Denver, CO (Nov. 26, 2024) - The Energy and Carbon Management Commission (ECMC) announced today at a public hearing that two environmental consultants hired by oil and gas operators submitted falsified laboratory data reports to ECMC.
ECMC has preliminarily determined that the data manipulation affected soil, groundwater, and inorganic and organic contaminant data for approximately 350 oil and gas locations in Weld County. The identified data falsification occurred between 2021 and summer 2024.
ECMC is working diligently to mitigate the falsified data’s potential impacts to the environment, namely to soil and in limited cases to shallow groundwater. ECMC is working to ensure that all sites affected by the falsified data are properly sampled, investigated, and remediated, including using protocols such as split sampling and independent analysis as appropriate. Based on its preliminary investigation ECMC is confident that the falsified data created no new risks to public health. ECMC has also put in place additional safeguards to prevent falsified data from being submitted in the future, including requiring additional documentation and examining metadata.
Specifically, ECMC determined that the falsified data impacts reports submitted on Site Investigation and Remediation Workplans. Site Investigation and Remediation Workplans cover both the closure of oil and gas facilities and the clean up or remediation of spills. The closure phase of an oil and gas operation begins after production ends and is not considered complete until ECMC has received documentation from the operator that the site meets the state's cleanup standards. During this phase, ECMC requires a thorough investigation of the entire facility and its infrastructure to determine if a spill occurred within the lifespan of the site. A spill is when an unintended release of exploration and production waste (E&P Waste) occurs and requires remediation. ECMC’s protective thresholds for both spill reporting and clean up are the most protective in the nation. In total, operators are conducting investigation or cleaning up spills at approximately 4,700 sites in Weld County.
Oil and gas operators regularly hire third party environmental consulting firms to perform a variety of functions such as collecting samples, conducting excavation, and developing workplans (i.e. Site Investigation and Remediation Workplans) for ECMC approval. Oil and gas operators are always responsible for ensuring the integrity of their operations, which includes contracted environmental consultants and reports to ECMC. In this case, due to initial voluntary disclosures by operators, ECMC is aware that individuals at two environmental consulting firms — Eagle Environmental Consulting, Inc. and Tasman Geosciences — allegedly altered laboratory data that they submitted to ECMC on behalf of their clients to varying degrees: Eagle Environmental Consulting, Inc. on behalf of Chevron U.S.A. Inc. and Civitas Resources Inc. and Tasman Geosciences on behalf of Occidental Petroleum Corp.
ECMC’s investigation is on-going and the outcome of the investigation could include enforcement action and fines. Additionally, given the degree of alleged fraud, ECMC is cooperating with law enforcement regarding criminal and civil penalties. ECMC will provide additional information to the public as the investigation unfolds.
“Our team is dedicated to the protection of public health, safety, and welfare and the environment and wildlife resources. Following the disclosure of the falsified data, we took immediate action to investigate the allegations. We hold operators responsible for their contractors’ work, and I appreciate their self-reporting and cooperation to date,” said Julie Murphy, ECMC Director. “This is an aberrant and disappointing situation. Maintaining the integrity of the data upon which ECMC — or any regulatory body — bases decisions is essential. Our permitting, compliance, and enforcement procedures — including the submission of reports, data, and samples by operators — are grounded in an expectation that all parties abide by the law and follow a basic professional, ethical code of conduct."
ECMC’s awareness of the scale of the issue grew over time. Specifically, in July ECMC was notified of a few limited potential instances of data falsification and in August a second operator provided a similar notification. In response, ECMC began an investigation to understand the scope of the issue and potential risks and took steps in early September to prevent future falsified data from being submitted. In early October, as a result of the investigation, ECMC determined that the scope expanded from a limited data set to potentially hundreds of instances of data falsification. In response, ECMC formalized its internal investigation. That investigation, which is ongoing and outlined in this announcement, includes determining which regulatory forms contained laboratory reports that could have been altered, determining risks, and identifying if projects or spills need to be reexamined as a result.
“I am disappointed in the actions of a few consultants to oil and gas operators who have undermined the industry’s ability to meet their regulatory obligations,” said Dan Gibbs, Executive Director, Colorado Department of Natural Resources. “I have complete confidence in the leadership and staff at the Energy and Carbon Management Commission to investigate this falsification and take appropriate enforcement action as well as work with appropriate law enforcement.”
About the ECMC
The mission of the Colorado Energy & Carbon Management Commission (ECMC) is to regulate the development and production of the natural resources of oil and gas, deep geothermal resources, the capture and sequestration of carbon, and the underground storage of natural gas in a manner that protects public health, safety, welfare, the environment and wildlife resources. Visit the ECMC website for more information.