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Backup Documents 05/13/2014 Item #12A \at . 12A STATE OF FLORIDA RECEIVED DEPARTMENT OF ENVIRONMENTAL PROTECTION May 12, 2014 COLLIER COUNTY, Dept.of Environmental Protection Petitioner, and Office of General Counsel CONSERVANCY OF SW FLORIDA, INC. Intervenor, DOAH Case No. DEP OGC FILE NO. 14-0012 v. DEP CONSENT ORDER Drilling Permit No. 1349H Collier Hogan Well 20-3H Collier County, Florida DEPARTMENT OF ENVIRONMENTAL PROTECTION, DAN A. HUGHES COMPANY, L.P. Respondents. DRAFT CONSERVANCY OF SW FLORIDA, INC.'s VERIFIED PETITION CONSERVANCY OF SW FLORIDA, INC. files this verified petition to intervene in support of COLLIER COUNTY's Petition for Formal Administrative Hearing regarding the above referenced DEP Consent Order DEP OGC FILE NO. 14- 0012 DAN A. HUGHES COMPANY, L.P., Drilling Permit No. 1349H Collier Hogan Well 20-3H dated on or about April 8, 2014. 1. Intervenor CONSERVANCY OF SW FLORIDA, INC. ("CONSERVANCY") is a Florida Not for Profit Corporation doing business in Collier County Florida, with a mailing address at 1450 Merrihue Drive Naples Florida 34102. CONSERVANCY OF SW FLORIDA, INC. is represented for purposes of this proceeding by Ralf Brookes Attorney (239) 910-5464, Ralf@Ralf13rookesAttorney.com 1217 E Cape Coral Parkway#107, Cape Coral Fl 33904 fax(866)341-6086. 1 12A 2. Intervenor received a press release discussing the Consent Order in a press release issued by the DEP titled "Statement from DEP Regarding Consent Order with the Dan A. Hughes Company, I,.P"that was received on or about April 19, 2014. 3. The CONSERVANCY's corporate purpose is: "The corporate purpose of the Conservancy includes the protection of the natural environment of Southwest Florida through environmental advocacy, education and scientific research. The mission of the Conservancy is "protecting Southwest Florida's unique natural environment and quality of life...now and forever." 4. The CONSERVANCY has maintained a presence in Collier County appearing at DEP meetings and Board of County Commissioners meetings concerning the Oil Wells in the area. 5. The CONSERVANCY maintains physical offices, as well as wildlife rehabilitation and nature centers, located in Collier County. The CONSERVANCY it is the named "grantee" on numerous conservation easements on real property located in Collier County. 6. The CONSERVANCY publishes an online and printed newsletter, which is distributed in Collier County, with information about its activities including its involvement in environmental permitting, environmental education, research, habitat protection and fundraising activities held in Collier County. 7. The CONSERVANCY has a Collier County business tax receipt (formerly called an "occupational license") for the business purpose of monitoring environmental, growth management and habitat protection in Collier County, Florida. 8. The CONSERVANCY was originally incorporated in 1966 and now has over 5,199 members. 2 1. 2 A 9. The CONSERVANCY substantial interests will be substantially affected because a substantial number of its members live near, use or benefit from water resources that have been and will be affected by the failure to comply with all DEP requirements for oil wells and violations of those requirements that fail to adequately protect the air, water and natural resources of Collier County. 10. The CONSERVANCY asserts standing to intervene in this proceeding originally filed by COLLIER COUNTY pursuant to Chapter 120, Florida Statutes and Section 403.412(5), which states: "(5) In any administrative, licensing, or other proceedings authorized by law for the protection of the air, water, or other natural resources of the state from pollution, impairment, or destruction, the Department of Legal Affairs, a political subdivision or municipality of the state, or a citizen of the state shall have standing to intervene as a party on the filing of a verified pleading asserting that the activity, conduct, or product to be licensed or permitted has or will have the effect of impairing, polluting, or otherwise injuring the air, water, or other natural resources of the state. As used in this section and as it relates to citizens, the term "intervene" means to join an ongoing s. 120.569 or s.120.57 proceeding." The activity or conduct allowed under the Consent Order will have the effect of impairing, polluting, or otherwise injuring the water and other natural resources of the state as set forth in Florida Statutes, Section 403.412(5). See Verification, attached. 