Wednesday, February 29, 2012

Governor orders formation of an oil and gas task force

Posted By on Wed, Feb 29, 2012 at 4:46 PM


With local government officials causing a dust-up over the state's primacy in overseeing oil and gas drilling, Gov. John Hickenlooper is apparently trying to calm those complaints of local officials being closed out by creating an oil and gas task force.

Problem is, so far there are no local government officials on the panel, only reps from organizations of local officials, such as Colorado Counties, Inc., and the Colorado Municipal League.

El Paso County commissioners had a run-in with the Attorney General's Office earlier this year after commissioners wanted to retain control over groundwater monitoring. Eventually a deal was reached in which the county's local designated representative, assistant county attorney Diana May, will work with state officials in enforcing rules on groundwater testing before and after drilling occurs.

But lots of natives are restless over other issues, including setback requirements of wells from property lines and structures, dust and air pollution and other issues. In a court case in Gunnison earlier this year, a judge ruled in favor of the local officials in imposing regulations. Several bills are floating around the state Legislature that deal with local control as well.

Here's the governor's executive order:

B 2012-002

John W. Hickenlooper, Governor

Cooperative Strategies Regarding State and Local Regulation of Oil and Gas Development

Pursuant to the authority vested in the Office of the Governor of the state of Colorado, I,
John W. Hickenlooper, Governor of the State of Colorado, hereby issue this Executive Order
creating the Task Force on Cooperative Strategies Regarding State and Local Regulation of Oil
and Gas Development

I. Background, Need and Purpose
As oil and gas activity expands throughout Colorado, in large part due to horizontal drilling
combined with hydraulic fracturing that together are launching new shale oil and gas plays,
counties and municipalities ("local jurisdictions") are evaluating whether to adopt their own rules
governing development activities.
The Colorado Oil and Gas Conservation Act, C.R.S. § 34-60-101 , et seq. , charges the Colorado
Oil and Gas Conservation Commission ("COGCC") with fostering the responsible development
of Colorado's oil and gas resources in a manner consistent with the protection of public health,
safety and welfare, including protection of the environment and wildlife. Pursuant to this
statutory directive, the COGCC has broad powers to further the state's interest in oil and gas
development. This includes the power to pass regulations governing development and the
COGCC has comprehensively updated its regulations to address both surface and subsurface
protections. The state's regulations also provide multiple opportunities for local government
At the same time, local jurisdictions have the duty to provide planned and orderly development
within Colorado and have statutory authority to balance basic human needs and environmental
concerns when regulating the use of land within their boundaries. The increased oil and gas
activity that is occurring in new areas and that involves new technology has caused a number of
local jurisdictions to revisit the adequacy of their own regulations.
Colorado case law established the operational conflict rules. Industry, the State, and local
jurisdictions successfully operate within the parameters established by the courts. Occasionally,
however, parties disagree whether a local rule is in conflict with a state rule. Parties hesitate to
pursue resolution in court because proving operational conflict is an adversarial, cumbersome, time consuming, and expensive process. It is in the interest of all parties to seek ways in which
the concerns oflocal jurisdictions, operators, and the State can be addressed collaboratively.
The State, local jurisdictions, and industry share an interest in efficient and effective regulations
that provide for the responsible development of the state's oil and gas resources. As such, the
State and local jurisdictions, in collaboration with the oil and gas industry, seek to fashion
mechanisms through which they can coordinate their efforts and achieve a complimentary
regulatory structure that benefits our economy, health, environment and wildlife.
The Speaker of the House of Representatives and the President of the Senate support this Task
Force and it is hereby established with the following mission and scope and will examine the
many facets ofthese issues and strive to reach consensus on how best to achieve its mission.

II. Mission and Scope
A. The Task Force shall identify and strive to reach agreement on mechanisms to work
collaboratively and coordinate state and local jurisdiction regulatory structures for
the purpose of benefiting Colorado's economy and protecting public health, the
environment and wildlife, and to avoid duplication and conflict of state and local
jurisdiction regulations of oil and gas activities and to help foster a climate that
encourages responsible development.

B. The issues that the Task Force addresses shall include, but not be limited to:
1. setbacks of oil and gas facilities or roads necessary for oil an gas operations
from any building, public road, above-ground utility line, railroad, or water
body, or other restrictions on the location of an oil or gas well and its related
production facilities;
2. floodplain restrictions;
3. protection of wildlife and livestock;
4. noise abatement;
5. operational methods employed by oil and gas activities;
6. air quality and dust management;
7. traffic management and impacts; and
8. fees, financial assurance, and inspection.

C. The Task Force shall explore any and all options that address the issues in
paragraph B and helps clarify and/or better coordinate the regulatory jurisdiction
over oil and gas operations between state and local jurisdictions. Such options
examined shall include, but are not limited to:
1. utilization of local government liaisons and local" jurisdiction designees
regarding permitted oil and gas activities;
2. state training workshops for local jurisdiction representatives;
3. memorandums of agreement, intergovernmental agreements, and letters of cooperation and consent between the state and local jurisdictions;
4. changes to existing laws or regulations; and
5. suggested new laws and regulations.

III. Membership
A. The Task Force shall be chaired by the Executive Director of the Colorado
Department of Natural Resources.
B. Members of the Task Force shall be limited to the following:
1. the Executive Director of the Colorado Department of Local Affairs, or his
or her designee;
2. two members of the Colorado Oil and Gas Conservation Commission as
determined by said Commission;
3. the President of the Board of Directors of Colorado Counties, Incorporated, or his or her designee who must also be a member of said organization;
4. the President of the Board of Directors of the Colorado Municipal League, or his or her designee who must also be a member of said organization;
5. the Chief Executive of the Colorado Petroleum Association, or his or her designee;
6. the Chief Executive Officer of the Colorado Oil and Gas Association, or his or her designee;
7. the Executive Director of Colorado Conservation Voters, or his or her designee;
8. one member appointed by the Speaker of the House of Representatives;
9. one member appointed by the President ofthe Senate; and
10. the Colorado Attorney General or the Attorney General's designee.

IV. Duration
This Executive Order shall continue in existence until the Task Force reports its
recommendations and findings to the Governor, the Speaker of the House of Representatives,
and the President of the Senate but no later than April 18, 2012, unless it is either terminated or extended beyond that date by further Executive Order of the Governor.


We've asked a few local folks, including Board of County Commissioners Chair Amy Lathen, for comments on this latest development.

Here's Lathen's take, via e-mail:

After the exhaustive process that we went through here in El Paso, it looks like the state is working on going through a similar process. Many have commented on how well things have been handled here and I hope that is something on which they can build. This certainly mirrors our Local Government Designee (LGD) process and we have already forwarded the Executive Order to Diana May, our LGD. I'll be checking into the local government possibilities.

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