A Denver oil and gas company is facing about $1.8 million in penalties and the possibility of losing its ability to operate in Colorado after state regulators decided it violated several state regulations.

Next, the Colorado Oil and Gas Conservation Commission will decide if K.P. Kauffman Co. engaged in a pattern of violations. A hearing is for Sept. 20-21, during which the COGCC will decide whether to prohibit the company from receiving any new permits.

K.P. Kauffman can appeal the decision.

The COGCC wrapped up several days of hearings Monday and announced a final penalty. The commission staff had recommended fining K.P. Kauffman $3.7 million.

But the COGCC dismissed some alleged violations because the statute of limitations had expired and consolidated others. In some cases, the commissioners decided the staff didn’t provide enough evidence.

The COGCC determined that K.P. Kauffman violated rules on reporting spills and the status of flowlines, which carry oil and gas from a well to other equipment, and letting the agency know what it was doing to correct problems. The commissioners agreed with the staff’s allegations that the company missed deadlines on filing cleanup plans.

K.P. Kauffman also improperly disposed of oil and gas wasted on a field and near a pond and wetlands. The company’s lawyers said the field belonged to K.P. Kauffman.

The company is an “unreliable, incapable and impactful” operator, said Caitlin Stafford,an assistant attorney general representing the COGCC staff.

John Jacus, an attorney representing K.P. Kauffman, said the company has changed its policies and practices. During the hearings, he contended the COGCC staff conflated missing deadlines for filing reports with actual threats to public health and safety and the environment.

In the case of violations involving the cleanup of a group of batteries, the company encountered “significant historic contamination” from previous owners, K.P. Kauffman lawyers said. That complicated and delayed the work, they said.

K.P. Kauffman, a family-owned business, has about 1,200 oil and gas wells. Most of those are in Weld County.

Source: Read Full Article