11. The agency that reviewed the violations and issued the Consent Order affected by this Petition is the FLORIDA DEPARTMENT OF ENVIRONMENTAL PROTECTION("Department"or"DEP"). The Department's main address is Mail.Station 35 3900 Commonwealth Boulevard, Tallahassee, Florida 32399 and the DEP local district office address is 2295 Victoria Avenue, Suite 364, Fort Myers, Florida 33901. The Department's identification number for this matter is DEP OGC FILE NO. 14-0012, DEP CONSENT ORDER regarding DEP Drilling Permit No. 1349H Collier Hogan Well 20-3H.The subject matter and activity are impacts are located within Collier County, Florida. 3 J l DISPUTED ISSUES OF FACT WARRANTING MODIFICATION OR REVERSAL OF PERMIT 12. The CONSERVANCY adopts the Petition filed by COLLIER COUNTY. including all disputed issues of fact and law warranting modification or reversal of the Consent Order. 13. Without prior approval of the DEP, Dan A Hughes commenced a workover operation on 12/30/13. On 12/31/13 the DEP issued a cease and desist on the company. The company continued the workover operations until 1/1/14 2:30 pm without prior approval by DEP. 14. The workover operation used an enhanced extraction procedure that had not previously been used in Florida. The company proposed to inject a dissolving solution at sufficient pressure to achieve some openings in the oil bearing rock formation that would be propped open with sand. 15. Hughes failed to provide reasonable assurances prior to entry of the Consent Order because Hughes had not provided Material Safety Data Sheets (MSDS) for all materials used in the Workover Operation and the proportion and total volume of each material used in the Workovcr Operation. 16. Hughes failed to provide reasonable assurances prior to entry of the Consent Order because Hughes had not identified the total volume of water used in the Workover Operation,the source of the water, including the permit number if the water was obtained from a permitted source and confirmation that the volume of water used for the Workover Operation does not exceed any limitation set in the permit. 17. Hughes failed to provide reasonable assurances prior to entry of the Consent Order because Hughes had not provided information concerning the flowback material management for the Well operations: (a) estimate of the total volume of 4 J 12A flowback material; (b) storage capacity at the pad to contain any flowback material that is anticipated to be held onsite; (c) description of the secondary containment measures employed at the site; (d) the final disposal location for the flowback material resulting from the Workover Operation; and (e) and confirmation of the regulatory conditions on final disposal, including the permitting agency and permit number(s). 18. Hughes failed to provide reasonable assurances prior to entry of the Consent Order because Hughes had not provided an Interim Spill Prevention and Cleanup Plan ("ISPC Plan") and based on aerial photographs spills of oil and other liquids and chemicals have occurred at the site. 19. Hughes failed to provide reasonable assurances prior to entry of the Consent Order that injected or native fluids have not migrated through the deep geological formations or nearby abandoned but unplugged wells into surrounding groundwater bearing zones with total dissolved solids concentrations of 10,000 ppm or less. 20 Based upon information provided to the public, the violator has failed to provide reasonable assurances that the conduct or activity addressed by the consent order meets all applicable statutes and regulations of the state of Florida, including groundwater standards. 21. The Consent Order is insufficient, incomplete and inadequate to provide reasonable assurances that the activity and conduct permitted by the proposed Consent Order meets all statutes and regulations of the state of Florida including Oil and Gas Rules FAC i52('- 20.006 (Workover Operations). 62C-29.009 (Plugging and Abandonment of Wells), 62('- 2`.1)04 (Production and Production Facilities); and 62('-28.005 (Notification) and applicable groundwater assessment,remediation, and groundwater standards. 5 SPECIFIC STATUTES & RULES WARRANTING MODIFICATION OR REVERSAL 22. The Consent Order therefore fails to provide reasonable assurances required under Florida Statutes Chapter 377, Part I (Regulation of Oil and Gas Resources), Florida Statutes Chapter 403 (Environmental Control); Florida Administrative Code 62C-29.006 (Workover Operations). Florida Administrative Code 62C-29.009(Plugging and Abandonment of Wells), Florida Administrative Code 62C-28.004 (Production and Production Facilities); Florida Administrative Code 62C-28.005 (Notification)and any applicable groundwater assessment,remediation, and groundwater standards. RELIEF SOUGHT IN THIS PROCEEDING: Petitioners respectfully request to intervene in the formal DOAH Administrative Hearing on the disputed issues of fact and law and that the DOAH AU enter a Recommended Order recommending modification (or denial) of the consent order, and that DEP issue a Final Order be issued revoking DEP Drilling Permit No. 1349H Collier Hogan Well 20- 3H. • 6 12A 41 VERIFICATION