Colorado leaders uncertain about flood impact on oil, gas sites

Houston (Platts)--16Sep2013/232 pm EDT/1832 GMT


Colorado officials on Monday were still trying to get a handle on the extent of damage to oil and natural gas operations as a result of flooding that has devastated large areas of the state.

Tisha Schuller, president and CEO of the Colorado Oil & Gas Association, said Monday at a meeting of Colorado Oil and Gas Conservation Commission that initial reports indicate that the flooding would result in relatively minor environmental impacts from oil and gas wells pads and other facilities.

"As far as we know, all the wells that have been affected by flooding have been shut-in," she said.

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"The majority of operators have had little to no impact on their well sites, but those that are affected are actively monitoring and working with the COGCC and with emergency responders," Schuller said.

As flooding started September 11, oil and gas producers across the state established incident command centers. The command centers ordered well sites shut in advance of the rising waters, she said.

"The most significantly impacted area of the state is the [Denver-Julesburg Basin] along the Front Range. There haven't been any reports of flooding affecting oil and gas in other parts of the state," Schuller said.

Operators in flood-affected regions have reported impacts "ranging from [being] unaffected to standing water to locations in rushing water," she said.

"There have been minor incidents," of floodwater damaging some oil or gas locations, Schuller said, adding: "We know of two confirmed empty tanks that are floating."

Mike King, executive director of the Colorado Department of Natural Resources, noted social media images of the flooding included "pictures of some tanks that appear to be oil- and gas-related floating down the South Platte River."

Schuller said the tanks in question were empty tanks that had become unmoored when the lines securing them to a facility where they were located broke.

Other social media reports have shown images purported to be condensate tanks and spills of hydraulic fracking fluid. Schuller said COGA could not confirm the reports because most of the social media sites failed to pinpoint a location for the alleged damage.

Schuller said COGA would continue collecting details of damage from producers in the state and reporting that data to state authorities as floodwaters recede and operators are able to access their sites.

"Companies from the smallest to the largest operators are engaged in round-the-clock assessment," she said. "This has been going on since flooding began."

COGCC Director Matt Lepore said that since floodwaters are still making access to drilling locations throughout the state difficult, it is impossible to determine how many oil and gas sites have been impacted and to what extent.

Lepore said the commission staff is compiling "an ongoing spreadsheet" on the status of oil and gas locations throughout the state as information about them becomes available.

"We will serve as a clearinghouse as operators are getting back out to their locations," he said. "We can tell if a location has been shut-in and, yes we know the status of that location or no, we don't know."

Meanwhile, two large Denver-Julesburg Basin producers provided details of their assessments of flood damage.

"The flooding has impacted our DJ Basin operations north of Denver," Encana spokesman Doug Hock said in an email statement. Hock said the producer has closed its Front Range field office in Longmont.

"We have also shut-in wells in those areas hardest hit. The wells will remain shut-in until weather stabilizes and water recedes," he said.

Hock said Encana plans to inspect all of its facilities "and we've developed an environmental inspection checklist to assist with the assessment."

The producer is using geographic information systems equipment "to help prioritize lower lying facilities that may likely have greater impacts," he said.

A posting on the Anadarko Petroleum website Monday said the producer had shut about 600 of its company-operated wells in the Wattenberg field.

"The majority of our drilling, completions and workover activities in the affected areas of the field have been shut down, and restarting the activities is expected to be significantly delayed due to road and location conditions," the posting states.

--Jim Magill, jim.magill@platts.com --Edited by Keiron Greenhalgh, keiron.greenhalgh@platts.com

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