Oil and gas commission adopts rules for well location
The Colorado Oil and Gas Conservation Commission on Monday finalized new rules to enhance collaboration and communication with local governments when a large-scale oil and gas facility is located in an urban area, such as near a residential neighborhood. There were dozens of minor changes, but here is the gist:
» The commission decided the definition of a large scale oil and gas facility in an urban area as a pad with eight wells, both vertical and lateral, and 4,000 barrels of oil storage on site, or essentially eight 500-barrel tanks. That size would trigger the consultation with a local government.
Citizen groups had sought to define that area as 45,000 feet of total drilling — half of what was originally proposed — and 2,000 barrels of oil storage at a site. The commission took out the drilling length to avoid confusion.
» The rules would require operators to notify local governments within 1,000 feet of the large development for the consultation. The rules would not allow the government to restrict the development. COGCC approval of a permit would be predicated on an operators’ agreement with a local government. If there were no agreement, the issue would go before the commission for a hearing.
» Nearby local governments, outside of the municipality in which a project is proposed, would not be given standing in the decision-making, though they would be notified if they were within that 1,000 feet.
Citizen groups had sought to send notifications to local governments within a mile of proposed developments. The groups also had request to notify residents within 1,500 feet of any proposed large urban drilling area. The state mandates notification of homeowners within 1,000 feet, but such notifications were not intended to be a part of this rule.
» The rules also would require operators to provide proof of their search for alternative sites, and reasons why those sites were not considered.
» Operators will have to notify surface owners of their intentions, and invite comment. Existing surface use agreements however, would be an exception to the rule to notify the landowner.
COGCC staff had originally approved a drilling limit, and one citizen group expanded on that, seeking a limit of 90 days for all drilling and completion operations at a well site, with a five-year grace period between drilling. Drilling times were taken out of the final rules, so that proposal wasn’t entertained.
» Operators must register their five-year drilling plans with municipalities beginning May 1.
» The commission stopped short of requiring operators to detail plans for drilling within municipal growth areas, which some groups had suggested.
DENVER — To the chagrin of residents who wanted to eradicate oil and gas drilling from residential areas in Colorado, the state commission governing oil and gas on Monday adopted rules that regulators say will enhance a local government’s role in the location of oil and gas wells.
The Colorado Oil and Gas Conservation Commission decided on the size of an oil and gas facility that would trigger a consultation with a local government, and it approved a set of rules to determine when operators had to consult with local governments on siting of a large-scale oil and gas facility in urban areas. The rules were part of the directive by the Governor’s Oil and Gas Task Force, which wanted to craft rules to enhance local government involvement in large-scale oil and gas facilities in urban areas.
What the group didn’t do was draw a hard line — prohibiting all drilling from residential areas, which many resident and environmental groups had urged in the last few months.
Kirby Wynn, Garfield County oil and gas liaison, represented multiple Western Slope governments throughout the process. Wynn lauded the efforts.
“You’re as close as you’re going to get with these draft rules,” he said. “We believe the rules now do so in a manner that assures consultation process. There’s no such thing as perfect, but you did a pretty good job.”
Battlement Mesa residents, who face drilling within their neighborhood boundaries, had lobbied the commission for protection that they said the rule does not give them.
Sara Barwinski, a member of the governor’s task force who recently moved to Estes Park from Greeley because of her proximity to oil and gas operations in her prior home, told members Monday they were doing a disservice to Colorado.
“You delude yourselves if you think passing this rule solves any of the problems that Colorado is facing in oil and gas development in communities,” Barwinski told the group in its final hearing Monday. “It exacerbates the problem because impacted citizens will clearly realize they cannot trust the COGCC to meaningfully regulate the industry.”
The COGCC has spent the last several months arriving at two specific rules to implement changes suggested by the task force last year. The task force was formed as a compromise for groups to back off proposed ballot issues that would increase setbacks between wells and residences.
The rules define a large-scale facility that would trigger a government consultation, and how operators go about coming to agreements for siting.
Local governments would be allowed to opt out if they have their own process, or have exiting memorandums with operators.
Matt Lepore, director of the COGCC, told commissioners early on they would hear from a variety of concerns that the proposed rules do not meet the four corners of what the task force suggested, but he emphasized that the decision-making fell on their shoulders.
“It has indeed been a challenging rulemaking,” Lepore said. “The task force tasked this commission with creating a process to enhance collaboration between local governments and the commission. It’s easier said than done. It turns out to be not all that easy to regulate relationships, especially when operators are different and local governments are different.
“Local governments all have their own way of doing things, and that makes it difficult to create rules to fit everyone in and allow them flexibility to go their on way. The rules before you strike that balance very well.”
A growing problem will be that oil and gas production will increase throughout the state, and they will be closer to residential areas, said Dave Neslin, former director of the COGCC who was representing the industry response to the commission on Monday. As the population grows, it encroaches on oil and gas holdings.
“First, significant development will occur in and near urban areas in the future,” Neslin said. “You’ve heard from operators how they previously focused on remote areas, but much of that has been developed. There are at least two operators in Colorado who have told you their acreage in and near municipal areas now account for more than 30 percent of their holdings … and there will be substantial urban ground anticipated in next 25 years.”
Barwinski and others representing residents and environmental groups throughout Colorado on Monday chided the commission for catering to the “sociopathic” oil and gas industry’s desires with the proposed rules.
Barwinski warned if the group doesn’t change the rules to reflect the wants of residents and taking their safety into account, they would be kicking the can down the road. They would become a part of the political theater and invite citizen protest and ballot initiatives. Those against oil and gas drilling near people contend the industrial process involved with drilling is harmful to residents’ health, though there are state regulations that govern allowable emissions and protect waterways.
“The public deserves to know this rule is window dressing,” Barwinski said. “It won’t protect them when oil and gas comes knocking at their doors. If you don’t revise this rule, the task force and COGCC will both have failed the people of Colorado.”
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