AFFIDAVIT STATE OF FLORIDA COUNTY OF COLLIER Under penalties of perjury, I declare that the following is true based upon my personal knowledge: Under Florida Statute 403.412(5) I, ireS/a/ M on behalf of the CONSERVANCY OF SW FLORIDA, INC. have read the Consent Order dated April 8, 2014 and hereby assert that "the activity and conduct to be permitted has or will have the effect of impairing, polluting, or otherwise injuring the water and natural resources of the state" as set forth in Florida Statutes, Section 403.41). C SERVANCY OF SW FLORIDA, INC. By e praj- A rZO NOTARY PUBLIC As sworn and subscribed before me this I2 day of Hay , 2014 by Rai, [aunt] who is either personally known to me or produced Identification ,Type of Identification Produced By:_ I"16v%EA Notary Public [notary stamp] State of Florida County of COLLIER 4 a"' a,,� MARGARET ANN DARDIS Notary Pub 4c-State of fbrids 4 ' My Comm.Enke.Nov 12,2017 ' �. Commission•ff 48794 I Bonded Though Mond Wary Assn. 7 Certificate of Service I certify that the foregoing petition requesting a formal administrative hearing has been electronically filed and served this Monday May 12, 2014 by email as follows: DEPARTMENT OF ENVIRONMENTAL PROTECTION (agency): Department of Environmental Protection Agency Clerk Lea Crandall Filed as PDF: Lea.crandall @dep.state.fl.us Fred Aschauer, Esq. Fred.Aschaueradep.state.fl.us DAN A. HUGHES COMPANY. L.P. (applicant): Timothy Riley Esq. TimothyR @hgslaw.com COLLIER COUNTY(petitioner) Jeffrey A. Klatzkow, County Attorney, jeffreykl atzkow(d col1iergov.net Respectfully submitted, Ralf Brookes Attorney ATTORNEY FOR CONSERVANCY OF SW FLORIDA, INC. Fla Bar No. 0778362 1217 E Cape Coral Parkway#107 Cape Coral, Fl 33904 Phone(239)910-5464 (866) 341-6086 fax RalfBrookes(i4gmail.com ralf(iiralfbrookesattorncy.com 8 H2O GeoSolutions LLC 1 2 A May 12, 2014 Ms. Jennifer Hecker Director of Natural Resource Policy Conservancy of Southwest Florida 1450 Merrihue Drive Naples, Florida 34102 Subject: Recommendations for Modification of Consent Order 14-0012 between FDEP and Dan A. Hughes Company Dear Ms. Hecker: H2O GeoSolutions LLC (H2O) has reviewed the above referenced consent order and available pertinent data from the Florida Department of Environmental Protection (FDEP) Oil and Gas application files. It is clear from the records that there is a strong potential for existing and future contamination of groundwater, including within aquifers that lie above the Underground Source of Drinking Water (USDW) and possibly into the surficial aquifer system (SAS) as a result of unauthorized actions performed on the Collier Hogan 20-3H located on the Hogan Island Farm in Collier County Florida. FDEP consent order No. 14-0012 states that unauthorized actions were performed at this well from December 30, 2013 through January 1, 2014. There is a high potential for migration of injected fluids from Collier-Hogan 20-3H of an unknown composition into two (2) existing dry-hole (abandoned oil exploration) wells drilled in the late 1940s. These wells, referred to as 86 (H.O.R.C. C-1 GCR) and 103 (Humble E-1 GCR) lie approximately 200 feet south of the horizontal portion of the Collier-Hogan 20-3H well and approximately 2,500 feet west-southwest of the main well bore, respectively. FDEP records indicate that these dry-hole wells were never properly plugged and abandoned to prevent migration of groundwater between aquifers through the boreholes, and are likely extremely degraded and rusted steel casing that were installed over 65 years ago. These proximal wells provide vertical hydraulic conduits into groundwater above the hydrocarbon recovery zones and into aquifers that lie above the USDW and possibly into the SAS. The unauthorized activities that were performed on the Collier-Hogan 20-3H well may have introduced contaminants into any number of potential flow zones within the strata intercepted by either the well borehole, the dry-hole wells, or the permitted onsite Class II disposal well if it were used for disposal of waste from the unauthorized activities. The existing hydraulic gradient, which drives both surface and groundwater from uplands in the northeast toward the southwest and the Gulf of Mexico, has a potential to entrain contaminants from the Collier Hogan 20-3H well site and carry them down-gradient. '`: Ms. Jennifer Hecker May 12, 2014 Recommendations Consent Order 14-0012 Page 2 of 3 Currently injected fluids that may have migrated into the portions of the dry-hole wells likely have minimal hydraulic drive to further migrate vertically. However, should further hydraulic pressure be applied to the hydrocarbon recovery zone prior to proper remediation, plugging and abandonment of the dry hole wells, the potential for vertical migration increases drastically. The following are bullet point suggestions for improvements and refinements to