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After issuing a notice of violation, state board awaits plan to cap well

PIERRE -- The state Board of Minerals and Environment is waiting for a reclamation plan from the company that tried to drill an oil well three years ago in Pennington County near Wasta but failed to complete it.

PIERRE - The state Board of Minerals and Environment is waiting for a reclamation plan from the company that tried to drill an oil well three years ago in Pennington County near Wasta but failed to complete it.

The company, called Quartz Operations, received permits for two wells from the state board in 2013. The drill broke and the bit remains in the well shaft. The drill hole remains uncapped.

The board required a bond of $130,000 to be posted for the first well. The second well wasn't attempted. The money isn't sufficient to pay for capping the unfinished well.

The state board during a June meeting at an ethanol plant near Aberdeen held an executive session and then voted to issue a notice of violation, according to official minutes from the meeting.

During that meeting the state's mining program administrator Bob Townsend said his office hadn't issued a notice of violation before for an oil or gas well.

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Mike Lees, a mining program employee for the state Department of Environment and Natural Resources, told the board Thursday that the notice of violation was issued July 1.

He said the notice called for Quartz Operations to submit a funding plan and to plug the well.

The 30-day deadline to challenge the facts in the notice have passed, Lees said.

The company's lawyer, whom Lees didn't publicly identify Thursday, responded with a letter recently saying a funding plan would be submitted.

The lawyer was interested in whether the entire hole needed to be plugged or plugs could be placed between each underground water formation, according to Lees.

"We're working on response now to clarify that," Lees said.

The funding plan for the reclamation work is due Sept. 1. A contested case hearing could be scheduled for Nov. 17.

"Sounds like we'll know more in September," replied Rex Hagg, of Rapid City. He is the board's chairman.

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Another board member, Bob Morris of Belle Fourche, asked Lees whether the company's lawyer indicated what would happen to the bit that remains in the hole.

Lees responded that isn't the concern. He said the violation is the unplugged hole.

Lees said afterward that he didn't know whether he could fulfill a news reporter's request for a copy of the notice of violation and the company lawyer's letter.

He said he needed to ask the state Office of Attorney General whether he could provide the documents because it is an active enforcement case.

As of 5 p.m. Thursday there was no further word on the documents.

At the board's May meeting Lees estimated the cost of plugging the well to a range of 3,000 to 3,800 feet deep would be about $2 million. The well was supposed to reach about 9,700 feet and pierce seven aquifers.

The woman behind the project was Natalie Ormiston, then of Deadwood.

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