fines of up to $1,000 per day per violation, normally caps the fine per violation at $10,000, which would have been $90,000 in EnCana’s case. That amount could be exceeded only when aggravating circumstances exist, she said.EnCana’s violations reflected aggravated circumstances, and were calculated based on violations that lasted from 36 to 55 days each.The state reduced EnCana’s fine from the maximum allowable under aggravated circumstances because of its prompt response to the seep once it was discovered, and continuing cooperation with the state in providing drinking water, monitoring groundwater and taking other remediation measures. The county also asked the state to order EnCana to pay for someone to work under the supervision of the COGCC as it continues its remediation efforts. The COGCC board did not specifically provide for that in its decision, though commissioners expressed interest in making sure adequate staffing exists to oversee remediation.The county and WCC also pressed for expanded testing in the area surrounding the seep. COGCC representatives said the agency will have latitude within the agreement reached with EnCana to request more groundwater monitoring and other remediation measures as required.


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