the Florida Department of Environmental Protection (FDEP) Consent Order 14-0012 to address these critical environmental impact concerns. To maintain the FDEP permit (Permit No: 1349H, Collier-Hogan 20-3H Well) with major modifications, the following actions are recommended the for Collier-Hogan 20-3H well. • A mechanical integrity test of the well casing should be performed to determine if the casing has been compromised by the Workover Operation. This would involve pressure testing according to best industry standards and practices. • Cement bond logs should be performed on the casing to determine if the Workover Operation caused damage to the annular cement • Radioactive tracer surveys should be performed to determine if there is upward movement of fluid outside of the casing. • If any onsite or off-site Class II injection well has been constructed and was used for disposal of the flowback water related to the unauthorized activities, then that well should be evaluated for mechanical integrity. The following concerns warrant further recommendations or modifications to the existing permit: • The monitoring well proposed in the consent order for the Sandstone Aquifer would not detect upward migration of contaminants until overlying aquifers were already contaminated. Monitoring wells placed in the deeper Upper Floridan aquifer would better detect upward migrating contamination prior to entering aquifers used for water supply purposes. Multiple series of nested monitoring wells should be placed in all aquifers above the USDW from the upper portions of the Floridan aquifer system to the surficial aquifer (to include Upper Floridan, Lower Hawthorn, Mid-Hawthorn, Sandstone, Lower Tamiami and surficial aquifers) proximal to the Hogan-Collier 20-3H well, at sound locations to detect any and all potential locations of contaminates both horizontally and vertically to accurately delineate contamination. • Perform clear and concise solute transport and groundwater flow modeling to simulate full projected impacts of fracturing and hydrocarbon extraction at the Hogan-Collier 20- 5H well with full peer-review. H2O GeoSolutions LLC 0 1905 SW 13th Lane,Cape Coral,Florida 33991 (239) 220-1796,NKugler @H20GeoSolutions.com F Ms. Jennifer Hecker May 12, 2014 2 A Recommendations Consent Order 14-0012 Page 3 of 3 • Perform tracer dye testing between the Collier-Hogan 20-3H well and dry-hole wells 86 (H.O.R.C. C-1 GCR) and 103 (Humble E-1 GCR) with FDEP and Collier County licensed professional geologists present during testing. • Provide FDEP and Collier County with the operational plan to be followed, including injection pressures, chemicals to be injected and supporting calculations, prior to use of any acid mixtures for stimulation. The operational plan should demonstrate that the proposed volumes and concentrations of stimulation mixtures are appropriate to treat the near-bore environment without excessive dissolution of surrounding rocks or forcing of active fluids deeper than necessary into the target reservoir. • Provide FDEP and Collier County a report with full chemical analysis on all spent recovered water that will be injected into any and all Class II injection wells in the State of Florida to monitor the pH and other unknown factors that may contribute to dissolution of any and all carbonate formations. The water should ideally be neutralized prior to injection into any Class II injection well in the State of Florida to minimize the potential for dissolution of carbonate formations and possible collapse or sinkhole formation. • Clearly locate, identify, thoroughly investigate and properly plug & abandon dry-hole wells 86 (H.O.R.C. C-1 GCR) and 103 (Humble E-1 GCR) with FDEP and county licensed professional geologists present during all aspects of the testing and plugging. Finally, there is a high risk for potential migration of any contaminants introduced at the Collier-Hogan 20-3H well site toward down-gradient areas of existing private wells, Orangetree Utility wells and the proposed Northeast Collier County brackish water wellfield. These wells, wellfields and any other current or future water sources should be considered during analysis of chemical migration during the recommended solute transport modeling analysis. Tracer-dye testing should include any and all current and future potential sources of drinking water, ideally by utilizing existing or proposed monitoring wells located in the areas where groundwater transport of chemicals may occur to verify solute transport modeling assumptions and coefficients. If these conditions aren't met the permit should be revoked due to an unacceptably high risk for contamination of groundwater within aquifers above the USDW and potentially into the surface water environment. Respectfully, Noah B. Kugler, P.G. 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