After Years Of Simmering Tug-Of-War, Colorado Dems Eye Action On Oil And Gas

Photo: Oil And Gas Drilling Near Homes | Pump Jack In Frederick - AP
A pump jack works in a recently constructed residential development in Frederick, Colo., Aug. 16, 2018.

Colorado’s new Democratic majority has vowed to make big changes to how companies drill for oil and gas. Tension between drillers and residents have bubbled for years and culminated in a failed statewide ballot fight last fall over the distance between oil and gas wells and homes and schools.

Critics also say the state oil and gas regulator ought to more closely scrutinize companies for health and safety.

Meantime, the industry says it abides by all regulations, some of which are the strictest in the country. In fact, they argue urban drilling goes through multiple review processes with local, county and state officials. Developers often adopt extra measures such as quieter drill rigs, additional air or water monitoring or pipelines to reduce truck traffic.

All parties in the debate were locked in a holding pattern under former Gov. John Hickenlooper, but Gov. Jared Polis is expected to take a different approach. Some Democrats want 2019 to be the year that significantly changes the regulation of oil and gas companies.

There’s more than activists or oil and gas companies with their eyes on the state capitol. The Front Range cities of Lafayette, Superior and Erie have all enacted drilling moratoriums to wait and see what rules the legislature adopts in 2019.

Environmental Groups Cautiously Optimistic

There’s an open field behind Lowell and Margie Lewis’ modern ranch home in west Greeley. For years they enjoyed the view out their back porch of birds and other wildlife in the open terrain. Then, in 2017, an oil and gas company moved in.

“It’s an industrial site back there. Just here plopped in the middle of our neighborhood,” said Lowell Lewis.

Many residents of the Triple Creek neighborhood spoke out against the 22-well site and filed their protest with Greeley city council. When that didn’t work, they went to the Colorado Oil and Gas Conservation Commission.

“It was obvious to me that they’re here to politely listen to people tell them what they’re doing wrong. And then go about their business,” said Lowell Lewis. His wife Margie added that “their business seems to be to approve oil and gas sites. Pretty much no matter what.”

Photo: 2019 COLEG Oil And Gas | Lowell and Margie Lewis - GHood
Greeley residents Lowell and Margie Lewis stand on their back porch. Behind them is the well pad infrastructure for Extraction Oil and Gas’ Triple Creek development, completed in 2017.

Environmental advocates, like the Lewises, want state regulators’ top priority to be health and safety. The idea has even had its day in court. Rather than focus exclusively on health, the recent Colorado Supreme Court decision said that the COGCC must balance health and safety with efficient development of minerals.

It’s a frustrating situation for many advocates because companies can follow all state and local rules and can still drill and as close as 500 feet near homes.

Colorado Rising was the advocacy group behind the failed statewide ballot issue that sought more distance between wells and homes. Spokeswoman Anne Lee Foster said concerns ranged from “water pollution to air pollution… [to] explosions.”

“It’s a massive issue to tackle,” she said.

Ultimately Foster worries the state’s new Democratic leaders will “make political calculations as opposed to really standing up for their constituents. And this might be one of those issues that falls to the political wayside [due to] lack of political will.”

The energy industry worries about the complete opposite — Democrats going too far. “Dan Haley, president and CEO of the Colorado Oil and Gas Association thinks that “elected leaders who are there now have that responsibility to govern responsibility and to not overreach.”

He added that companies have and will continue to work with communities to ease drilling concerns. He points to 2018 when companies agreed to new restrictions on how close they can drill near schools. Collaboration has limits though, Haley said, and industry will fight any legislation that threatens production or jobs.

Democrats Say Change Is Coming

Democrats will have a difficult needle to thread on oil and gas issues, that’s why they say they’re taking their time before unveiling legislation.

“Our bills now have a fighting chance, we have to make sure that we do it right,” said Democratic Sen. Mike Foote of Lafayette. He has pushed for tougher regulations in previous years, and is one of the handful of lawmakers involved in negotiations this session. “In the past, the oil and gas bills that I introduced, were introduced for a specific reason. I thought that they faced uphill battles, and in fact they did, but we still had to push the issue forward.”

Democrats are leaning toward one large comprehensive bill. It’s expected to include more local control, a regulatory change of mission to make health and safety the top priority and the elimination of the charge to foster energy development.

Not on the table is an increase to the setback distance between oil and gas wells and homes. Democrats feel that would be tone deaf after voters rejected the same policy last November. Still, some in the industry and many Republicans fear that these new ideas could actually be worse.

Republican Sen. John Cooke of Greeley, in the heart of oil and gas rich Weld County, worries that Democrats don’t care if they shut down the industry. “And so if they make it difficult for oil and gas, they’re going to pack up and say, you know, what, the business environment much better in North Dakota, Texas, Oklahoma. We’re gonna leave the state.”

Taking into account the hundreds of millions of dollars the oil and gas industry adds to the state budget, and the good paying jobs, Cooke thinks “we’re cutting off our nose to spite our face.”

Photo: KC Becker 4 HV 20190102
Incoming Colorado House Speaker KC Becker at the Capitol Wednesday Jan. 2 2018.

Democratic Speaker of the House KC Becker from Boulder said her party doesn’t want to put the industry out of business, but now that they’re in charge they’re ready to move things forward.

“You know, oil and gas basically had veto power over anything that we wanted to do to modernize oil and gas statutes,” she said. “This is one of those issues where because there was so much pent up frustration and so little that happened for so long. The sides are pretty far apart.”

Republicans aren’t involved in the discussions about upcoming legislation, so it’s likely to be a strictly partisan vote. Senate Majority Leader Steve Fenberg of Boulder thinks passing a comprehensive update would ultimately help the industry — it could prevent extreme ballot initiatives that companies have to spend millions to defeat.

“I think they want reform because the biggest problem for them right now is that there’s no confidence in what the future will be,” said Fenberg. “People don’t know if they’ll have a job in a year because they don’t know what the regulatory landscape will be or if there will be another ballot measure that we’ll go even further than what a lot of people would want to go. So, it’s in their interest I think to negotiate and to come up with something that’s common sense.”

If anything stands in the way of this legislation, it will be the state Senate. Democrats only have a two seat majority, which gives the energy industry the opportunity to sway moderate or politically vulnerable senators.