Colorado’s three largest oil and gas producers were hit with violation notices for falsified lab reports that minimized the levels of a wide variety of pollutants, including arsenic and barium in the soil and benzene in groundwater.
The seven notices of alleged violation were issued by the Colorado Energy and Carbon Management Commission to the operating subsidiaries of Chevron, Occidental Petroleum and Civitas Resources. The companies have 28 days to respond.
The lab reports were falsified by two environmental contractors — Eagle Environmental Consulting, Inc. and Tasman Geosciences — and came to light last year.
By that time, however, hundreds of sites had been deemed remediated and had been closed.
“This remains a disheartening and heavy subject, and the investigation revealed further issues than were initially reported to us,” ECMC director Julie Murphy told the commission Wednesday.
Murphy described the falsification as done by “nefarious actors who have betrayed our trust.”
In July 2024, Eagle Environmental notified Chevron that one of its employees had manipulated data on required Form 27s and the oil company then notified the ECMC. Civitas was similarly notified by Eagle Environmental, retested laboratory samples and contacted the ECMC.
“When Chevron became aware of this fraud, it promptly launched an investigation into these incidents and disclosed a list of the potentially impacted sites to the Colorado Energy and Carbon Management Commission,” the company said in a statement.
Tasman Geoscience told Occidental that some lab reports had been fabricated. The ECMC was first briefed on the unfolding scandal in November.
“We were extremely disappointed to learn that an Oxy contractor submitted regulatory filings on Oxy’s behalf that contained inaccurate, falsified data,” the company said. It also said it is reviewing the violation notice.
So far, ECMC has identified 3,275 instances of falsified data points on 683 lab reports spanning 404 locations. The sites are scattered among 15 communities in Weld County.
In soil samples, arsenic and barium were the most frequently under reported pollutants and in water samples it was benzene, a known carcinogen, and 1,2,4-Trimethylbenzene. In some cases the contaminants were three orders of magnitude higher than reported.
The sites will have to be reevaluated, contaminants delineated and new remediation efforts undertaken by the operators.
In one case, the level of benzene in well water was 1,010 micrograms, but reported as 4.55 micrograms. The allowable limit is 5 micrograms. Another sample was reported as 1.05 micrograms when it was actually 191 micrograms.
In some cases, the false lab reports led to sites being deemed remediated and allowed to close, said Arthur Koepsell, ECMC’s environmental data group supervisor.
In one case on farmland in rural Weld County, a remediation system was installed and started on a well site in October 2021. It showed benzene concentrations were below ECMC cleanup standards and even below laboratory reporting detection limits.
The operator was allowed to shut down the remediation system in 2023, based on false lab readings.
“This project is situated on an agricultural property adjacent to an irrigation canal and in very close proximity to a surface water pond, which appears to be hydraulically connected to shallow groundwater,” Koepsell said. “This is an egregious example of significant alterations over time affecting not just the regulatory outcome, but having actual consequences in the environment.”
The site will have to be reevaluated and a new remediation plan put in place.
“Said plainly,” the ECMC said, “the consultants allegedly falsified data in a manner that led state regulators to approve Form 27s, which led to the closure of oil and gas locations that otherwise would have not been approved for closure.”
All impacted sites that were previously approved for closure, like the Weld County farm, have been reopened and ECMC contacted surface owners in December 2024.
The violation notices were sent to Occidental’s subsidiary Kerr McGee Oil & Gas and to Chevron’s Noble Energy Inc. Five Civitas operations — 8 North LLC, Bonanza Creek Energy, Extraction Oil & Gas and Crestone Peak Resources — received notices.
“When Civitas Resources learned of the falsified reports by our third-party contractor, we notified the ECMC and conducted our own internal audit to understand the extent of the wrongdoing,” Civitas said in a statement. “We’re quickly seeking to remedy the contractor’s failures, while creating new requirements going forward to prevent this from happening again.”
Chevron is Colorado’s largest oil and gas company by production followed by Occidental and Civitas.
The ECMC said it has also placed added safeguards to prevent the submission of false data, including additional documentation and lab report audits. The agency has also hired a forensic investigation team to develop a way to electronically review data analysis.