Wednesday, January 2, 2013

UPDATE: State proposes new oil and gas rules

Posted By on Wed, Jan 2, 2013 at 5:21 PM

UPDATE: Mary Talbott, a Colorado Springs resident who has watched the city's oil and gas regulation process like a hawk, has analyzed the proposed Colorado Oil and Gas Conservation Commission rules and takes issue with several points in an e-mail to us. Among them:

1. The proposed rule doesn't mandate water testing if wells aren't available in the vicinity, and it doesn't require that monitoring wells be drilled.
—Talbott wants water testing mandated.

2. The proposed rule essentially doesn't require water to be re-sampled if water was tested within 18 months prior to drilling the production well or an injection well, which is used to dispose of waste from the drilling process.
—Talbott's take: "It appears to me that the COGCC assumes that no contamination or changes in the condition of water can occur in 18 months or less. To assume that there has been no change is unreasonable, and this section should be deleted."

3. Water testing results, under the proposed rule, are to be posted to the COGCC website "or through another means announced to the public." The proposed rule also requires the COGCC to provide the test results to the Local Government Designee, a local official who oversees oil and gas activity, "upon request."
—Talbott says, "Under all circumstances the test results should be posted on the COGCC website on the documents page for the appropriate well...." She also says the LGD should be given the report automatically and not have to request the results.

4. The proposed rule on the distance between wells and homes and high-occupancy buildings is stricter than the existing rule, which requires 350 feet in most cases.
—Talbott says that's not good enough. "The proposed changes to the setback rules do not go far enough to protect people," she says. "Given the information that continues to emerge about the health impacts of air emissions, the setbacks proposed ... are inadequate."

———ORIGINAL POST MONDAY, DEC. 31, 5:09 P.M.———


The required distance between homes and drilling rigs would grow, and underground water supplies would require pre-drilling tests (as well as tests after the drilling operation shuts down), under proposed rules issued today by the Colorado Oil and Gas Conservation Commission (COGCC).

The state agency says if adopted as proposed, the updated rules would be the most stringent in the nation.

It's likely the rules will have an impact on how oil and gas exploration will take place in Colorado Springs, because COGCC rules preempt most local rules, including those related to water quality and setbacks, and City Council members have expressed a desire to hold off adopting its drilling ordinance until the state addresses certain issues.

Council approved the ordinance on first reading Nov. 27. After many residents expressed disdain with the decision, Council postponed its second reading until a work session is held on Tuesday, Jan. 15, from 3 to 6 p.m. at City Hall, 107 N. Nevada Ave. Council would then vote on the proposed ordinance at a meeting later in the month. However, that might get held up if Council wants to wait to see what the state does.

The issue is hot because Ultra Resources of Houston bought 18,000 acres of the Banning Lewis Ranch on the city's east side in 2011, and has been waiting for the city to adopt rules for drilling so it can find out what lies below. Ultra thinks the productive Niobrara Shale, which extends through northern Colorado and southern Wyoming, reaches into El Paso County.

The state's proposed rules will be reviewed by COGCC commissioners on Jan. 7, 8 and 9 at the Sheraton Denver Downtown Hotel, 1550 Court Place, starting at 9 a.m. each day. The commission is comprised of people across Colorado with expertise in environmental wildlife protection, agriculture, soil conservation, oil and gas production and regulatory oversight.

The commission may accept the proposed rules as written or modify them or pursue entirely different options.

Here's the news release:

State oil and gas regulators today completed groundbreaking proposals for groundwater protection and the reduction of drilling impacts near homes for consideration next week before the nine-member Colorado Oil and Gas Conservation Commission.

The draft rules follow months of stakeholder meetings and public participation, including nearly a year of presentations and comment on the issue of how best to balance energy production with the need to minimize impacts on residences from nearby oil and gas development.

The two sets of rules were developed with extensive input from local governments, farmers and ranchers, the environmental community, homeowners, the energy industry, homebuilders, mineral owners, environmental health specialists and business leaders. COGCC staff has spent much of 2012 engaging these stakeholders in order to develop rules that protect the public health and environment while providing the flexibility needed to allow for production of energy that all Coloradans depend upon in everyday life, creates and sustains thousands of jobs and is critical to the state’s economy.

“These proposed rules reinforce Colorado’s role as a national pacesetter in the comprehensive and progressive regulation of oil and gas exploration and production,” said Matt Lepore, director of the COGCC, the state’s regulatory agency that staffs the Governor-appointed Commission. “These proposals contain mitigation standards unprecedented nationally and mark yet another step forward in fashioning a model regulatory framework that strikes a balance that’s right for Colorado.”

“At the same time, we understand that our draft rules will leave no one set of interests completely satisfied, and provide various targets for those who want to see it done differently,” Lepore said. “And yet, we expect most everyone who participated will see elements and concepts in these proposals that they helped initiate and push forward.”

Components of the proposals include:
—The new rules will require operators to meet enhanced mitigation, notice and outreach requirements when drilling near residences beginning at 1,000 feet. Setbacks in previous rules of 350 feet (urban) and 150 feet (rural) will now be 500 feet statewide.
—New measures to limit impacts may include pit-less drilling, steel berms and underground liners, strict dust and lighting controls and capture of gasses to reduce odors and emissions.
—Operators must engage in expanded notice and outreach efforts with nearby residents and conduct additional engagement with local governments about proposed operations.
—Operators must conduct sampling of water wells near drilling sites both before and after drilling activities to ensure drinking water aquifers are protected. This would make Colorado the only state to require sampling both pre- and post-drilling.
—Operators cannot operate within 1,000 feet of buildings housing larger numbers of people, such as schools, nursing homes and hospitals without a hearing before the Commission.

We tried to reach the Colorado Oil and Gas Association for a comment, but couldn't reach anyone. When we hear back, we'll post again.

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