Oil and water: Will they mix? 

Drilling rigs will move into El Paso County soon, and that's not lost on county residents worried about their water wells.

Last Thursday, the U.S. Environmental Protection Agency reported that hydraulic fracturing, which uses chemicals with water and sand to shake loose fossil fuels from underground rock, likely contaminated groundwater in a Wyoming test well. It marked the first time that fracturing, commonly called fracking, was linked to domestic water-well pollution, raising the stakes in the debate over how far drillers should be allowed to go to mine oil and gas.

"Up and down the Front Range, you have people who bought homes with beautiful views," says Charlie Montgomery, energy organizer of the Colorado Environmental Coalition, a group of organizations active in the fracking debate. "And to have a big drilling rig in their backyard — people can see that's going to be something that's not going to be pleasant for them, particularly where open spaces, open skies, clean air and clean water are so important."

Five days after that EPA news, the Colorado Oil and Gas Conservation Commission (COGCC) approved a new rule requiring drillers to disclose fracking liquids — but allowing them to withhold some information as "trade secrets," without any routine administrative review to validate the claims.

The Colorado Oil and Gas Association, an industry group, termed it the "strongest hydraulic fracturing rule in the country," sure to "provide our communities with the tools they need to ensure groundwater is protected."

And COGCC director David Neslin says in an interview the rule strikes a "responsible balance" between public disclosure and protection of business interests.

"I believe it's the right rule for Colorado, our families and our neighbors," he says.

But Wyoming, for one, requires a state review of trade-secret claims. And Montgomery says a true environmental victory would be seeing the industry switch to non-toxic fracking materials.

The citizens

In 2001, Jeff and Phyllis Cahill built a home a quarter-mile from Colorado Springs' eastern city limits. Though they'd been looking for quiet, within a year were targeted for a buyout to make way for Utilities' massive water pipeline project, the Southern Delivery System.

Utilities eventually decided the Cahills' house wasn't needed, but the ordeal put the couple on alert for issues surrounding Banning Lewis Ranch, a 23,000-acre eastern swath whose 1988 annexation was long cited as a chief reason for the pipeline.

Now, with the developer belly-up, Ultra Resources of Houston owns 18,000 acres of the ranch and wants to drill there. City Councilors and El Paso County commissioners have imposed moratoriums, allowing time to draft regulations. But the moratorium in the county, where drillers have filed 2,200 oil and gas leases since 2009, will expire next month. (Commissioners have scheduled a Dec. 29 public hearing on proposed rules, but no date is set for acting on them.)

Already, the county has allowed Ultra to drill three test wells — named Brutus, Olive Oyl and Spinach — east and southeast of the city, on State Land Board land. At those sites, groundwater lies from 54 to 270 feet below the surface, county records show.

The county's proposed regulations call for groundwater monitoring. But the Cahills, who have one of the 19,000 groundwater wells in El Paso County, are skeptical that companies will comply and that rules will be enforced. So they recently paid $625 for a lab analysis of their water to serve as a baseline, for comparison's sake if a well is drilled near them later.

Their well reaches nearly 1,000 feet into the Arapahoe Basin, one of four underground water formations in the county. The Cahills worry that when drillers bore through those formations to reach oil and gas deposits thousands of feet beneath, cement casings surrounding the pipes will crack, opening the door to water pollution.

"All these chemicals they're putting into the ground," Jeff Cahill says, "we potentially could have antifreeze in our water. [Drillers] rape all the resources and take them away and leave us with a mess to clean up — land that can't be sold, water that can't be drunk."

In its Wyoming test well, the EPA found benzene, toluene, ethylbenzene, xylene and gasoline range organics, which are carcinogenic. Meanwhile, debate has continued in Pennsylvania and New York about whether discharge from gas drilling there has polluted streams and rivers, and whether groundwater contamination is possible, too.

There's little debate that if toxins did get into an aquifer, they could befoul groundwater for hundreds of years.

"Once you pollute a water supply, there's very little remedy available to you," Montgomery says. "A company can't go in and clean it up and make it whole."

