Oil and Gas Operations and Colorado’s Floods: The Colorado Oil and Gas Conservation Commission Tackles the Issues

The heavy rainfall and flooding that occurred in the second week of September brought devastation to many families, homes, and businesses in Colorado.  With 374 families remaining in temporary housing, recovery from the storms has been a slow process for those acutely affected.  After the rain subsided and the flood levels receded, another concern emerged for Coloradans: damage to oil and gas operations in the floodway.

The Colorado Oil and Gas Conservation Commission (“COGCC”), a state agency in the Colorado Department of Natural Resources, is responsible for the regulation of oil and gas development in the state.  During the extensive rainfall and following the destructive flooding, the COGCC worked with the Federal Emergency Management Agency (“FEMA”), the Colorado emergency response operations, the United States Environmental Protection Agency (“EPA”), and other organizations to oversee the response to spills and oil and gas operations damaged in the flood.

Alan Gilbert, an attorney with decades of experience in energy and environmental law, was appointed Special Assistant to the Executive Director for Flood Response to monitor the inspection and cleanup of oil and gas operations.  On Friday, November 8, Mr. Gilbert gave a presentation to the Natural Resources Section of the Colorado Bar Association to outline the COGCC’s ongoing response to the flood damage.

Mr. Gilbert noted that Colorado has many wells that operate within floodplains of the St. Vrain and Platte Rivers in central and northeast Colorado.  Often, these well sites were chosen to keep drilling operations off of valuable agricultural land.  During the first few days of heavy rain, when it became clear that massive flooding was imminent, oil and gas companies with wells in the floodplains preemptively started to shut-in wells.  Mr. Gilbert explained that when a well is shut-in, valves are closed to stop production, which creates a seal between the well bore and the land surface.  This process contains any oil or gas underground if surface operations are damaged.  Fortunately, a majority of wells today can be shut-in remotely, but some still require employees to manually shut-in the well at the well site.  In total, oil companies shut-in 2,603 wells during the flooding.  Today, 691 of the wells remain shut-in, awaiting inspection or repairs before resuming operations.  However, with these wells closed and not in production, leaseholders, including many families that depend on the income, will not receive any royalty payments.

Fortunately, Mr. Gilbert explained, the shut-in wells withstood the flooding with almost no damage or leaks reported to the well structures themselves.  However, many storage tanks, soil and metal berms around wells, and pipelines sustained damage from water flow or debris carried by the water.  As many media pictures reported, the flooding toppled some tanks; unanchored pipelines and caused leaks; lifted some underground tanks to the surface; and caused oil, condensate, and produced water to escape in certain areas.  While the rain continued to fall, the COGCC began discussing how to address the problems.  The COGCC, with EPA assistance, took aerial surveys of affected areas and began traveling to the areas to inspect damaged wells.  The COGCC brought in and trained many additional teams of inspectors to handle the increased workload.

The COGCC, through inspections and operator reports, immediately began to compile and assess spill data.  As of November 8, the COGCC reported total spills of 1,149 barrels (48,250 gallons) of oil and condensate and 1,035 barrels (43,479 gallons) of produced water originating from storage tanks and leaking pipelines.  These totals came from forty-nine total spills, fourteen of which were in excess of twenty barrels.  Twenty spills only comprised produced water, and the single largest spill amounted to 323 barrels.  Mr. Gilbert reported that there was no single catastrophic spill and no significant buildup of spilled material in any area.

A major concern of Coloradans revolved around the effects of flooding on hydraulic fracturing (“fracking”).  However, the COGCC reported that no fracking operations were active in the floodplains during the flooding, and thus no fracking fluid spillage.  Mr. Gilbert explained that fracking is not a continuous operation in oil and gas production and only takes place during limited times at each well site.  While the initial staging of two fracking operations started at the beginning of the rainfall, operators moved both of them safely out of the affected areas before significant flooding occurred.  Although many media outlets speculated about discovering fracking disasters when the water receded, these fears were unnecessary as all fracking had terminated prior to the flooding.

Since the floodwaters have receded, the COGCC has taken many steps to respond to the damage, including assisting operators to inspect and repair damaged equipment, cleaning up any spilled toxic substances, and continuing evaluations of damage and response efforts.  The professional, technically trained staff of the COGCC has researched and written many reports to assist the industry in safely cleaning up, repairing, and returning affected oil and gas operations to normal production.  These reports include start-up procedures for undamaged shut-in wells, worker health and safety information for workers exposed to floodwaters containing E. coli and other hazards, recommended practices for flood impact zone reconstruction, and a notice to operators of new reporting requirements  for wells in flood impact zones.  Finally, the COGCC has requested a formal report from the oil and gas industry outlining all spills and damage.  In addition, an interim committee has been formed in the Colorado General Assembly to provide further oversight of the cleanup operations.

Mr. Gilbert reported that the COGCC has learned many lessons from the flooding that will better prepare them for future floods.  First, while both soil and metal berms should be built around wells to contain any material in case of a spill, the flooding and debris from this flood demonstrated that the metal berms stood up to the damage much better than soil.  Second, the anchoring systems for tanks and pipelines need better design and construction to keep tanks in place during violent weather.  Third, wells with remote shut-in capabilities are very beneficial to control wells inaccessible due to dangerous weather.  The COGCC is planning to hold future workshops to discuss COGCC action in response to these lessons.

In summary, no form of energy production is without risk, and it is important that oil and gas operations in Colorado are well prepared to prevent spills, even in the face of the most violent natural disasters.  While all spills of toxic materials are significant and serious, the quick action by the oil and gas industry and immediate response to the flooding by the COGCC kept Colorado lands free from any major threat to the environment or public health.

 

Additional Resources

The COGCC has documented and published all reports about the flooding and response on their website at http://cogcc.state.co.us/Announcements/Hot_Topics/Flood2013/Flood.htm. The website includes the COGCC map showing wells in the flood impact zone; COGCC start-up procedures for undamaged shut-in wells; COGCC health and safety information for workers exposed to floodwaters containing E. coli and other hazards; and COGCC recommended practices for flood impact zone well reconstruction.