American Oil and Gas Reporter - July 2015 - 18

IndustryDigest
development, according to one of the
commissioners.
"This was one of a number of steps
we have taken to simplify and
rationalize the cost of doing business,"
says Board Chairman Jeff Eskelson.
"We have reduced the permit
application to four pages, and posted
flow charts and matrices so operators
know what is due and when.
Suspending the impact fee was the last
big thing that made sense."
The commission approved a
resolution in May suspending the
county's permit fee until Feb. 8, 2016.
The action was taken "in an attempt to
stimulate energy and other
development," which is "experiencing a
significant downturn because of (oil and
natural gas) prices," according to the
resolution.
The amount of the fee is based on a
number of factors and averages more
than $17,000 per new well application,
notes Eskelson.
"We know this isn't a make-or-break
expense for most companies, but there

isn't much use charging a fee if no one
is going to drill," he remarks.
A decline in new development has
been seen and felt in towns and counties
across the Piceance Basin, confirms
David Ludlam, executive director of the
West Slope Chapter of the Colorado Oil
& Gas Association. From a peak of 98
rigs operating in Northwest Colorado in
2009 to fewer than 10 rigs in 2015, the
economic impacts are real, he says.
"People in Rio Blanco County are
familiar with energy development and
they know the importance of being seen
as business friendly," Ludlam notes.
At the northwest corner of Colorado,
Rio Blanco County is recognized for
world-class hunting and fishing as well
as being home to some of the state's
best farming and ranching operations,
Ludlam points out, adding that the
county's outdoors guiding and outfitting
businesses are thriving. The difference
between communities there and in other
parts of Colorado is that Rio Blanco
County residents "recognize that energy
development can and should coexist,"

he says.
That is why the impact fee holiday is
seen as such an important step, observes
Ludlam.
"Taking this step shows great
leadership on the part of the
commissioners," he affirms. "They are
aware of market conditions and where
our basin fits in the big picture. This
signals that Rio Blanco County is open
for business.
"Too often, local governments are
seen as bearing down on energy
producers," he goes on. "It's refreshing
to have commissioners interested in
working with industry to come up with
solutions that work for both sides."
Ludlam says WSCOGA is prepared
to use the hiatus to discuss with county
officials possible alternatives to the
impact fee. Several ideas are up for
discussion. For example, he suggests,
fees might be prorated, based on actual
use of roads, with companies that install
gathering systems and water recycling
paying less than operators who rely on
water hauling. Other possible fee

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18 THE AMERICAN OIL & GAS REPORTER
American Oil and Gas Reporter - July 2015

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