Colorado’s oil and gas fields are booming. Nearby residents fear for their health and safety. Democrats control the governorship and both chambers of the legislature, and pressure is mounting on them to resolve the bitter conflict between activists and the fossil-fuel industry once and for all.
The year is…2014.
In our fast-paced and turbulent political present, five years may feel like a lifetime ago. But when the Colorado Legislature adjourned in 2014 after having failed to reach a compromise on the pressing issue of oil and gas extraction, it set off a chain reaction of events that have shaped much of the state’s recent political history. Spurned by lawmakers, activists led by then-U.S. Representative Jared Polis sponsored a pair of ballot initiatives that year to strengthen environmental protections, then controversially agreed to withdraw them. A task force convened to address the issue went nowhere. Court battles raged. The industry even successfully fought to amend the state constitution to make future anti-fracking initiatives less likely. And at long last, frackers and fractivists faced off on the ballot in November 2018, in a $50 million showdown over Proposition 112 and Amendment 74. Both measures failed.
For all the fury of the past five years, state law governing oil and gas development remains essentially unchanged from when the curtains fell on the 2014 legislative session. The industry is still producing at record levels, with thousands of new well permits pending approval. Communities along the Front Range still have little to no control over the heavy industrial extraction operations happening right in their back yards. Colorado’s climate is still growing warmer and drier as global greenhouse gas emissions continue to rise.
Once again in full control of the state legislature, Democrats are now aiming to do what they could not in 2014: fundamentally reform the way the state regulates oil and gas drilling, for the first time in almost seventy years. Exactly how far they’ll go — how much control they’ll cede to local governments, what environmental standards they’ll require state regulators to enforce — could dramatically affect Coloradans living in the shadow of the state’s oil and gas boom, and the bottom lines of the powerful corporations that make up the fossil-fuel industry.
At least two legislative efforts are taking shape at the Capitol: one in the Senate, led by Mike Foote of Longmont, and the other in the House, led by Speaker KC Becker of Boulder. Both represent communities that have been on the front lines of Colorado’s fracking wars — as did Polis, who moved from Congress to the governor’s mansion this year thanks in part to his environmental record and ambitious green-energy goals.
In many of those communities, skepticism and bitterness over years of inaction and dashed hopes run high. Some activists — veterans of the battles that have been fought in courtrooms, town halls and city council chambers across the state for the past decade or more — have given up hope that meaningful change will emerge from a political system in which the fossil-fuel industry has long wielded so much influence.
“It’s frustrating, because we’re having the same conversations that we did five years ago,” says Lafayette activist Cliff Willmeng, who founded the anti-fracking group East Boulder County United in 2012. “Back then, we were pointing out that the oil and gas industry’s role in Colorado politics is just a function of corporate power, which is utilized to make sure that the vast majority of people are disenfranchised.”
If legislators are to finally break the cycle of failed compromises and unfulfilled promises this year, they’ll have to rewrite laws that have been on the books for decades — the longstanding foundations on which Colorado’s oil and gas operators have built their multibillion-dollar empires. To satisfy activists’ demands, they’ll have to shift the balance of power away from the industry and toward residents that the law has long left powerless.
Compared to many other Coloradans who have been impacted by oil and gas drilling, Jean Lim was lucky. As a mineral-rights owner in the Wildgrass subdivision of Broomfield, she received notice of a proposed drilling project when state law might otherwise not have required her to be notified at all.
“We went to our mailboxes and saw a lease offer and said, ‘What is this?’” says Lim, a co-chair of the community activist group Broomfield Concerned. “We didn’t even know we owned our mineral rights.” The letters that she and her neighbors received in June 2016 concerned a proposal by Denver-based Extraction Oil & Gas to drill more than a hundred horizontal wells underneath their properties in northeast Broomfield.
The residents soon began a years-long saga that has become all too familiar to many in Front Range communities as Colorado’s oil and gas industry has expanded dramatically over the past fifteen years.
