ARKANSAS OIL AND GAS COMMISSION

Transcription

1 Director s Office: 301 Natural Resources Drive Suite 102 Little Rock, AR Phone: (501) Fax: (501) ARKANSAS OIL AND GAS COMMISSION Mike Beebe Governor Lawrence Bengal Director El Dorado Regional Office: 2215 West Hillsboro El Dorado, AR71730 Phone: (870) FAX: (870) Fort Smith Regional Office: 3309 Phoenix Avenue Fort Smith, AR72903 Phone: (479) FAX: (479) March 15, 2012 Arkansas Oil and Gas Commission 301 Natural Resources Drive, Suite 102 Little Rock, AR RE: Docket 072A Ten High Gas Company, Inc. Request for Amendment to Order No. 363A Permit # Paul Erb #1 Well Sec. 26 T16N R33W Wedington Field Washington County, Arkansas Dear Commissioners: Corrected Order No. 363A ( 363A ) was issued on July 1, 2008, whereby the Arkansas Oil and Gas Commission ( AOGC or Commission ) ordered the plugging and abandonment of five (5) wells operated by Ten High Gas Company, Inc. for failure to produce in violation of AOGC General Rule G-1. One of the wells identified in 363A was the Paul Erb #1, located in Section 26, Township 16 North, Range 33 West, Washington County, Arkansas. On or around March 1, 2012, the AOGC-Fort Smith Regional Office mailed notices to parties having interests in wells identified in 363A that staff and/or an agent thereof would be coming onto the properties to plug and abandon the identified wells. Mr. Darin Stancomb, who utilizes the Paul Erb #1 well as a domestic well, received such notice and contacted the AGOC-Little Rock office. Upon review by AOGC staff, the following was established: (1) On August 25, 2004, an was sent from former AOGC employee Jon Harris to AOGC Assistant Director Gary Looney regarding the status of fifty-three (53) wells in North Arkansas operated by Ten High Gas Company, Inc. Of those, Mr. Harris identified seven (7) that had been or were to be transferred to landowners. The Paul Erb #1 was identified as one of the seven wells to be transferred. Exhibit A. (2) On August 31, 2004, Mr. Looney responded via acknowledging and approving the transfer of all of the seven wells, except the Paul Erb #1, due to failure by the transferee to provide proof of financial assurance. Exhibit A. (3) On October 8, 2004, the AOGC stamped as received proof of financial assurance from Mr. Stancomb, or a party acting on his behalf, in the form of a Letter of Credit in the amount of $1,500.00, held by Arvest Bank in Siloam Springs, Arkansas and effective as of September 1, Exhibit B. COMMISSION MEMBERS Chad White, Chairman, Magnolia W. Frank Morledge, Vice-Chairman, Forrest City Charles Wohlford, Fort Smith Mike Davis, Magnolia William L. Dawkins, Jr., Fort Smith Jerry Langley, Smackover Chris Weiser, Magnolia Jim Phillips, Smackover George Carder, Searcy An equal opportunity employer

2 Upon review of the above-referenced documents and in the absence of any documentary evidence to the contrary, the AOGC staff concludes that the Paul Erb #1 well was incorrectly listed as a well to be plugged and abandoned in Order No. 363A Therefore, Staff requests that the Commission amend Order No. 363A and remove the Paul Erb #1 well from the list of Ten High wells to be plugged and abandoned. Sincerely, Lawrence E. Bengal Director

3 Director s Office: 301 Natural Resources Drive Suite 102 Little Rock, AR Phone: (501) Fax: (501) ARKANSAS OIL AND GAS COMMISSION Mike Beebe Governor Lawrence Bengal Director El Dorado Regional Office: 2215 West Hillsboro El Dorado, AR Phone: (870) FAX: (870) Fort Smith Regional Office: 3309 Phoenix Avenue Fort Smith, AR Phone: (479) FAX: (479) A LIST OF EXHIBITS Exhibit A Exhibit B Exhibit C Exhibit D Exhibit E Exhibit F Internal AOGC Electronic Correspondence D. Stancomb Letter of Credit AOGC Order No. 363A (Corrected) Notice of Hearing Affidavit of Service Proof of Publication COMMISSION MEMBERS Chad White, Chairman, Magnolia W. Frank Morledge, Vice-Chairman, Forrest City Charles Wohlford, Fort Smith Mike Davis, Magnolia William L. Dawkins, Jr., Fort Smith Jerry Langley, Smackover Chris Weiser, Magnolia Jim Phillips, Smackover George Carder, Searcy An equal opportunity employer

