An attempt by a Kiowa County rancher to increase the nearly $198,000 fine on an oil and gas operator who fouled his land and poisoned his herd was rejected Wednesday by the Colorado Energy and Carbon Management Commission.
In June 2021, Kevin Davis discovered a large oil spill on his land from a well operated by Western Operating Co. The fence around the site was partially down and cows and calves were wandering around the pad.
One cow was dead, oil coming out of its nose, and others were just lying around. The hiss of escaping gas filled the air. Six cows eventually died and Davis’ entire herd was suspected of being tainted.
As a result, the few cows from Davis’ K&T Cattle Co. that were sold after the spill went for a fraction of the market price, he said. In a good market a 7- to 8-year-old can sell for $2,100.
A total of 98 barrels of crude oil were released and that incident followed one on the Davis ranch in May 2021 when a Western Operating tank battery caught fire.
The Denver-based company operates 81 producing wells and 14 injection wells across six counties with concentrations in Logan and Kiowa counties and has incurred violations and fines at other sites.
In September 2022, the ECMC, formerly the Colorado Oil and Gas Conservation Commission, reached an agreement with Western Operating for a fine of $197,800 to settle four violations on the K&T ranch.
Davis petitioned the commission contending that the fine was too low, because, among other things, it relied on self-reporting by Western Operating while ignoring other evidence.
The ECMC, however, sided with the commission staff Wednesday and rejected K&T’s petition.
“I do recognize that the maximum potential penalties were not assessed in this matter,” commissioner Brett Ackerman said. “I do recognize that it’s not uncommon in enforcement contexts for there to be a potential range of actions and penalties available to the director depending on the circumstances.”
“It’s my opinion that there is not a clear error in judgment here by the director in the penalties that were assessed and support the order as previously issued.” Ackerman said. The four other commissioners agreed.
K&T and Western Operating have not come to an agreement on compensation and damages. K&T filed a lawsuit against the oil and gas operator.
“A civil case has been filed in state court and at this point it is pending and unresolved and heading down the tracks to trial,” Dietrich Hoefner, K&T’s attorney, told the commissioners.
A trial is expected to be held in Kiowa County District Court in April, Western Operating’s lawyer said.