NewsCovering Colorado


Oil and gas company north of Fort Collins ordered to cease operations following repeated violations

CDPHE cited concerns to “public welfare” as reason for cease-and-desist order
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Posted at 1:33 PM, Aug 26, 2022
and last updated 2023-11-07 19:31:02-05

DENVER – An oil and gas site north of Fort Collins was ordered by the Colorado Department of Public Health and Environment to cease operations Thursday over concerns to public health.

The CDPHE’s Air Pollution Control Division ordered Castle Rock-based Prospect Energy LLC to cease operations at its Krause site over concerns the site was creating “an unhealthy or disruptive environment” for nearby homes and businesses. The move comes after the division “exhausted other options to correct those violations, including initiating several enforcement actions,” according to a CDPHE spokesperson.

The site is close to at least one home and two other businesses, and inspections at the site had been ongoing since 2021 following odor complaints from nearby residents to the division.

Inspections at the Krause site revealed several violations, including the emission of volatile organic compounds (VOCs) from storage tanks, some which occurred because Prospect Energy failed to properly maintain its vapor lines, according to a news release from the CDPHE.

After the violations were recorded, Prospect Energy told inspectors it would follow Vapor Control System Guidelines, but the division found the oil and gas company failed to do so as emissions violations have continued since.

During a June visit, inspectors highlighted “a very rare occurrence” in which a division inspector’s monitor sounded an alarm for hydrogen sulfide, indicating potentially dangerous levels of gas.

Hydrogen sulfide is a common colorless gas that naturally occurs in oil and gas and smells like rotten eggs, the CDPHE said in its release. Short-term exposure to high levels of hydrogen sulfide can cause eye irritation, breathing difficulties, dizziness, and headaches.

After repeat inspections, the division found that Prospect Energy hasn’t taken the “necessary steps to fix violations related to its tanks and reduce odors related to hydrogen sulfide.”

In response to those violations, Prospect Energy submitted information to the division that indicates the Kraus site is not “properly designed, operated, or maintained,” a CDPHE spokesperson said.

“This is an exceptional and rare course of action, and we do not take it lightly,” said Michael Ogletree, director of the Air Pollution Control Division. “This is a unique situation that calls for extraordinary measures to ensure we are protecting public welfare.”

Division officials said not only has Prospect Energy failed to “fully establish proper design, operation, and maintenance elements to prevent illegal emissions” but that representatives also failed to attend compliance advisory meetings.

Division inspectors will continue monitoring the Krause site to make sure they are following the cease-and-desist order, the spokesperson said.

In late July, the U.S. Environmental Protection Agency (EPA) settled with a Colorado natural gas company for $3.2 million for allegedly violating federal and state clean air laws.