Rio Grande County
San Francisco Creek Spared Wildcat Oil & Gas Exploration
Thursday, June 2, 2016
Christine Canaly, San Luis Valley Ecosystem Council (719) 256-4758, (719) 589-1518, www.slvec.org
Justin Garoutte, Executive Director, Conejos Clean Water (719) 580-9280, www.cccwater.org
After two years of litigation, local citizen environmental groups in Colorado’s remote San Luis Valley (SLV) reached an agreement yesterday with the Bureau of Land Management (BLM) that concluded the groups’ lawsuit which challenged BLM’s failure to adequately protect the Conejos aquifer an communities when approving an oil and gas proposal in 2014. The complaint challenged the BLM’s approval of an Application to Drill (APD) that included an Environmental Assessment which claimed drilling through the Conejos aquifer would result in “No Significant Impact.” Yet hydrogeologic studies confirm that drilling threatens the Conejos Formation aquifer―the lifeblood of the unique SLV aquifer system.
In 2006, BLM leased 540 acres of public mineral rights to Dan A. Hughes Oil, out of Beeville, TX. The lease tract was located outside the town of Del Norte, CO, near San Francisco Creek, a tributary to the Rio Grande. The San Luis Valley Ecosystem Council (SLVEC) and Conejos Clean Water (CCW), who initiated the lawsuit in March 2014, have now entered into a Joint Stipulated Agreement and Motion for Dismissal with the BLM that was granted by the Federal District Court of Colorado, dismissing and closing the case on June 2, 2016.
The agreement confirmed that the challenged APD and the underlying mineral lease expired by their own terms earlier this year. Both parties agreed that the termination of the APD and lease cannot be retroactively extended or renewed and neither are subject to appeal or judicial review. Should BLM wish to lease these same lands again for mineral development, BLM would have to “re-nominate the lands for inclusion in a future competitive lease sale.” The Dan A. Hughes Company has confirmed this understanding as well, stating that “Dan A. Hughes Company, L.P.'s Permit to Drill on BLM Lease COC69530 and the Lease itself have expired."
“We are relieved that this particular wildcat play has come to an end. There have been significant changes in the BLM leasing process since 2006 and the public will now have an opportunity to protest before a parcel gets leased, something that didn’t happen last go-round,” said Christine Canaly, Director of SLVEC. “Our organization has been dealing with these drilling threats around the San Luis Valley since 2007. We need to remain focused instead on the future of renewable energy development here, not fossil fuels. Protecting our aquifers is important to us and requires that we stay vigilant here at the headwaters.”
The uniqueness and importance of the Conejos Formation aquifer is well known. In 2012, facing the threat of wildcat oil and gas proposals seeking to strike it rich, a $100,000 Rio Grande Hydrogeologic Study was requested by Rio Grande County Commissioners through the Rio Grande Roundtable and funded by the Colorado Water Conservation Board. The authors made a comprehensive list of recommendations
including intermediary casing to protect the Conejos underground formation, in some areas believed to be about 5,600 feet deep. Such a casing is a key priority that emerged from the study, yet was not incorporated in BLM’s analysis or 2014 approval of the APD.
Although not resolved in this lawsuit, unique aquifers, endangered species, and the environmental justice concerns will trigger provisions of federal law that require BLM to prepare an Environmental Impact Statement and consult with the Fish and Wildlife Service before deciding whether or not to lease federal oil and gas in the SLV.
Unlike most of Colorado, the SLV has not had any appreciable oil and gas development. The Valley is populated with small rural farming and ranching communities that rely extensively on underlying aquifers for their livelihood. The agricultural traditions in the SLV have endured for centuries, and deserve protection from the boom and bust of oil and gas speculation.
“Community voices have made a difference,” says Justin Garoutte, Executive Director of CCW, “This is an Environmental Justice victory, and, as a result, we have human health protection from chemicals that would have been introduced into the groundwater through exploratory oil and gas drilling on public land. Disparate health impacts on the vulnerable populations of the entire San Luis Valley from oil and gas exploration have been avoided. Our communities have been here, in some cases for eight generations and a company simply comes in and acquires a mineral lease. Overnight, this action could have changed community dynamics for generations to come.”
The SLV holds some of the largest concentrations of wetlands in the Southwest United States that support numerous unique and endangered species and thousands of migrating birds each year. The Valley is currently experiencing a growing recreation and tourism sector. The coalition of people represented by SLVEC and CCW includes Valley ranchers and farmers, business owners, property owners and other concerned citizens. Energy & Conservation Law attorneys Allison Melton and Travis Stills represented the groups in the litigation.
