American Oil and Gas Reporter - August 2015 - 117

ConventionSection: Colorado Oil & Gas Association

Debate Over Local Control
Continues In Colorado
By Corinne Westeman

DENVER-A long-running debate
could move closer to conclusion over
the next several months as the Colorado
Oil & Gas Conservation Commission engages stakeholders on the topic of local
input into oil and gas operations.
Colorado Oil & Gas Association Director of Policy & External Affairs Doug
Flanders says the COGCC will be holding
a "robust schedule" of public forums
across the state to meet with community
leaders, interested stakeholders, and operators to discuss how to implement two
regulatory recommendations.
Flanders recalls that in August 2014,
Colorado Governor John Hickenlooper
formed a task force to examine oil and
gas issues as a compromise to get activists
to withdraw their initiatives from the November ballot. Industry opponents had
filed initiatives to increase well setbacks
and to enable local regulators to restrict
development activities (AOGR, September
2015, pg. 183). Those were being countered by one initiative to deny oil and
gas tax revenue to local governments
that banned drilling, and another that
would have required fiscal impact notes
for all ballot initiatives.
In February, the task force issued nine
recommendations, Flanders says. Six
were directed toward state agencies, and
three went to the Colorado Legislature.
Of the six that went to agencies, two-
Recommendations 17 and 20-needed further elaboration and discussion among
stakeholders and the public, he adds.
Flanders says the meetings were scheduled in areas with heavy production activity, such as the Denver-Julesburg Basin
in north-central Colorado, the San Juan
Basin to the southwest, and the Piceance
Basin in western Colorado. In July, Flanders said the meetings were expected to
continue through the rest of the summer
and possibly into early fall.
He says COGA expects state officials
to draft proposed regulations based on the
task force's recommendations and public
comments, and present them to the COGCC
for a vote in November or December.

Working With Words
Both Recommendations 17 and 20 are
fairly short and vague, Flanders describes,
and address local government input into
siting wells and the impacts of development. "There is a lot of discussion left to
be had in defining the exact wording of
these possible regulations," he reasons.
"It is important to make sure we have
communities across the state starting on
the same page."
Flanders says Recommendation 17
prompts the COGCC to define "urban
mitigation areas" and "large scale oil and
gas facilities." It directs the commission
to develop rules that clarify what authority
and procedures should be used to regulate
such facilities to reduce impacts and conflicts with communities.
For instance, under Recommendation
17, an operator could be required to meet
with local government when considering
a well location, and to include notation
of local government approval in his application for a permit to drill (AOGR,
April 2015, pg. 44).
"These recommendations seek to establish a process to ensure a community
and its citizens are informed and cooperating with companies as they are beginning
operations," Flanders affirms. "It will get
into longer lead times, and what exactly
constitutes 'a large scale facility.'"
Flanders guesses that a large scale facility probably won't include a single
well, but multiwell pads likely will be
included in the definition. But, whether
the term will be defined by general size,
number of wells, or other criteria, he
says won't be determined until after the
stakeholder meetings.
As of late July, Flanders said the commission was considering further enhancing
the local government designees (LGDs)
and local government liaisons (LGLs),
with further training to ensure collaboration
among companies, local governments,
and state regulators.
"It is more of a personnel issue than a
new rule," he explains. "How do we get
the LGDs, who work for the local governments, and the state-employed LGLs
trained and working together in a way to

ensure communication is much clearer?
It is an enhancement of the local government process."
As the stakeholder meetings continue,
Flanders says COGA members and staff
will attend to represent industry and help
find reasonable solutions that benefit all
parties. "These discussions are necessary
because you want collaboration between
industry and local governments, to accompany the state's authority," he summarizes.
"Everyone wants to know what this is
going to look like. So, there are many
things that will have to be worked through."

Local Litigation
According to COGA, a district court
judge has granted the city of Broomfield,
Co.'s request to temporarily suspend the
association's lawsuit seeking to invalidate
a voter-approved moratorium on hydraulic
fracturing.
Broomfield sought to have the case
held in "abeyance," pending the outcome
of two "substantially similar" cases that
are under appeal to the Colorado Court
of Appeals, court documents confirm.
Over the past year, the association
notes, district courts have struck down
voter-approved hydraulic fracturing bans
in Longmont, Lafayette and Fort Collins,
Co. The Longmont and Fort Collins cases
are awaiting decisions in the Court of
Appeals.
Both parties agreed Broomfield's and
Fort Collins' initiatives were nearly identical, since each imposed a five-year
moratorium on hydraulic fracturing and
storing associated waste products. However, COGA says it contended a stay of
litigation could be granted only in "the
most compelling circumstances." It also
argued that Blue Chip Oil Inc. and Extraction Oil and Gas LLC, wanted to
fracture wells in Broomfield and were
incurring significant financial losses.
In his ruling issued in June, District
Court Judge C. Scott Crabtree said Broomfield met the necessary requirements, because "substantial resources will be consumed by having to address similar arguments pending in the Colorado Court
of Appeals." Crabtree also said there was
AUGUST 2015 117

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