Beat by beat, the story is nearly always the same. Homeowners in a neighborhood on the edge of town receive letters informing them of a nearby drilling proposal, typically one or more “well pads” with dozens of wells to be drilled at each site. They learn more about the risks and harms of fracking — the constant noise, odors and traffic around drill sites, the industry’s long history of spills and explosions — and worry about what the project could mean for their health and safety. Before long, these unassuming suburbanites find themselves becoming unlikely activists, forming groups like Broomfield Concerned, Erie Protectors, Longmont ROAR and East Boulder County United. They lobby their city councils, their legislators, and state regulatory boards like the Colorado Oil and Gas Conservation Commission to address their concerns.
None of it is enough.
“The city immediately said, ‘Our hands are tied,’ as far as being able to control where the pads are located, or if the project goes forward within the city,” says Lim. “We’ve been to the COGCC numerous times; they say, ‘We’re bound by our mission statement.’ We’ve been to the state legislature. It’s very frustrating.”
“Complete powerlessness,” says Lizzie Lario, Lim’s neighbor in Broomfield and a fellow activist. “To play by the rules, to do it the right way — we’d go to our city, go to our legislators, go to the state, and every single time, we’d get shut down.”
What Lim, Lario and so many other community activists soon come to learn is that Colorado law prohibits “local control” of oil and gas operations, leaving city and county governments almost entirely unable to influence where and how drilling can occur within their borders. Much of the state’s legal and regulatory framework for fossil-fuel extraction was written decades ago, when drilling operations tended to be smaller, less disruptive and farther away from dense residential areas.
As Colorado’s population swelled in the mid-2000s, new technologies like horizontal drilling and fracking led to a massive expansion of drilling across the oil- and gas-rich Wattenberg Field, which stretches across 2,000 square miles between Denver and Greeley. The so-called shale revolution reshaped fossil-fuel production across the country, but only in Colorado did the revolution take place on the doorstep of a major metropolitan area and within its fast-growing exurbs. All at once, the unstoppable force of the Front Range’s population boom collided with its multibillion-dollar oil and gas industry, and state politics have been engulfed by the fallout ever since.
Local control is sure to top the list of oil and gas reforms that Democrats propose this session at the Capitol. Polis campaigned on the idea throughout 2018 and reiterated his support in his first State of the State address in January. Communities, he said, “have a right to have a voice when it comes to industrial activities within their borders that affect their quality of life.”
But exactly how much of a “voice” will the legislature be willing to give cities like Broomfield? In states that allow local control of oil and gas operations, the level of authority granted to municipal governments can vary widely. In 2014, courts in New York ruled that municipalities could ban fracking outright — though in practice, that was rendered moot by a statewide ban enacted later that year. In high-producing oil and gas states like Pennsylvania and California, cities are able to use their zoning authority to limit where new wells can be drilled, but their powers are often murky, and subject to legal challenges from the industry. And activists fear that unless local control is combined with stronger regulations at the state level, the outcomes for residents of smaller Front Range municipalities will be the same.
“The industry will come in and try to buy out local city councils,” says Anne Lee Foster, a spokeswoman for the anti-fracking group Colorado Rising. “There will need to be some increase in the statewide floor of protections, so that communities that can’t afford to fight back against the industry don’t get completely screwed.”
As frustrated and powerless as a lack of local control can leave Coloradans feeling, it’s far from the only facet of state oil and gas policy that activists say is heavily tilted in the industry’s favor — perhaps none more so than forced pooling.
The oil, gas and other mineral resources buried underneath privately owned land in Colorado are themselves private property, and these minerals can either be owned by surface property owners or “severed” and owned by a separate entity. When Jean Lim received a letter from Extraction Oil & Gas in 2016, she was surprised to learn that she was a mineral-rights owner — and at first assumed that her rights would give her some degree of control over Extraction’s plans for her neighborhood and the oil and gas reserves underneath her home.
“Our thought was, well, this must give us some power,” says Lim. “We have property rights, and we should be able to challenge the project. And then we quickly found out differently, when we learned about the forced-pooling laws.”
