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From homes to oil? 

Andy Jensen and his wife, Stacy, bought and moved into their house in Banning Lewis Ranch last fall, even as the massive subdivision's owners declared bankruptcy. Life has continued as usual since then.

But things could take a dramatic turn if bids for the nearly 21,000 undeveloped acres are finalized, as proposed, on July 28. That's because a Texas oil company, Ultra Petroleum, wants to buy the south 18,000 acres of the 21,500-acre development for $26.25 million — and might want to drill there for oil and natural gas.

"You always hear about it in other people's backyards, and then it's in ours, and it doesn't thrill me," Andy Jensen says. He realizes fuel to power cars, homes and industry has to come from somewhere. But as a biologist involved in environmental projects, and who drives a hybrid car bearing a "treehugger" bumper sticker, he's also acutely aware of the damage potential.

"The fact is, I'm worried about him," he says, pointing to the Jensens' toddler, Enzo, "and the environment for his future. It's all a big question mark in my mind."

That's how everyone is describing the idea of converting a significant portion of the master-planned Banning Lewis Ranch community into a drilling field.

The city can't say much at the moment, because there's been no application filed. Ultra spokeswoman Kelly Whitley tells the Independent it's premature to disclose details of the company's plans. But she acknowledged the company wants to rezone the land to agriculture to accommodate drilling, and that would mean consideration by City Council.

"We've never done a zoning on a drilling operation since I've been on Council," says Scott Hente, who took office in 2003. "Do we probably need to rezone to accommodate that? Yeah. I think it will be a big deal."

Fear factor

Decades ago, drilling on the plains out east might have gone unnoticed. But the Banning Lewis Ranch, annexed in 1988, is part of the city, and controversy surrounding hydraulic fracturing, or fracking, instills fear of environmental degradation.

Fracking is the process of creating small cracks, or fractures, in underground geological formations to allow oil or natural gas to flow into the wellbore and thereby increase production, according to the Colorado Oil and Gas Conservation Commission, which grants permits for drilling operations. In Colorado, the fracking target often is more than 7,000 feet below ground and more than 5,000 feet below drinking water aquifers.

People in other states, including Texas and New York, blame fracking for tainting domestic water wells with unknown toxins and polluting the air with chemicals they say cause nosebleeds, dizziness and nausea. Others worry about more serious health risks, such as cancer, according to the May issue of Discover magazine. A New York Times investigation found that wastewater treatment plants that handled fracking water discharged radioactive liquid into public waterways in Pennsylvania, New York and West Virginia.

Stuart Ellsworth, the commission's engineering manager, downplays such concerns, saying that over 90 percent of the 45,000 functioning wells in Colorado are hydraulically fractured, a technique used since the 1970s. "It's an old science and not new," he says.

What is new, since around 2000, is horizontal drilling, which expands the size and productivity of a drilling field, he says.

While shareholders have criticized Ultra Petroleum for "poor environmental practices," including discharging water with high levels of radioactivity in Pennsylvania, Whitley says the company has been recognized for how it worked with Wyoming to "develop natural resources responsibly" in its drilling operations on Bureau of Land Management land.

Ellsworth says Colorado conducts "a very comprehensive review" of every application. Still, most state permits are granted in less than 30 days, he says.

While Ultra has disclosed chemicals it uses in fracking to Wyoming authorities as required, not all agencies demand it. Colorado doesn't unless a problem arises, Ellsworth says. Nor did the Huerfano County commissioners when they approved a 14,500-foot well recently for a site west of La Veta, about 108 miles south of Colorado Springs.

Environmental activist Chip Kraynyk says despite dozens of Huerfano County citizens asking for environmental controls and disclosure of fracking fluids, commissioners seemed more interested in new jobs. "At the end of all this, [oil and gas producer] Shell essentially got their way," he says.

Springs city planners Carl Schueler and Larry Larsen say changing the use of Banning Lewis Ranch could be complicated, because zoning won't be the only issue. Ultra would probably seek agriculture zoning, but it also likely would need to alter the master plan.

Larsen says the process begins with the company filing a pre-application and meeting with city planners to reach agreement on zoning and master plan changes. The city would take the citizens' pulse, while Springs Utilities and the city's fire, engineering and street departments would be asked for input. Larsen says the agreed-upon plan would be submitted to the city planning commission, which in turn would make a recommendation to Council.

Council's decision would be final, because the City Charter gives the new strong mayor no say in rezoning matters.

Changing the master plan is more complicated, because more changes would be necessary, Larsen and Schueler say. Master plans include precise locations for parks, fire stations, housing developments and commercial districts. Schueler says the city has wide latitude in land-use matters, but the city's planning documents don't cover oil and gas drilling, only mining.

"To my knowledge, we've never had an active oil and gas operation in the city or the county," he says.

Nothing is known officially about Ultra's plans, such as where it wants to drill, how many rigs would be installed, for how long and whether the land would ultimately be used for residential development after the drillers pull out.

Ultra's public affairs office, based in Houston, didn't return the Independent's phone calls.

"Until we understand a lot more about it," Schueler says, "we're shooting in the dark."

Ultra's idea caught Springs Utilities equally off guard. "It's all new territory for us," says Gary Bostrom, who oversees water and wastewater.

Thom Kerr, permit manager with the state commission, says local regulations can get "very complicated," and cities often impose additional safety requirements such as fencing to discourage vandalism, or construction of special roads to handle heavy trucks.

Also, cities should be prepared for some rigs to tower up to 130 feet high, Kerr says.

Jobs, jobs, jobs

Aesthetic and environmental concerns, though, might take a backseat to economics. Oil and gas rigs bring jobs, a top priority for several City Councilors, and 30,000 people here are out of work.

According to the Colorado Oil and Gas Association, Colorado's oil and gas industry employs 50,000 people. In Weld County, which with Garfield County on the Western Slope leads the way in number of wells drilled in recent years, drilling has had a big economic impact, says city of Greeley spokesman John Pantaleo.

Weld has the most wells, at over 10,000, or 40 percent of all wells in Colorado, the state Oil and Gas Conservation Commission reports.

Until now, there's been little interest in El Paso County, where only three permits have been issued, to Pine Ridge Oil and Gas LLC last October.

But the success of the Jake oil well on the Colorado-Wyoming border has sparked greater interest in the Niobrara formation, which underlies several states, including El Paso County. That's why county officials have started rewriting land-use codes to accommodate drilling.

The details remain fuzzy, and that makes the Jensens rather nervous.

"It's weird, and it's scary," Stacy Jensen says. "You don't know what's going on, and people don't have any answers."

zubeck@csindy.com

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