SLVEC's Lawsuit is Working Towards Resolution:
Controversial oil-gas plan quietly ends
Company’s permit to drill and lease have expired
by Matt Hildner The Pueblo Chieftain
Published: April 24, 2016; Last modified: April 24, 2016 04:00AM
DEL NORTE — A contested oil and gas proposal in the foothills above town may have come to a quiet end last month.
The U.S. Bureau of Land Management sent notice to Texas-based Dan A. Hughes Co. that its 2014-issued drilling permit had expired.
Likewise, the lease the company had taken out to access the subsurface in 2006 also expired.
The company had proposed drilling a 6,600foot well roughly 5 miles south of town near San Francisco Creek. The proposal earned approvals from state regulators in 2012 and from the BLM in January 2014.
But it also prompted a lawsuit from the San Luis Valley Ecosystem Council and Conejos Clean Water, alleging that BLM had mishandled its analysis in issuing the company a lease and in approving the drilling.
Moreover, the groups argued, the agency did not adequately reveal or consider a requirement to case the well and protect the region’s groundwater or properly consider environmental justice concerns.
The agency and the lawsuit plaintiffs are due back in courtfor a status update.
Chris Canaly, director of the ecosystem council, said the group’s attorneys were waiting for clarification from the agency on whether the permit and lease could be renewed by the company before dismissing the lawsuit.
The company did not return a message from The Pueblo Chieftain.
While the San Luis Valley has been home to leasing activity in the last decade and even an exploratory well northwest of Del Norte in 2013, the last commercial production came in 1985.
That well, also near Del Norte, produced 1,855 barrels of oil in a four-month period before shutting down.
SLVEC, CCCW File Official Complaint Against BLM for Oil Drilling Decision on San Francisco Creek (3-5-14)
Check here for the Press Release
Check here to read the full complaint filed in court
BLM Releases Environmental Assessment on Hughes Application to Drill and Frack- OK to Proceed
From the Valley Courier, January 7, 2014
The Bureau of Land Management (BLM) San Luis Valley Field Office authorized the construction of a well pad and access to drill and develop an exploratory oil and gas well on private land approximately five miles south of Del Norte.
The operator must also go through Rio Grande County's conditional use permit process before work may begin.
"My decision to authorize this well is based on a thorough environmental assessment that incorporated the findings of the Rio Grande Hydrogeologic Study," said SLV Field Office Manager Andrew Archuleta. "I feel confident that the drill plan and permit requirements provide the protective measures needed to safeguard the useable water resources in the Conejos Formation." The exploratory oil and gas well will be drilled on a The BLM leased the federal mineral rights below the private land for a 10-year term in 2006.
DAHC is proposing a wildcat drilling operation with a proposed depth of 6,600 feet targeting the Dakota and Morrison horizons. The drilling operation will pass through the Conejos, Blanco Basin, and Mancos formations before encountering the Dakota and Morrison formations . The drilling operation is expected to take 45 days. The specific casing, cementing , and mud programs are detailed in the Drilling Well Plan submitted by DAHC as part of the APD (Application for Permit to Drill.) No waste pits or flare stacks are being proposed. The operator will utilize a gas-buster to flare if necessary. 35-acre lot owned by the Dan A. Hughes Company (DAHC) near County Road 13. San Francisco Creek is about a mile away from the proposed drilling pad and access road. In the event of a dry hole, the pad and access road will be graded to original contour, topsoil will be replaced and the entire area reseeded according to the Surface Use Plan of Operations. Rehabilitation of the well pads and access roads are bonded to ensure compliance with BLM reclamation requirements.
The drill plan requires that intermediate casing be used through all useable water bearing zones. The BLM and the Colorado Oil and Gas Conservation Commission will conduct inspections during and after drilling operations to ensure compliance with the permit. These inspections will include checking the integrity of the well and casing as well as other standards spelled out in the permit.
In its environmental assessment , the BLM stated: "Due to scarcity of surface water in the area, groundwater is heavily utilized for agricultural and domestic uses. Therefore, protection of this vital and vast groundwater resource is essential. During the drilling process, the proposed well would pass through usable groundwater aquifers. Potential impacts to groundwater resources could occur if appropriate cementing and casing programs are not strictly followed."
To address these concerns, BLM would require all cas- stated: "The proposed action could have a temporary negative impact on air quality which would mostly occur during the construction phase. To counteract this, BLM would require Dan A. Hughes Company to use industry best practices, including watering, graveling, and reseeding to reduce fugitive dust emissions from vehicular traffic and disturbed surfaces."
