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September 22, 2015 10:54 AM UTC

Rural VFD Scrambles as Billionaire Driller Flares Wells & Funds Politicians

  • by: PKolbenschlag

(Promoted by Colorado Pols)

Methane is a greenhouse gas some 20 times more potent than carbon dioxide. It is a pollutant when released into the atmosphere, often a precursor to ozone, and is itself a volatile compound that may signal a threat of area toxicity depending what other compounds are present in the gas.

It is also, we are regularly reminded, a valuable commodity, harbinger of American ‘energy independence’ and of a manufacturing revolution, when piped and sold as natural gas.

Yet despite all this—the bad, the good, the ugly—methane, the primary component of natural gas, is regularly vented and flared in America’s oil and gas fields.

Even in the dark of night on remote Colorado mountain passes when maybe no one will notice.

But it was noticed, not once but twice, recently on McClure Pass, provoking a flurry of concerned and sometimes overblown comments on the local Facebook message board as motorists reported the incidents. In the most recent episode local fire fighters scrambled to the report of flames in the forest at a rig on a dark night.

The Grand Junction Daily Sentinel is reporting:

SG Interests flared a natural gas well in the upper North Fork Valley recently without notifying local authorities, reportedly requiring an unnecessary visit to the somewhat remote location by local firefighters.

Companies are required to notify authorities of flaring under state rules, and SG says it is taking steps to prevent a repeat violation.

Paonia resident Pete Kolbenschlag, who works as a consultant on environmental issues, says he hopes so. He fears a succession of false alarms could lead to emergency agencies with limited resources being less apt to quickly respond to an incident like a true well fire or a spill of pollutants into waterways.

“There’s a reason why there’s a notification requirement,” he said.

The flaring occurred earlier this month near Colorado Highway 133 southwest of McClure Pass in Gunnison County.

Venting and flaring releases volatile and harmful compounds, and can include flames several stories tall, both bothersome things to come across driving over a mountain pass in the National Forest.  

SG Interests—operator of the gassy, flaring well—is one of two oil and gas companies that are most active in the upper North Fork Valley. The other is Bill Koch’s Gunnison Energy Company. In the earlier July incident the motorist reported strong smells.

I was driving on Route 133, towards Paonia, on July 3, 2015. It was 11:15 AM, on that Friday, as I was driving down McClure’s Pass, after mile Marker 40, that I was assaulted by the most extreme and dense vapors/gas from a chemical source.

It was so extreme, that I thought I might pass out. It lasted for several minutes at the very extreme level and then as I drove further away, the fumes left my truck’s cab. On the right of my truck, at the moment I first smelled the heavy chemical fumes, I saw liquid rushing down the mountainside. This liquid ran down the mountainside and down a ditch along the side of the highway. This liquid may or may not have been the source of the chemical fumes.

There are 2 active gas well sites and companies operating in the vicinity of my exposure to the chemical vapors. The first company is SG Interests and the second company is Gunnison Energy. Route 133, mile marker 39-40, west of McClure’s Pass, outside of Marble, Colorado and before Paonia, Colorado.

The Colorado Oil and Gas Conservation Commission complaint on file for that incident notes that inspectors did not find anything amiss when they got around to inspecting the well a few days later.

I Spoke with Thane Stranathan with BLM (Montrose) on phone today. He met with complainant on location and said he could find no fault with SG and the water flow was above location and caused by mudslide under CDOT control and they were aware of it. We plan to meet next week and visit site.

Both GEC and SGI are privately held billionaire-owned companies. Texan Russ Gordy being the primary name behind SGI. Just last week the US Forest Service and Bureau of Land Management gave these two companies the go ahead to develop 16 new wells north of Paonia Reservoir State Park. Colorado Park and Wildlife concerns regarding their location within elk winter concentration areas were mostly dismissed.

It was these two companies that together built the Bull Mountain pipeline, which was itself the cause of a losing (for the roadless forests and impacted wildlife) environmental battle about eight years ago. GEC and SGI have an uneasy relationship, sometimes in conflict other times in collusion according to the U.S. Justice Department.

Another Gunnison Energy Company project for up to 150 wells is currently under agency review (Bull Mountain Master Development Plan). And SG Interests is currently trying to acquire additional lands in the North Fork via legislation while attempting to drill on the other side of the pass, within the Thompson Divide area, threatening to take its heavy industrial traffic right through Glenwood Springs and up Four Mile Road against everyone’s objections.

Perhaps due to its often blunt tactics SGI has been investing heavily in the politics of the geography it hopes to drill. It is rumored to give hefty 4 figure contributions to small town Chambers of Commerce. SGI is the local congressman’s number one donor and he SGI’s number one recipient. Senator Cory Gardner also being among its top recipients of campaign cash. So far in just 2015 SGI has spent over $220,000 on high-priced DC lobbyists.

Meanwhile little towns like Paonia continue to struggle under a slow economy. We take pride in our ability to get by, in simple things like a champion football team, and in knowing that our volunteer based first-responders stand ready to go on a moment’s notice.

But small towns ought not be burdened by the industrial exploits of billionaires no matter how much cash they spread around to DC politicians and top dollar lobby shops.

Colorado Oil and Gas Conservation Commission rules require that companies doing flaring notify local emergency dispatchers or an area’s local oil and gas government designee. The notification is required ahead of time when the flaring is reasonably anticipated, and in all cases no later than two hours after it occurs.

Eric Sanford of SG Interests said the recent flaring was done for safety reasons during workover operations.

“SG acknowledges our failure in this instance to properly notify local emergency services as required. SG is setting internal processes to ensure such notifications are properly and timely made for future operations requiring flaring,” Sanford said in an e-mail.