The water providers

Colorado Springs Utilities is required to serve Banning Lewis Ranch under the annexation agreement, in which the annexor relinquishes the land's water rights to the city forever, except for 2,000 acre feet of groundwater on the south end. That water, about 652 million gallons, is to be split between the city and annexor.

But Utilities, still building the SDS pipeline, hasn't heard a water request from Ultra, says spokesman Dave Grossman. He says the city doesn't know how much is needed, because "fracking is new to our area, so we don't have past data for planning purposes." Ultra did not respond to a request for comment for this story, but Montgomery says 1 million to 5 million gallons is used per frack.

If the 326 million gallons to which Ultra would have access under the annexation agreement isn't enough, and the company doesn't want to buy water from Utilities, Cherokee Metropolitan District, which serves the 18,000-customer Cimarron Hills enclave east of Powers Boulevard, is open to the idea of selling water, manager Sean Chambers says. Five years ago, Cherokee lost its use of several wells in the Upper Black Squirrel Creek Ground Water Management District, east of its service area, after illegally exporting water from the basin to its customers.

Chambers now wonders if that water, which Cherokee still owns, could be sold to drillers.

"We would consider it, so long as we were assured certain protections and we could confirm our decrees are consistent with what's allowable," he says. "The state is a little unsure ... They don't want this oil bonanza to turn into a water problem."

The regulators

Oil and gas drilling also brings issues associated with surface storage of post-frack water, the source of a serious pollution incident several years ago in Parachute on the Western Slope. There, a man was hospitalized after drinking benzene-laced water from his tap after pollutants seeped into his well. The incident led to a $423,300 fine against Williams Production RMT Co., according to the administrative order.

Annually, the state investigates hundreds of complaints from citizens and actions initiated by its own inspectors. From 2008 through November this year, the Colorado Oil and Gas Conservation Commission received 878 complaints from citizens. It issued 1,104 notices of alleged violations of laws concerning noise, dust, road damage, pollution and other problems, but only 44 administrative orders of consent, which often carry fines or corrective orders.

That gives fodder to those, including the Cahills, who suspect the agency is slow to blame drillers. Among citizens' complaints is a June 2009 issue raised by Marion Wells of Parachute, who complained that "a large amount of water and muck" flowed from a drilling pad onto her property, damaging a spring. The COGCC found it was possible the drilling operation was to blame, but concluded, "Williams Production states it is not responsible. No definite determination of cause can be made."

Shirley Dahl of Keenesburg in Weld County, whose property is flanked by drilling rigs, complained in September 2009 that "when water is placed in a water bottle, she is able to light it on fire." But the COGCC concluded the methane was "of biogenic origin" and couldn't be blamed on drilling.

In June 2010, John Lindell of Wellington, north of Fort Collins, saw a Halliburton tank truck dumping fluids on a county road in front of his house. When he walked up, the workers shut off the flow and rushed to leave, with one saying "it was just water and they were washing off their boots," according to the report. The COGCC found the dump site contained petroleum hydrocarbons such as benzene, and ordered the company to clean up the site. No fine was noted.

The commission is far from lax, insists spokesman Todd Hartman, noting the agency conducted 17,000 inspections in 2010, a 70 percent increase from the previous year. "We believe we have an inspection program that adequately ensures safe oil and gas operations, but we are constantly evaluating this situation," he writes in an e-mail. Considering how the industry is growing, he adds, the agency wants to add more inspectors to its current 15.

The Colorado Oil and Gas Association didn't reply to an interview request for this story. But on its website, the association notes that the industry employs 50,000 people in Colorado and accounts for $24 billion in economic output annually.

Montgomery says the next battle will be over local control. The Pueblo Chieftain has reported that Rep. Marsha Looper, R-Calhan, wants to require a more comprehensive state accounting of oil and gas drilling's water needs. Meanwhile, the Longmont Times-Call says that Rep. Matt Jones, D-Louisville, wants to give local governments more control over the industry, including fracking.


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