Proposed energy rules blasted

But attacks from 2 oil firms called 'misleading'

By Todd Hartman, Rocky Mountain News

Published January 8, 2008 at 12:30 a.m.

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Two major oil and gas companies are attacking proposed state energy regulations - one in a blistering memo to its employees and the other in a letter warning nonprofits that the rules could limit its charitable donations.

But a top state official, and others on the Western Slope, are critical of the correspondence, accusing one company of twisting the truth and the other of threatening nonprofits.

The regulations, still in the early drafting stages, likely will require more consultation between state energy regulators and Colorado health and wildlife agencies about the impact of drilling on the environment and public health. Companies could also be required to post higher bonds to ensure environmental protection, pay higher fines for violations and disclose more of the chemicals they use in their operations, among many other changes.

Williams Cos., in a recent memo to employees and contractors, said the state's Oil and Gas Conservation Commission was attempting to "railroad" the process and pass the new rules "in stealth." The memo described the rules as a "multi-tiered bureaucratic nightmare" and potentially "ruinous to our industry."

EnCana Oil & Gas, in a Dec. 27 letter addressed "Dear Non-Profit, Community Partner," asked groups getting money from it to attend a public hearing on the proposed regulations "and provide your valuable feedback."

EnCana's letter said the new rules would mean less tax revenue to state and local government, "costly" permitting delays and lower natural gas production.

The rules could affect "the company's ability to partner with organizations such as yours that meet the needs of the community on a daily basis," the letter said.

Harris Sherman, head of Colorado's Department of Natural Resources, said he was "disappointed" with the letters. His agency oversees the oil and gas commission.

He called the letters inaccurate reflections of a rule-making process designed to be "open and inclusive" with about 35 meetings slated in the next two months alone.

"We're trying to foster real dialogue, trying to get thoughtful input from all parties, including industry," Sherman said. "The exaggeration and misleading statements . . . of these letters do not help the process."

"It's critically important for us to get honest, straightforward input based on facts and mutual respect," he said.

The EnCana letter drew criticism from Bruce Christensen, who runs a nonprofit in Glenwood Springs to aid developmentally disabled people. Never in 30 years of his work has he encountered such a request from a donor, he said.

"I would like to think people who support the nonprofits do it because they support their mission and are trying to be a good neighbor within the community - and I don't know that those are connected with lobbying on energy regulation," said Christensen, also the mayor of Glenwood Springs.

Also critical was Duke Cox, interim director of Western Colorado Congress, a citizens group that has often fought for more oversight of energy development.

He said the letter amounted to EnCana "threatening nonprofit associations that they supposedly willingly and freely donate to."

A spokeswoman for EnCana, Wendy Wiedenbeck, said the company donated $2.7 million to Colorado charities in 2007, and "we take great pride in the partnerships we've developed with these organizations."

Asked about the letter to nonprofits, Wiedenbeck said the intent "was to inform them and encourage them to participate in the public process."

As to criticism leveled at the company for sending the letter, Wiedenbeck said, "I respect that they have a different opinion . . . Our participation and our partnerships with nonprofit organizations where we live and work will continue."

Susan Alvillar, a spokeswoman for Williams, said: "I think the message that we were trying to get across to all our contract workers is that this matter is extremely important. The time is now to speak up."

hartmant@RockyMountainNews.com or 303-954-5048

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