Oil and gas companies leaving without cleaning up sites; state believes problem will get worse

DENVER -- You might be used to seeing abandoned tools and farm equipment on the side of the road -- but abandoned oil and gas sites?

Adams County resident Barber Binder says what is happening in and around her neighborhood is "unconscionable."

"This is a potential disaster waiting to happen in my opinion," Binder said.

Binder is talking about an orphan oil and gas well location near Route 7 and Havana Road in Adams County where weeds are growing, rust is accumulating, liquor bottles are on the ground, no emergency contact information is posted, and even a shed door housing essential equipment is wide open with no lock.

In July, the state cited the operator for several violations, including ones threatening the environment. But seven months later, the location remains in disarray.

The location is run by Tudex, a subsidiary of Tudor, an Energy Company based in Canada.

In September 2016, Tudex wrote a letter to shareholders saying it was closing.

"Tudex was pretty much unresponsive beginning in 2016," said Matt Lepore, the outgoing executive director of the Colorado Oil and Gas Conservation Commission, which is charged with regulating the industry in the state.

Lepore said Tudex left Colorado without much notice nor without much fear of consequence.

Tudex left without inspecting flow lines, without paying $1.6 million in fines, without reclaiming sites and without cleaning up cited violations.

For Lepore, the story of Tudex is a common one. The state has created a term for such activity: An orphan well.

Lepore estimates around 250 orphan wells exist in Colorado but there might be more.

"We suspect because of our historic operations in the state that there is a similar number that we haven't discovered," Lepore said.

Because the state is responsible for any orphan well, it is responsible for cleanup and reclamation. However, the state budget only allows for a few cleanups each year.

"We can do like 10 or 12 a year," Lepore said. "The cost to plug abandon, reclaim, clean up any spilled material averaged over a lot over a lot of years is $80,000."

Lepore also estimates the situation might only continue to get worse in the years to come.

"I worry about the number of future orphan wells," said Lepore, who will step down from his position on Friday.

"To me, the orphan well situation is a little like a hurricane sitting offshore and you know it's out there and you know it's coming ashore, you just don't  know if its going to be a tropical storm or a Category 5."

Lepore discussed several options for lawmakers to try to prevent oil and gas companies from leaving.

"The bonds need to be higher," Lepore said.

For instance, when Tudex started its operations in Colorado, it posted $120,000 in bonds as a security deposit.

When it left, the state took that money. Tudex owed the state $1.6 million in fines in 2017. Is $120,000 in bonds enough to get a company to do the right thing?

As for the Adams County location, Lepore said the Tudex locations, despite appearance and violations, pose no immediate safety risk to the public.

Lepore said the state has put a lock on the shed door housing equipment.

Finder hopes the state takes action soon.

"The state needs to come in an clean this up right away," Finder said.