He said SG also flared the well in July during completion work on the well, and in that instance SG made the required notifications.

Kolbenschlag said firefighters had to respond from Paonia to check on this month’s flaring activity. Representatives of Paonia’s volunteer fire department could not immediately be reached for comment.

The incident arises as SG and others pursue approvals to do more drilling in the upper North Fork Valley, including an SG project for nearly 150 wells in the Bull Mountain area.

Gunnison County Sheriff Rick Besecker said his department hasn’t had much interaction so far with the industry. He said he does have concerns about the potential for accidents on-site, or drilling-related activities resulting in something like a forest fire or contamination of waterways.

“It’s a public-safety concern, whether it’s an industrial accident or if it could create a circumstance where it starts a major incident that will eventually impact a community,” Besecker said.

As the Sentinel article correctly highlights, following the notification requirements is one solution to helping avoid unnecessary response from local emergency personnel. The better one is to reduce or eliminate flaring.

Flaring is a dirty, ugly, and wasteful practice. When it happens on wells that are tapping publicly owned minerals, like from public lands, then it is a material loss of our shared energy resources with a financial harm to the American taxpayer.

In this case Americans pay on both ends, and our resources are burdened when companies neglect to do their job. It is good that SGI acknowledges its fault. SGI is correct that it should be more careful to avoid another violation.

But more to the point, SGI should work diligently to reduce flaring and methane leaks and wastage at all its operations. And state and federal agencies need to step up monitoring and inspections and much more rigorously enforce their rules. And while Colorado has implemented state-based rules around methane flaring and venting, federal rules need to catch up to ensure that SGI and every energy company is acting to reduce and eliminate flaring and venting at their wells. It may cost a couple of billionaires a few more bucks, but it saves the rest of us time, resources, and money.

Plus it helps the planet too.


9 thoughts on “Rural VFD Scrambles as Billionaire Driller Flares Wells & Funds Politicians

  1. Why do flare-offs occur?

    I'm unfamiliar enough with the mechanics of oil and gas extraction to want to know.

    It seems like a routine flare-off should never occur unless, that is, the infrastructure to contain it doesn't exist. I could well believe that this infrastructure is lacking because it isn't cost effective.

    I could imagine conditions where, due to unanticipated drilling conditions or mechanical failure, flare-offs become necessary as an emergency safety measure.

    1. In drilling operations, natural gas is a can't usually be piped away, in a new field particularly. It is dangerous to let it accumulate, so burning it off is a cheap and easy way to handle the problem.

      1. Thank you, Duke.

        So is it correct to say that during normal drilling operations flare-offs are a routine safety measure?

        Does there exist technology that would capture this gas? I'm thinking of the type of mechanism that drillers use to prevent oil gushers, applied to gas handling.

        Why is it that flare-offs occur more frequently in new oil fields?

        Once a well is established and producing, what happens to the gas? Is is collected and stored or transported as a separate component from the oil?

        Are flare-offs a normal or an exceptional occurrence in the operation of a producing well?

        For that matter, can a well produce both commercial oil and gas at the same time?

  2. I'm still puzzled. Gas is money. I'm surprised they'd burn off profits that way. I also wonder if any of these flares ever get loose and touch off forest fires.

  3. Wells can produce both.  Flaring happens more often during well completion, but it can happen all the time.  Yes, companies can capture it.  If they did they would have to pay Americans for it.  So rather than collecting it, or piping it, and getting $3.00 / mcf and having to pay Americans royalties  taking their publicly owned minerals, they vent and flare it.  It saves them money everything considered and nothing, nothing, nothing at all is more valuable than money.  


    Out-of-state interests write the Thompson Divide SGI exchange playbook for Scott Tipton

    When it comes to the plan to exchange oil and gas leases in Colorado’s Thompson Divide region, nearly all the players—industry, communities, and officials—are in sharp agreement: It’s time to set some areas of the area aside to protect the outdoor economy. Everyone, that is except for Rep. Scott Tipton and his backers in the fossil energy industry, who have long expressed a desire to develop the area. 

    Rep. Tipton is making that he opposes a balanced approach to managing energy develop on public lands in the region.  This should come as no surprise to anyone who news to anyone with access to campaign finance laws, which is all of us. 

  5. SG Interests has at least one Colorado politician in its pocket


    Mr. Tipton, the Republican congressman for western Colorado, left out some important information in his recent guest column urging that local communities give Texas oil and gas company SG Interests everything it wants without any reciprocal offering – such as specifically protecting other cherished and heavily utilized critical public lands in the area.

    For one, Tipton’s column neglected to even mention that the two most impacted counties, via the Delta and Gunnison Board of County Commissioners, have both called on the Congressional delegation to make sure that any legislation is a win for all the communities, on both sides of McClure Pass. The makeup of those boards is 4 Republicans and 2 Democrats, with the Delta BOCC being all Republican. That the local counties are asking for exactly what Tipton says he is unwilling to consider should warrant a mention, even if in an attempt to deflect it. That is unless Tipton is more interested in pushing a certain agenda rather than in fairly representing this issue or accurately portraying where his constituents are on the matter.

    Which gets to the other missing information of which Sentinel readers ought to be aware. SG Interests, a privately held oil and gas company owned by a billionaire is Tipton’s single largest campaign contributor, according For his part, Tipton is Texas-based SG Interests’ top recipient of campaign largess. In 2015, SG Interests has already spent almost a quarter of a million dollars on high-priced DC lobbyists trying to grease the Congressional skids to get its way with western Colorado. And whether it is successful or not remains to be seen, but it does look from all appearance that SGI does at least already have one Colorado politician in its pocket.


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