When operators like Extraction prepare to drill new oil and gas wells, they file a state application for a “drilling unit” that combines many small tracts of mineral rights into pools, with royalties to be paid to each rights owner in proportion to their share of the unit’s total acreage. Under Colorado law, if even a single mineral owner agrees to lease their rights to the driller, every other mineral owner in the unit can be force-pooled; not only will the well be drilled without their consent, but they’ll pay a steep penalty on any production royalties for good measure.
“Colorado has some of the worst forced-pooling laws in the country, because there’s no minimum threshold,” says Foster.
Many states, if they allow the practice at all, require a certain percentage of mineral-rights owners to consent before others can be force-pooled — often a simple majority, but sometimes as high as 90 percent — but in Colorado, one rights owner can override the will of dozens and even hundreds of others. Even local governments and school districts that own the mineral rights beneath parks, open space or school properties can be forced into pooling.
Here again, fracking opponents fault the state’s outdated laws. Despite a few slight tweaks over the years, Colorado’s forced-pooling statute dates back to 1951, long before modern drilling technologies revolutionized how the oil and gas industry operates. Rather than drilling vertically beneath relatively small surface areas, operators now drill from super-sized pads from which dozens of horizontal wells can stretch for miles underground in any direction.
For just one of the six well pads planned for Extraction’s Broomfield project, more than 900 mineral owners have been pooled into a single drilling unit. And, as is often the case, the lease offers that the company sent to begin the process three years ago caught most homeowners by surprise. “Everybody just started talking,” says Lario. “It was like, ‘Who is this? What are we being sent?’”
In January, Lim, Lario and other Broomfield residents sued the state in federal court, claiming that its forced-pooling law violates the U.S. Constitution. They are represented by attorney Joe Salazar, a former Thornton state representative who was named the new executive director of Colorado Rising last month. Although the group was formed to place the unsuccessful Proposition 112 on last year’s ballot, under Salazar’s leadership it plans to take a more active role in environmental litigation against the industry and the state.
It’s likely that forced pooling will be addressed by the legislature this session; last year, a Foote-sponsored bill to exempt local governments and school districts from the practice passed the House but died in the Republican-controlled Senate. But activists with Colorado Rising and other groups think it’s unlikely that lawmakers will go far enough. “Our position is that the practice in general is unconstitutional and should be ended,” says Foster.
By establishing local control and overhauling the pooling process, the legislature could help curb what activists say are some of the worst excesses of state oil and gas law. But many Democrats at the Capitol believe that in order to settle the issue for good, lawmakers will have to go deeper.
Fracking opponents have long alleged that the COGCC, which oversees drilling and production across the state, is fundamentally flawed. Its mission statement, as defined by Colorado’s 68-year-old Oil and Gas Conservation Act, tasks the commission with “fostering” the development of the state’s oil and gas reserves “in a manner consistent with protection of public health, safety and welfare.” State courts have long rejected the argument that this language requires regulators to prioritize health and safety; last month, the Colorado Supreme Court issued a final ruling in the so-called Martinez case, affirming that the law instructs the COGCC to “balance” economic development and environmental concerns.
Following the Martinez decision, Democrats — including Polis, who voiced support for amending the COGCC's mission “to prioritize health and safety, as well as the environment” — stressed the need for the legislature to take the matter out of the courts’ hands and change the law itself. And climate activist groups like 350 Colorado have petitioned the governor and legislature to remove the word “fostering” from the mission statement altogether; it’s inexcusable, they say, for the state to be explicitly encouraging the extraction of fossil fuels when it’s already beginning to suffer the effects of warming-induced drought and aridification.
What may seem like small tweaks to obscure statutory language could have vast, far-reaching consequences for how oil and gas policy is drafted and enforced by state regulators — a prospect that alarms the fossil-fuel industry, for whom the status quo has been immensely profitable. Average monthly oil production has increased more than fivefold since 2010, with no end to this soaring growth in sight. There’s no clear answer as to how regulators, much less the courts, may interpret a law that requires them to put health and safety first when considering new oil and gas projects.