Regarding the wildlife concern , the BLM report found 15 species of threatened, endangered, candidate or sensitive wildlife, fish and plants in the affected area. These included Gunnison prairie dog, Northern leopard frog, milk snake, bald eagle, ferruginous hawk, peregrine falcon, mountain plover, burrowing owl, Brewer's sparrow, fringed myotis, big free-tailed bat, Townsend's big-eared bat, Rio Grande cutthroat trout, Rio Grande sucker and Rio Grande chub. The proposed action would occur on privately owned surface lands within an existing subdivision. Potential impacts from this project include effects caused by construction of an access road approximately 1,320 feet in length with a 40 foot wide ground disturbance during construction, 14 foot wide completed road surface, and construction of a drilling pad approximately 2.3 acres in size. While the physical loss of habitat from these features is relatively small (approximately 3.5 acres), the added disturbance caused by increased human presence and equipment (and associated noise, etc.) may result in a larger disturbance footprint than the construction footprint alone. These indirect impacts would occur during construction and exploratory drilling phases, expected to take approximately 45 days. Mitigation measures would include: Construct, modify and maintain all open-vent exhaust stacks to prevent birds and bats from entering, and to discourage perching, roosting and nesting; minimize involvement of prairie dog burrow systems, if prairie dogs are present and restrict activities during Gunnison prairie dog reproductive period; and conduct raptor nest and winter eagle roost surveys.
Regarding big game disturbance , the BLM mitigation measure would be to provide additional protection of big game winter range by allowing no drilling from December 1 to April 30. The BLM has not received any proposals for further oil and gas development in this area. Additional ground disturbing operations would require additional environmental analysis.
To view the environmental assessment, decision record and other information concerning the oil and gas well, log on to http://www.blm.gov/co/st/en/fo/slvfo/Current_Planning_Efforts/San_Francisco_APD1.html. For more information, contact Andrew Archuleta at 719-655-2547 . Casings that run through the well should be cemented from bottom to top so that no casing will be exposed directly to the fresh or usable water zone, or to the targeted oil and gas formations. Shallow aquifers would be protected by extending and properly cementing the conductor casing to adequate depths.
The terms of the drilling permit require the operator to obtain approval from the BLM before conducting hydraulic fracturing operations . The operator is also required to abide by all state regulations regarding the use and reporting of hydraulic fracturing operations.
A 1,320-foot road will be constructed across the company's property to the well. The drill pad will disturb approximately 2.3 acres and will be enclosed with straw bales to minimize drilling noise. No evaporation ponds will be permitted for waste water, instead, a closed loop drilling system will be used to either recycle the water for further use or the water will be disposed of offsite at an authorized facility.
On August 20, 2012, the San Luis Valley Field Office announced a 30-day scoping period for the San Francisco Creek #1 E A. The BLM also held a public scoping meeting on September 6, 2012 at the Rio Grande County Annex in Del Norte. Over the course of the 30-day period the BLM received 42 written comments addressing a wide range of resource concerns and issues. The public comments identified many issues the BLM addressed within its environmental analysis, such as water and air quality, wildlife, visual resources and geology.
There were also scoping comments that did not constitute an "issue" requiring analysis under NEPA (National Environmental Policy Act.) Some examples of those concerns included statements about whether or not oil and gas development was necessary (generally expressed as a "favor" or "oppose" position statement); concerns regarding potential for a larger oil field development if producible quantities of minerals are discovered (outside the scope of this analysis); and the effect of local land-use ordinances on BLM authority (previously decided by law). The BLM also received many comments encouraging consideration of the Rio Grande County Hydrology study. While not generally part of a routine EA for an APD, the BLM was able to work cooperatively with the Rio Grande County team to consider their findings within the BLM analysis.
The BLM released a draft of this EA on June 18, 2013 and extended the comment period for a total of 45 days. The BLM received more than 40 comments on the draft and carefully considered every comment. Based on the comments received, the BLM supplemented, improved, and modified this analysis where appropriate.
Regarding the air quality concern, the BLM report Editor's note: The above information was provided through a press release from the BLM and excerpts from the environmental assessment document.
San Francisco & Old Woman’s Creek Applications to Drill
September 15, 2013-
SLV Ecosystem submitted our comments to the Bureau of Land Management concerning the draft Environmental Assessment for the drilling proposal on San Francisco Creek (permit application for hydrocarbon drilling exploration.)
