State panel scales back drilling rules

Changes occur after oil and gas industry launches offensive

Gargi Chakrabarty

Published June 18, 2008 at 8:05 p.m.

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Photo by Darin Mcgregor / The Rocky

Floor hand Mark Schreiner sets up another piece of drill pipe Wednesday on Ensign Rig 5, which is drilling a well for Anadarko Petroleum Corp. east of Longmont in southern Weld County. Gov. Bill Ritter's administation has revised proposed drilling rules that drew objections from the energy exploration industry.

Gov. Bill Ritter's administration on Wednesday watered down proposed rules for oil and gas drilling in Colorado in the wake of an aggressive campaign by the industry that said the proposals would cost thousands of jobs.

Clarifications of the proposed rules were posted late afternoon on the Web site of the Colorado Oil and Gas Conservation Commission, the state agency charged with rewriting the regulations. The commission will hold hearings Monday through July 1, and a decision is scheduled Aug. 12.

"I wouldn't view (the clarifications) that way," said COGCC acting Director David Neslin, referring to suggestions the agency was weakening rules under pressure from the industry.

"In some instances, we are taking a more surgical, a more nuanced approach to a particular issue," he said. "We are putting forth language that better reflects our intent and provides additional time for discussions of wildlife impact mitigation to occur."

Two influential industry groups - the Colorado Oil and Gas Association and the Colorado Petroleum Association - on Monday launched a weeklong advertising campaign to denounce the proposed rules, saying they would displace 10,714 jobs.

Meg Collins, president of COGA, said the revisions do little to assuage the industry's concerns.

"We'll take a look at it but I doubt our concerns will change much," Collins said. "And I really am not at all clear as to what process will be used by the oil and gas commission to incorporate these clarifications in the docketed draft rules of March 31."

For instance, the commission clarified that companies that consult with the Colorado Division of Wildlife or develop a comprehensive drilling plan would not be subject to timing restrictions until January 2010.

Currently, the restrictions prohibit drilling during certain times of the year, say, from Jan. 1 through March 31 and in certain areas west of Interstate 25 to protect winter concentration areas of pronghorns. Shorter time restrictions apply to other species, such as May 15 through June 15 for elk production areas.

Collins criticized the clarification, saying even if companies consult with the Division of Wildlife, it was not guaranteed that they would receive waivers.

"The clarification is just delaying the 90-day shutdown in activity to 2010 from 2008-2009," Collins said. "It's just moving forward whatever the complications we see from such shutdowns - economic displacements, job losses and a slowdown in the industry."

Suzanne O'Neill, executive director of the Colorado Wildlife Federation, also expressed concern about the clarification, but from a different perspective.

"What would happen in the interim period, what sort of protection would be available to balance wildlife with density of wells?" O'Neill posed. "We are concerned because we have to assume the current pace of drilling applications would continue until January 2010."

Few expect the clarifications to result in any thawing of relations between the commission and the industry.

"I think it's a first step in having a conversation," said Rick Ridder, a Democratic political strategist. "But I have no sense where that conversation is going to go."

Proposed rule changes

State regulators on Wednesday scaled back draft rules for oil and gas drilling, rules that the industry opposes.

Draft rule

* Oil and gas operations must be located at least 500 feet from a spring, water well, or section of stream used for a public water supply.

* Restrict drilling during certain times of the year to protect wildlife habitats, but operators can bypass by consulting with the state Division of Wildlife, developing comprehensive drilling plans, or restricting development.

* Avoid drilling in areas within 300 feet of the ordinary high water mark of any reservoir, lake, wetland, or natural perennial or seasonally flowing stream or river.

* Require companies to use scientific surveys near drilling areas coinciding with the season and activity of certain species.

* Require all condensate tanks in Piceance and San Juan basins emitting a certain amount of pollution and within a half-mile of a school, hospital, home or jail to install odor control devices.

Change

* Reduces setback to 300 feet for perennial streams and 150 feet for seasonal or intermittent streams used for drinking water. An interim buffer zone would be created between that distance and 500 feet where additional conditions will apply. * Restrict drilling during certain times of the year to protect wildlife habitats, but operators can bypass by consulting with the state Division of Wildlife, developing comprehensive drilling plans, or restricting development.

* Companies choosing to pursue consultation with state wildlife officials or a comprehensive drilling plan will not be subject to certain restrictions until January 2010.

* Avoid drilling in areas within 300 feet of the ordinary high water mark of any reservoir, lake, wetland, or natural perennial or seasonally flowing stream or river.

* Applies only within 300 feet of designated cutthroat trout segments of streams and gold- medal fishing streams.

* Require companies to use scientific surveys near drilling areas coinciding with the season and activity of certain species.

* Surveys can be conducted at any time of the year and are required for a narrower range of species.

* Require all condensate tanks in Piceance and San Juan basins emitting a certain amount of pollution and within a half-mile of a school, hospital, home or jail to install odor control devices.

* Requirement limited to the Piceance Basin.

Source: Colorado Oil and Gas Conservation Commission

chakrabartyg@RockyMountainNews.com or 303-954-2976

Public comment

* The Colorado Oil and Gas Conservation Commission will hold a hearing to take public comment on proposed rules for oil and gas drilling from 8 a.m. to noon Monday at the Paramount Theater, 1631 Glen arm Place.

• June 19, 2008

  5:03 a.m.