Among the most dramatic safety risks posed by industry operations are the spills, fires and explosions that can occur at its facilities, like the deadly blast that killed two men in Firestone in June 2017, or the one that rattled homes near Windsor in December of that year, leaving a worker severely injured. But hundreds of peer-reviewed studies, including several conducted in Colorado, have also concluded that fracking poses chronic risks to both water and air quality and human health. Although previous analyses released by the state’s health department have downplayed these risks, the state’s most comprehensive report to date is due later this year, following a request by Democratic lawmakers that the study be submitted for peer review.
And there are even longer-term risks to consider: When it comes to fracking in Colorado, climate change is the seven-billion-metric-ton gorilla in the room. That’s how much heat-trapping carbon dioxide will be emitted by burning the oil and gas projected to be produced in the Denver Basin between now and 2050, according to a January report from the environmental group Oil Change International. That’s the equivalent of the lifetime CO2 emissions of nearly fifty coal-fired power plants — and it doesn’t even account for the high levels of methane, another potent greenhouse gas, that are directly emitted by fossil-fuel extraction.
In other words, Colorado is on track to produce much, much more oil and gas over the next several decades than its climate can afford. And yet in spite of this scientific reality, it’s rare to hear Democrats at the Capitol talk about fossil-fuel extraction in the context of climate change; instead, they focus on demand-side policies like incentivizing renewable electricity, phasing out coal plants and electrifying the transportation sector. For groups like Colorado Rising, which is monitoring proceedings at the legislature with one eye on a potential new ballot initiative in 2020, that’s not good enough.
“We don’t expect that the legislature will be able to address all of the concerns of the community,” says Foster, “especially in the age of climate change, and the lack of political will that we’re generally seeing.”
Not long after voters rejected Proposition 112 in November, the oil and gas industry professed its openness to less dramatic reforms. “We recognize the defeat of Proposition 112 is not a lasting referendum, and we will work with the newly elected officials and those continuing in office to find a better equilibrium to reduce the concerns associated with the rapidly growing population and oil and gas activity in Colorado,” Anadarko Petroleum CEO Al Walker said in a statement.
Perhaps as a gesture of their willingness to negotiate, industry groups in December heaped praise on a new COGCC rule that extended mandatory setback distances between new wells and school properties like athletic fields and playgrounds. And major producers such as Anadarko have long touted their support of Colorado’s first-in-the-nation rules limiting methane emissions from oil and gas facilities, which former governor John Hickenlooper’s administration enacted in 2014.
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Caught between highly motivated activists and a highly influential business lobby, Democrats face an uneasy dilemma. Activists are sure to be skeptical of any reform package that is sanctioned, even tacitly, by the industry. But rarely, if ever, have lawmakers passed legislation that was explicitly lobbied against by fossil-fuel trade groups like the Colorado Oil & Gas Association. Even in 2014, when Democrats controlled both chambers of the legislature, the industry’s opposition helped seal the fate of the failed compromise bill floated by Hickenlooper.
A longtime critic of both Republicans and Democrats on oil and gas issues, activist Willmeng doubts that any meaningful changes will come out of the legislature any time soon. “You’re likely going to see some placebo legislation that will attempt to generate some political cover for the Democratic Party,” he says. “Because there’s been no shift in the alignment of the party with the oil and gas industry, there’s no reason to expect anything different.”
Whatever the legislature does, it will probably come too late for the residents affected by Extraction’s massive drilling project in Broomfield. Drilling at the first of six well pads could begin as soon as March, and operations are scheduled to last through the first half of 2021. Years of negotiations between Extraction, city government and neighborhood groups have scaled the project down to just 84 wells from over a hundred, and produced a variety of assurances in an agreement known as a Comprehensive Drilling Plan. It’s a compromise, albeit an awfully one-sided one, with many residents still unhappy and fearful about what the project could mean for their livelihoods. That’s the best that communities like Broomfield can hope for — for now.
“It has to be brought into balance,” says Lario. “There has to be some recognition that citizens have no say, no voice, no place at the table. We’ve just been shut out on every level.”