Click the following links to view our comments General Comments (Part1)
The First Liberty Energy project well on Old Woman's Creek near Del Norte has been capped and sealed without finding any financially viable hydrocarbon yield. First Liberty conducted exploratory fracking at the zone of most potential. This was not a lateral frack but one along the main bore. First Liberty has publically stated that they will not be pursuing any other explorations at this time. For a comprehensive story on this please go to this link.
Here is a Valley Courier report on the hydrological study results. Click here
You can download and study the Rio Grande County Hydrological Study by going to this link and scrolling down to RGC Hydro Study.
We are currently involved in a filed complaint to alter the permit requirements for an exploratory well along San Francisco Creek in the eastern foothills of the San Juan Mountains, near the Town of Del Norte, CO. San Francisco Creek is a tributary to the Rio Grande which is just a few miles downstream from the proposed drilling site. Dan A. Hughes, from Texas, wants to explore a small seam of sedimentary deposits that was previously explored in the early 1960s & 80’s. At that time, the seam was judged to be too small to be economically feasible. Hughes hopes that new methods that drill directly into the source rock and then use hydraulic fracturing (fracking) might yield more hydrocarbons. A nearby project on Old Woman's Creek has been sealed and abandoned after not finding commercially viable oil or gas yield even with fracking.
SLVEC has been organizing area residents since 2010 and has encouraged Rio Grande County Commissioners to pass strict oil and gas drilling regulations that would require Hughes to pay for a household water quality well testing baseline within a three mile radius of the proposed drill site. SLVEC has also met regularly with the water user community through the Rio Grande Roundtable. The recent First Liberty proposal and subsequent drilling galvanized the agricultural community. Waterusers met with Rio Grande County Commissioners requesting that a hydrologic and geologic study be conducted to determine baseline data on the Conejos volcanic formation to analyze the direction of water flow and provide support to determine at what depth the drill casing will need to be cemented to protect upper aquifers. Local geologists have speculated that we may need a casing depth of over 4,000 ft. to protect water quality. This argument convinced the Rio Grande County Commissioners to request that the COGCC not issue any Oil and Gas permits until this study is complete. COGCC ignored this request and granted the request by Hughes to drill. The study has since been completed and may be viewed through the link above.
The BLM Environmental Assessment (EA) for the Hughes application on San Francisco Creek was released in early 2014. Please return to this site for timely information about this process.
San Francisco Creek, a tributary to the Rio Grande near Del Norte, Colorado, runs through a residential sub-division with a split estate situation of private surface rights, but mineral rights belonging to BLM (Bureau of Land Management). This area has already experienced minimal exploration for oil during the 1950's, 60's and early 80's. Small amounts of oil were found in a rock formation that is not contiguous with the rest of the Valley–an anomaly that is a remnant of a previous geological formation–but the wells were abandoned and the deposit deemed insufficient to warrant further exploration.
Dan Hughes Oil Company, a Texas exploration and investment firm, plans to do exploratory drilling within the sub-division not far from San Francisco Creek. They secured a minerals lease from BLM in 2006 and recently purchased a lot (#46) on which to site their drilling rig. Hughes recently filed an APD (Application for a permit to drill) for a 6,600 ft. exploratory well. They filed this APD with the Colorado Oil and Gas Conservation Commission (COGCC).The COGCC has granted this drill permit.
Local residents are in the process of organizing to research and monitor COGCC-Colorado oil and gas regulations (The state process) but there is also a NEPA (National Environmental Policy Act) federal BLM permitting process, which will involve public participation and comment. The BLM is expected to release the inital Evironmental Assessment by June 1, 2013, initiatiating the feveral comment process. There are also local Rio Grande County oil and gas regulations for citizens to become informed about.
http://www.riograndecounty.org/images/stories/docs/landuse/OG_2_2011_final.pdf (or refer below.)
SLVEC's comments to COGCC and other support material are posted below:
- Environmental Assessment on Proposed Oil and Gas Drilling on the Baca National WiIdlife Refuge, pg. 54-65, April 2011504.85 KB
- Well Location Map778.94 KB
- Well Location by Lot Number928.56 KB
Hughes Application to the COGCC
- Topo Map1.01 MB
- Hughes Surface Use Plan37.04 KB
- Pad Construction141.54 KB
- Southwest Willow Flycatcher Map, ERO Resources Group, Denver, CO. 20071.1 MB
- Colorado Natural Heritage Program, Center for Native Ecosystem Elemental Occurance Map1.29 MB
- Cross Section of SLV (US Fish and Wildlife Service)266.61 KB
- Hughes Form 2 application69.26 KB
- Hughes Drilling Plan374.08 KB
- BLM Mineral Leasing Map224.35 KB
- Hughes APD Submittal to the COGCC75.88 KB