  Suggest removal

  gratefulweb writes:

  If the GOP had their way, Colorado's landscape would look like that of Texas (riddled with hideous oil rigs). McCain, the tool, just did as big a flip-flop (catering to big oil) on opening our coasts to oil exploration. I thought McSally wouldn’t sell his soul to big oil, but now Mr finance reform, ethics reform, etc. is turning out to be another hypocrite like much of the GOP.

  Wildlife preservation, higher gas mileage standards, conserve, bring on Obama, we need him more now than ever.

• June 19, 2008

  6:24 a.m.

  Suggest removal

  soccermom writes:

  They are not concerned about job losses for their people, they are just exploiting them for their ad campaign. Did they show compassion for the communities and folks on the Western Slope when the oil shale industry folded the last time?

  The intent of the law is clear, the people of Colorado want their air, water and wildlife to have some good protections in place.

• June 19, 2008

  6:42 a.m.

  Suggest removal

  danirobi writes:

  Ok, you want your clean air, water and wildlife protected, then don't complain when you can't fill up your tank soccerman. Don't complain when the renewable energy people come in and tell you that in order to build a wind farm in a remote location (cause heaven forbid it be in your backyard) and they need to build a transmission line, don't complain. Environmentalist want it both ways, well I'm sorry but life just doesn't work that way. People are more concerned with wildlife and the environment than they are human beings.

• June 19, 2008

  6:49 a.m.

  Suggest removal

  Logical writes:

  GW, SM - Don't either of you EVER complain about the cost of heating your home, or the price of your electricity. Curtailing drilling will raise the price of both.

  McCain realizes the need for additional production of gas and oil, unlike the two of you. Times change, so we must also change our processes. We need to drill to keep prices down, and to give us the ability to produce heat and electricity until a VIABLE alternative source of energy is available.

  During drilling, it is unsightly. But after restoration, there is very little impact, other than a tank battery which can serve many wells from one location, and some pump-jacks. These are much less visible than 300-foot windmills all over the eastern plains. Why are windmills okay, but not gas wells? NIMBY???

  Obama will take more money from you and I (taxes for his social programs) than our energy bills will ever take. I, for one, want to keep my money to spend how I see fit, not fork it over to the government to redistribute however they think they need in order to be re-elected. GOP politicians are not the only hypocrites, all parties are full of slobs whose main interest is to get re-elected. We sure don't need Obama!

• June 19, 2008

  10:26 a.m.

  Suggest removal

  gs writes:

  I'd like to see the specific reasons the oil and gas industry object to each regulation. I find it hard to believe that restricting drilling within 300 feet of a cutthroat trout stream is going to limit much at all unless cutthroat trout territory is not designated in a resource that is accessable to everyone. I do object to the industry's current scare tactic advertising.

• June 19, 2008

  10:56 a.m.

  Suggest removal

  HankRearden writes:

  Does anyone else think that Ritter has finally realized that he must run for re-election someday? His policies and picks for important seats like the PUC are long on environmental activism and short on industry expertise. Colorado is about split on Reps and Dems but not on the need for responsible low cost energy supply. Those of us that want our energy at a low cost are a huge majority.

• June 19, 2008

  11:34 a.m.

  Suggest removal

  beatrice writes:

  The industry has been drilling at a breakneck pace since 2001 (record numbers of drilling permits were issued for the last three years). Where is our price relief? They are fighting these rules because they might put a tiny dent in the record PROFITS the industry has been earning ever since natural gas prices went through the roof. It's not about the customer and it never was. It's about MONEY!

• June 19, 2008

  1:01 p.m.

  Suggest removal

  Diff writes:

  The Golden rule prevails-
  Them that have the Gold - Make the Rules.

  SASQUATCH Your are certianly creative in your thinking -
  "the NEW Misery Index" ?

  What hole did you pull that out of?
  I can guess...but would rather not

• June 19, 2008

  2:09 p.m.

  Suggest removal

  soccermom writes:

  Just what did VP Cheney accomplish with his Energy Task Force that formed our National Energy Policy? Put the blame where it belongs-not on our local officials. Did Cheney push for better fuel economy?

  What about the Energy Policy Act of 2005 that exempts oil and gas producers from certain requirements of the Safe Drinking Water Act? Do you think it's a good idea for coal bed methane to be leaking into people's wells like it is in Southern Colorado? The oil shale extraction process that Shell is working on in NW Colorado would require huge amounts of water and energy to extract and process the organic marlstone.

  I'm not complaining about the price of oil, I drive a nice old small car a few days a week. Don't use air conditioning. If I have to scale back futher to get our country on the right track I will. Willlingly.

  The oil and gas industry needs to be held accountable for the damage they do to the environment. Economic interests in agriculture and tourism need to be preserved. Landowner rights need to be protected. Enough is enough, they have the leases, they need to respect the land.

• June 19, 2008

  4:22 p.m.

  Suggest removal

  emanon writes:

  Given the fact that the economy is currently down do we really want to try and raise the prices of oil even further? As the price of oil goes up more oil becomes economically viable to extract. If we want to reduce the impact the oil wells have on the environment then we need to find a way to reduce the price of oil, and so reduce the number of wells doing drilled.

  I'm sure that this sort of thing looks very good to the environmentalists among us, but I can't see it actually doing anything to protect the environment in the long term. Oil will always damage the environment either through drilling or through large SUVs driven through the center of Denver. We need to find ways to reduce our dependency on oil, and this takes money. Rather than spend money on developing and enforcing more laws to restrict the extraction of oil we need to spend that money on researching ways to prevent the need to extract that oil in the first place. Only then will we have a chance at preserving our environment.

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