Gov. Hickenlooper unveils proposed emissions regulations on oil, gas industry
DENVER — Flanked by representatives from the oil and gas industry and the environmental community, Gov. John Hickenlooper on Monday unveiled a proposed emissions regulation that makes Colorado’s rules the toughest in the nation.
“These proposed rules provide common sense measures to help ensure Colorado has the cleanest and safest oil and gas industry in the country,” Hickenlooper said in a statement. “The rules will help Colorado prepare for anticipated growth in energy development, while protecting public health and environment. They represent a significant step forward in addressing a wider range of emissions that before now have not been directly regulated.”
The announcement, in a press conference at the Capitol, capped off months of private negotiations between the Environmental Defense Fund, Anadarko Petroleum, Noble Energy and Encana, on proposed changes to the state’s air quality control regulation in the oil fields that all involved say resulted in a tough new rule that will hold the industry’s feet to the fire, while helping to clean Colorado’s air. The intent is to reduce methane emissions from oil and gas storage and drilling equipment.
“From a groundbreaking air study with Colorado State University to monitoring wells for leakage with infrared technologies, western Colorado’s natural gas industry has always been ahead of the curve,” wrote David Ludlam, West Slope Colorado Oil & Gas Association executive director, in an email reacting to the release of the rules.
“Our track record shows the seriousness with which our members approach improving air quality, and we’ll apply that same seriousness in working to see if these rules can be tailored appropriately for the rural energy development we have here on the West Slope,” he added.
“It is a tough rule,” said Ted Brown, senior vice president of Noble’s northern region, addressing the onlookers at the Capitol. “It’s been a tough road to get here. … I really believe this proposal sends a message that we can have a healthy environment, a strong economy and responsible energy development in Colorado.”
The proposal would govern industry’s response to detection of leaks on storage tanks, as well as repairs, and timelines for them, and even governs regular inspections of oil field equipment with infrared cameras that will cost the industry roughly $30 million a year to comply. The rule would be applied statewide, as well.
“It’s a high bar, but a fair bar,” said Will Allison, director of the air pollution control division at the state, after the announcement. “There are differences of opinion on elements of the proposal. It’s cutting edge but common sense.”
Health officials say the rule will take 92,000 tons of VOC emissions out of the air — the equivalent of taking all of the cars off the roads in Colorado for a year.
The proposal is set to be sent to the state Air Quality Control Commission on Thursday in preparation for a rulemaking hearing in February. Officials hope it will become part of the rulebooks by spring 2014.
“This will be by far the strongest rule in the country in terms of leak detection and repair,” said Larry Wolk, executive director and chief medical officer at the state Department of Health and Environment, addressing onlookers.
It wasn’t an easy road, and officials from both sides said they had to give in a little to strike the balance that the proposal represents.
“We didn’t get everything we wanted,” said Dan Grossman, regional director for Environmental Defense Fund’s Rocky Mountain Regional Office. “There will be robust participation by the environmental groups and the industry, but the commissioners will ultimately decide.”
Grossman said he pushed for monthly inspections on oil field equipment, but said the ultimate proposal of monthly inspections on larger sources of emissions, and quarterly inspections of smaller sources, was a fair compromise.
He said that may still become a sticking point during the formal rule-making.
“Quarterly is good, but not as good as monthly,” Grossman said, adding that monthly inspections would cut about 80 percent of emissions and quarterly would shave only 60 percent.
The expense to comply with the proposal is something oil industry officials say makes them gulp a little harder, but ultimately one they think they can tolerate.
“We are looking at significant costs, but we think it’s manageable,” Brown of Noble said.
The proposal is just that. The state Air Quality Control Commission has the final say on the rule, which it could massage into an entirely different version.
But industry officials and those in the environmental community said they stood behind the proposal and would not argue for any further changes.
“We wouldn’t put our name on it if we didn’t think we could” live with it as is, said Brad Holly, vice president of the Rockies operations for Anadarko.
Pete Maysmith, executive director of Conservation Colorado, said he was pleased with what he heard on Monday, and will attend the rulemaking to make sure the proposal resembles what officials lauded.
“There’s work to be done in the sense that this is a beginning,” Maysmith said after the announcement. “We need to make sure the finalized version is at least as strong as what was said here today.”
Drew Munro of the Post Independent contributed to this report.
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