Senate panel clears oil-gas regulatory bill

Measure would broaden makeup of commission

Colleen Slevin, Associated Press

Tuesday, April 17, 2007

More people from outside the oil-and-gas business - including the state's top health official - would help regulate the industry under a proposal unanimously backed by a Senate committee Monday.

Harris Sherman, the state's natural resources chief, helped negotiate changes to the original proposal - a main goal of Gov. Bill Ritter this year - that led the industry to drop its opposition.

The measure would keep Ritter's main objective of broadening the makeup of the regulatory commission, but many of the nuts and bolts of how health and environmental concerns could stop or slow production would be worked out later.

Sherman said House Bill 1341 would be good for the public and the industry, which he said provides both high-paying jobs and significant tax revenue to the state.

"We're going to give greater attention to the variety of concerns that have been expressed by the public while we see this significant expansion of the oil-and-gas industry," said Sherman, who also would serve on the overhauled commission.

He said that the state expects to approve 6,000 gas permits this year, six times as many as were approved in 2000. Meanwhile, he said the commission's composition as well as its focus on production first has left the impression that the industry is regulating itself.

Right now, all but two of the commission's seven members must have a background in the industry. The bill would expand the commission to nine members by adding the directors of the state natural resources and health departments, but only three of its members would have to have industry backgrounds.

Commission chairman Peter Mueller, vice president of Saga Petroleum, said he was concerned about losing the technical expertise provided by people who work in the industry.

The Colorado Petroleum Association and the Colorado Oil and Gas Association opposed the original proposal but are now taking a neutral position. The main reason is that lawmakers agreed to get rid of language that would have changed a provision in the law that promotes the extraction of oil and gas in the most efficient way possible.