Oil and Gas, Environmental Groups Clash in First Round of SB 181 Rulemaking

Oil and Gas, Environmental Groups Clash in First Round of SB 181 Rulemaking
Chase Woodruff
The so-called 500 Series rulemaking was supposed to be a simple, relatively uncontroversial starting point for a new era of Colorado oil and gas policy. It's turned into anything but.

The first of up to a dozen separate rulemaking processes required by Senate Bill 181, the landmark energy legislation passed by Democrats in the Colorado Legislature earlier this year, it involves changes to the Colorado Oil and Gas Conservation Commission's hearing procedures — known as 500 Series regulations in the agency's rulebook — that include authorizing administrative law judges to conduct some of its business while commissioners move on to drafting and enacting other, more important health and safety regulations. This stage was scheduled to last just a month, and many expected it to go fairly smoothly.

Instead, the two-day hearing on the proposed rules held this week by the commission became yet another battleground in the long-running conflict among state regulators, powerful oil and gas interests and the coalition of environmental and community groups determined to weaken what they view as the industry's domineering influence on the regulatory process.

Industry groups, from trade associations like the Colorado Oil and Gas Association and the Colorado Petroleum Council to individual operators such as Anadarko and ConocoPhillips, raised a host of objections to the new rules proposed by the commission. Environmental groups countered, and some continued to press for a full moratorium on new drilling permits until improved health and safety rules are enacted. Mineral-rights owners and local governments wanted their say, too.

After more than twelve hours of presentation, rebuttals, deliberation and revisions during hearings on June 17 and June 18, COGCC commissioners postponed a final vote on the proposed 500 Series rules changes until the commission's next monthly hearing, scheduled to begin July 31.

"I've taken 24 pages of notes," commissioner Brenda Haun, a Weld County cattle rancher appointed by Governor Jared Polis to the seven-member body last month, said near the end of the June 18 hearing. "There is no way that I can possibly feel like I've done justice, looking at the [rules] at the end of two long days, and feel like I'm doing a reasonable job."

"I want you to get it right," COGCC Director Jeff Robbins told commissioners. "I want you to feel that you're in a place where you're comfortable making your vote. If that means that we're not going to get to a vote [today], that's perfectly fine."

In addition to considering the proposed changes, on June 18 the commission voted to approve a stakeholder process convened by operators and mineral-rights groups to settle lingering questions relating to the reforms made by SB 181 to the pooling process, which allows drillers to assemble multiple tracts of mineral rights into a single unit.

Many of the most consequential rulemakings required by SB 181 — including new regulations governing flowlines, abandoned wells, air quality, "cumulative impacts" and more — are scheduled to take place over the next year and beyond, according to a timeline released June 17 by the COGCC. But anti-fracking activists have continued to argue that the law's requirement to prioritize health and safety means that permitting should be put on hold while new rules are developed.

“SB 181 precludes new drilling permits until rulemaking ensures the public interest and environment is not being sacrificed. The Series 500 rulemaking is hopelessly out of sequence,” Phil Doe of activist group Be the Change charged in a statement.

Added 350 Colorado director Micah Parkin: "COGCC commissioners seem more interested in expediting the permitting process by focusing first on the 500 Series rather than doing the necessary research and rulemaking to ensure that Coloradans' health and safety are protected."

The commission's next hearing is scheduled for July 31 and August 1 in the Terrace Room at the University of Colorado Denver School of Public Affairs.
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Chase Woodruff is a staff writer at Westword interested in climate change, the environment and money in politics.
Contact: Chase Woodruff