Oil & Gas in your Neighborhood

The Town of Frederick maintains a strong commitment to balancing energy development with public health, safety, and quality of life. Oil and gas operations operations are an important part of our region's history and economy, and the Town works proactively to ensure these activities are conducted responsibly and transparently. We maintain that the Oil and Gas Operators have a responsibility that extends beyond drilling and production; it carries the obligation of proper remediation from its operations; including plugging and abandoning wells properly, cleaning up impacts, and properly reclamation the land to its previous condition.

According to Colorado’s financial assurance rules, adopted under Senate Bill 19-181, three layers of protection address the risk of operators walking away from their obligations to plug and abandon wells.

• Option levels. The new rules require increased financial assurance obligations for operators representing the greatest threat to the state. Operators are required to carry increased financial assurance as their average daily production decreases. 
• Single well financial assurance for low-producing wells. The new rules also require increased financial assurance for “low-producing wells.” Low-producing (uneconomic) wells are most likely to be orphaned if an operator files for bankruptcy. $100,000 for each location (reclamation) and $10,000 - $40,000 per well (plugging costs) 
• Orphan Well Fund. Recognizing that the state will not get to zero risk, the Commission has also created an enhanced $20 million / year “orphan well fund” capable of plugging and abandoning up to 200 wells per year.

Local Response to Oil and Gas Impact on Our Community

KP Kauffman (KPK), an independent oil and gas production and well service company, owns over 100 of the active wells in the Town of Frederick, almost all of which are considered “low producing” or uneconomic. KPK’s current proposed financial assurance plan to plug and abandon, clean up and remediate these wells is gravely deficient.

To uphold the well-being of our community’s public health, safety and welfare and prevent undue financial strain to taxpayers, the Board of Trustees as well as State Representative Jennifer Parenti, are advocating for the State of Colorado and the Colorado Energy and Carbon Management Commission (ECMC) to reject KPK’s proposed financial assurance plan and mandate a plan that provides more security and protection for the welfare of our community. 

Read Mayor Crites' letter to Governor Jared Polis

Watch Denver7's Interview with the Town of Frederick

To keep our residents informed, we want to share important updates regarding KP Kauffman’s (KPK) oil operations in the Town of Frederick. 

• October 20, 2025, Town representatives met with local oil and gas operators as part of our ongoing commitment to work collaboratively with responsible operators to develop long-term solutions that prioritize community safety and environmental stewardship. 
• June 26, 2025, The ECMC issued a final decision requiring two wells in Frederick to be plugged and abandoned with any accompanying site remediation within 12 months.
• May 28, June 11, June 18, June 25, 26, 2025, A hearing involving the Town of Frederick, a neighboring jurisdiction, and KPK convened to address KPK's responsibility for plugging and abandon wells that are low producing or no longer producing.
• October 11, 2024,  Letters and emails received by the Board of Trustees from residents and businesses related to oil operations in Frederick have been included in the Oct. 22 Board of Trustees Meeting Agenda Packet. 
• September 30, 2024, Revisions to the ordinance for code amendments to Article 9 of the land use code regarding Oil and Gas Drilling and Production will go to the Planning Commission for review on Oct. 3, 2024, and to the Board of Trustees for review on October 22, 2024.
• August 20, 2024, the Town of Frederick is still experiencing additional KPK spills and releases, with the most recent ground surface stained soil observed on August 19. We are actively collaborating with the ECMC to address and advance the ongoing remediation efforts throughout the town.
• On April 23, 2024, the Board of Trustees voted on Ordinance No. 1392, which proposed a temporary Moratorium for applications for Oil and Gas Development within the Town of Frederick. Following a lengthy discussion, the need for a pause to prioritize the refinement of the land use code and provide clear guidelines to operators was the consensus to ensure prudent governance practices. The motion to approve the Moratorium passed with a 4 to 1 majority.  
• On February 14, 2024, the Town reached out to Governor Polis, Senator Barbara Kirkmeyer, Representative Jennifer Parenti, and Weld County Commissioners with a letter asking for their support in amplifying our concerns and securing the necessary financial assistance required for successful oil and gas remediation in the Town of Frederick.
  See a list of KPK remediation sites and a map of the 2023-2024 oil spill and release locations. 

The ECMC notified KPK  that they require KPK to take the following actions:

1. By close of business on February 6, 2024, deactivate and depressurize the specified flowline facility.

2. Provide documentation describing the cause of the spills, including, but not limited to, an evaluation of possible internal or external corrosion, external force, design and installation deficiencies, third party, or overpressure damage as a root cause of failure.
3. Develop and provide a detailed description of the measures that will be taken to prevent the recurrence of the failure mechanisms identified in the root cause analysis.
4. Provide documentation of repairs conducted in response to the Spills from the specified flowline facility and include the relevant manufacturer’s specifications or applicable technical standard.
5. Conduct ECMC-witnessed post-repair pressure testing of the specified flowline facility. Submit documentation of successful test(s).

• Between January 1, 2024, and January 26, 2024, five KPK well leaks were reported within the Town limits.  The occurrence of five leaks since the beginning of 2024 is evidence that the integrity of KPK’s flowline systems needs immediate attention. The Town thoroughly reviewed the initial spill reports, the inspection reports, and subsequently filed a complaint with the Colorado Energy and Carbon Management Commission (ECMC) requesting immediate action to require integrity tests of all flowlines within 500 feet of homes and a full review of KPK's integrity management plans and leak detection and monitoring plans.  We want to ensure KPK is held accountable for conducting responsible and timely remediation operations to protect the health and safety of our community.  We are committed to our community’s well-being and will share new information as it becomes available.
• On Oct. 26, 2023, the ECMC unanimously voted against KPK's plan for financing the environmental cleanup of its wells. KPK originally proposed $10.3 million to ensure the proper closure of its wells. ECMC members voted to require KPK to provide roughly $133 million over the next 10 years to meet its obligations to plug and reclaim these wells. Mayor Crites expressed her appreciation to the ECMC for their findings and support in holding KPK accountable.  The hope is that this decision will lead operators to commit to stronger financial assurance planning and fewer orphaned wells throughout Colorado.

The Board of Trustees emphasized the Town's support of the oil and gas industry and for the operators that follow the rules while highlighting that regulations have not kept up with the pace of development. To hear the full conversation watch the Board of Trustee meeting recording.