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8 C-O-R-R-E-C-T-E-D ARKANSAS OIL AND GAS COMMISSION 301 NATURAL RESOURCES DRIVE SUITE 102 LITTLE ROCK, ARKANSAS ORDER NO. 363A (Corrected) July 01, 2008 WELL ABANDONMENT WELL ABANDONMENT Washington and Benton Counties, Arkansas After due notice and public hearing in Little Rock, Arkansas, on June 25, 2008, the Arkansas Oil and Gas Commission, in order to prevent waste, carry out an orderly program of development and protect the correlative rights of each owner in the common source(s) of supply, has found the following facts and issued the following Order. Original Order No. 363A incorrectly stated the legal location for some of the wells to be abandoned. The legal locations were correctly identified in both the Application and Notice to Interested Parties. This Corrected Order No. 363A is issued with the same effective date of July 1, 2008, and supersedes and replaces Original Order No. 363A in its entirety. FINDINGS OF FACT From the evidence introduced at said hearing, the Commission finds: 1. That the well(s) or well site locations which are subject to the Order below are all remaining unplugged wells formerly operated by Ten High Gas Company Inc., located in Washington and Benton County, including, but not limited to: Name Well No. Location Luther, Henry #1 Sec. 13-T16N-R33W ERB, Paul #1 Sec. 26-T16N-R33W McDonnell, John #1 Sec. 1-T14N-R32W Hudson #1 Sec. 31-T15N-R31W Roche, James #1 Sec. 31-T15N-R31W 2. That the last operator of record for the well(s) enumerated in Finding 1 EXHIBIT C

9 ORDER NO. 363A (Corrected) July 01, 2008 Page 2 of 3 above, is TEN HIGH Gas Company, Inc. (hereinafter referred to as TEN HIGH ). 3. That the last known address for TEN HIGH Gas Company, Inc., as listed with the Arkansas Oil and Gas Commission is: P.O. Box 676, Gravette, AR That TEN HIGH has failed to maintain compliance with the rules and regulations of the Arkansas Oil and Gas Commission. 5. That the wells enumerated in Finding No. 1 above have failed to produce gas for in excess of 2 years. 6. That notice was published in a newspaper of general circulation in Benton and Washington Counties. 7. That notice of the hearing was sent to TEN HIGH via U.S. Postal Service First Class Mail, postage prepaid. 8. That no agent or representative of TEN HIGH presented themselves at the hearing. 9. That the well(s) or well site locations enumerated in Finding 1 have been abandoned by their operator, TEN HIGH. CONCLUSIONS OF LAW 1. That due notice of public hearing was given as required by law and that this Commission has jurisdiction over said parties and the matter herein considered. 2. That this Commission has authority to grant said petition under the provisions of Arkansas Code Annotated , , and ORDER It is, therefore, ordered by the Commission: 1. The well sites identified in Finding No. 1 be declared abandoned and be plugged or re-plugged and surface conditions surrounding the well sites be restored in accordance with General Rule G-1 and Arkansas Code Annotated , , and However, in lieu of plugging the wells, the Director of Production and Conservation shall have authority to transfer the wells to another operator in accordance with all applicable Commission rules, including General Rule G-3. EXHIBIT C

10 ORDER NO. 363A (Corrected) July 01, 2008 Page 3 of 3 This Order shall be effective from and after July 01, 2008; and the Commission shall have continuing jurisdiction for the purposes of enforcement, and/or modifications or amendments to the provisions of this Order. ARKANSAS OIL AND GAS COMMISSION It is so Ordered by the Commission: Chad White, Chairman W. Frank Morledge, Vice-Chairman Bill Poynter Charles Wohlford Mike Davis Ken Williams Carolyn Pollan William L. Dawkins Jerry Langley Lawrence E. Bengal, Director of Production and Conservation EXHIBIT C

11 NOTICE OF HEARING The Arkansas Oil and Gas Commission will conduct its monthly hearing beginning at 9:00 a.m. on March 27, 2012 and thereafter at Arkansas Game and Fish Commission, Commission Hearing Room, #2 Natural Resources Drive, Little Rock, Arkansas Due to the length of some docket items, the hearing may continue into the following day. The AOGC will hear Docket No. 072A , the application of Staff requesting an amendment to Order No. 363A (Corrected) as it applies to the Paul Erb #1 well in Sec. 26 T16N R33W, Washington County, Arkansas. This docket is brought under the authority of Ark. Code Ann and Any parties who propose to oppose a filed application, shall notify, in writing, or via e- mail at objections@aogc.state.ar.us, the Hearing Officer or Director of the Arkansas Oil and Gas Commission, no later than close of business on Friday, March 23, ARKANSAS OIL AND GAS COMMISSION Lawrence E. Bengal Director EXHIBIT D

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