September 23, 2004

On September 3, the Department of Environmental Quality issued a Unilateral Order against Mildco, Inc. of Jackson. The order required the company to comply with the State of Michigan’s oil and gas regulations.

On June 23, the DEQ brought an administrative action alleging that Mildco, Inc. had failed to economically produce or properly plug and abandon the Curtis 1-18A well located in Liberty Township, Jackson County, Michigan. In addition, the DEQ alleged that Mildco, Inc. had failed to encapsulate a lined drilling mud pit which had remained open for more than four years, in violation of state regulations. The mud pit was used to hold drill cuttings, and associated fluids from the Curtis 1-18A well, which were produced during the drilling of the well. During the past four years, the mud pit liner had torn in several areas which allowed some fluids, including waste oil and chlorides, from surface spills at the Curtis 1-18A well site to leak into the surrounding soils. The DEQ brought the action in order to prevent waste and to respond to a potential threat to the waters of the state.

The DEQ’s Order, effective September 3, requires Mildco, Inc. to place the well into economic production or properly plug and abandon the Curtis 1-18A within 60 days of the date of issuance of the Order. Mildco, Inc. is required to cleanup and properly dispose of all contaminated soils surrounding the Curtis 1-18A well site, remove and properly dispose of any oil remaining in the mud pit, and fully encapsulate the mud pit. Encapsulation of the mud pit includes adding cement to stiffen the liquid portion of the liner contents and prevent further leakage of the contents. The Order also requires Mildco, Inc. to pay a penalty of $10,000 for failing to address the violations in a timely manner.

“The DEQ’s highest responsibility is to protect the environment and public health in Michigan, and this action was necessary for us to live up to that responsibility,” said DEQ Director Steven E. Chester. “Oil and gas companies must be good neighbors to the community they are a part of.”

This is the sixth Order issued by the Director of the DEQ as Supervisor of Wells against violators of oil and gas regulations this year.

Editor’s note: DEQ news releases are available on the department’s Internet home page at www.michigan.gov/deq.

Revised September 23, 2004 by Linda Davaloz LeVeque