Colorado Plan To Focus Oil Rules On Safety Advances

Mar 5, 2019

Updated March 6, 2019 at 9:16 a.m.

A Colorado Senate committee has advanced a bill that would overhaul oil and gas regulations to give local governments more authority over industry operations.

The Senate Transportation and Energy Committee voted 4-3 early Wednesday to send the bill to the chamber's Finance Committee.

Democratic Senate Majority Leader Stephen Fenberg, a bill co-sponsor, says it's a common-sense approach to dealing with frequent conflicts over health and safety.

Opponents say it could lead to a virtual ban on drilling in some areas and cost jobs.

Drilling sparks frequent political battles, especially in fast-growing communities north of Denver, which overlap the rich Wattenberg oil and gas field.

The proposal would charge the Colorado Oil and Gas Conservation Commission, which regulates the industry, with protecting people and the environment first, not promoting energy production.

Updated March 5, 2019 at 8:53 p.m.

Supporters of a plan to overhaul Colorado's oil and gas regulations told lawmakers Tuesday that the measure is a flexible, common-sense approach to dealing with frequent conflicts over health and safety.

Opponents said it goes too far and could lead to a virtual ban on drilling in some areas. A state Senate committee held the first hearing on legislation backed by majority Democrats that would dramatically change the way Colorado oversees the industry.

It would change the state's top priority from promoting oil and gas to protecting human health and safety and would give local governments authority over the location of new wells, a power now held by state regulators.

Oil and gas drilling sparks frequent political and court battles in Colorado, particularly in the fast-growing communities north of Denver, which overlap the rich Wattenberg oil and gas field.

Tuesday's hearing before the Senate Transportation and Energy Committee was the first of several before the sweeping measure gets final votes in both chambers. Opponents of the bill —  including oil and gas field workers — and supporters held separate rallies before the hearing.

It was crowded outside the state Capitol as industry groups spoke out against Senate Bill 181. Colorado Oil and Gas Association president and CEO Dan Haley criticized the bill's sponsors, saying the industry has so far been left out of the discussion.

"They crafted their legislation in secret and stood shoulder to shoulder with those who tried to put us out of business. This is not how we do business in Colorado. This is not the Colorado way," Haley said to applause from the crowd.

The hearing continued late Tuesday with hundreds of people signed up to testify either in person at the statehouse or via video link from a half-dozen sites around the state.

Senate Majority Leader Stephen Fenberg, one of the measure's sponsors, told the committee that the proposal would set out a new mission for the Colorado Oil and Gas Conservation Commission, which regulates the industry, to protect people and the environment first, not promote energy production.

Jeff Robbins, acting director of the commission, said the agency already has some authority to protect health and safety but that the measure would do more.

"I think this legislation amplifies health and safety over and above where it is now," he said.

Tracee Bentley, executive director of the Colorado Petroleum Council, told the committee that the measure goes too far.

"It all but guarantees the industry could not operate in certain jurisdictions," she said. It would send a message that "Colorado is closed for business."

Weld County Commissioner Barbara Kirkmeyer, whose county is in the heart of the Wattenberg field, accused Democratic lawmakers of ignoring officials in energy-producing regions when they wrote the proposal.

She said the last time Colorado significantly tightened oil and gas rules a decade ago, drilling in Weld County slowed to a crawl, property values plunged and thousands of jobs disappeared, both in oil and gas and in industries such as restaurants that depended on energy workers.

Democratic Sen. Mike Foote, a committee member, responded that a deep national recession caused the job losses, not regulation.

Erin Martinez, who survived a 2017 house explosion blamed on a leaking natural gas line, spoke in support of one provision in the measure that would require the state to publicly post the location of pipelines.

The blast killed her husband, Mark Martinez, and brother Joseph Irwin and destroyed the Martinez's home in Firestone. Investigators said the gas came from a pipeline that was severed nearby.

If the couple had known the location of the line, they never would have bought the house, Erin Martinez said.

The original story continues below.

Colorado's Democratic-controlled Legislature took the first step Tuesday toward an overhaul of state oil and gas regulations, pushing ahead despite objections from Republicans and industry representatives who say the changes are being rushed.

The Senate Transportation and Energy Committee held the first hearing on a bill that would dramatically shift the role of state oil and gas regulators. It would make human health and environmental protection their highest priority, not energy production, as it is now.

The bill would also give local governments significant authority to regulate the location of new wells. Currently, only the state has that power.

The text of the bill was released late Friday, and the Tuesday hearing represents an unusually quick turnaround.

Industry representatives asked for a delay, and Republicans said Democrats are hurrying the process to limit debate.

"It is unprecedented for a piece of legislation this large to be heard in committee just a few days after it has been introduced," Colorado Republican Committee Chairman Jeff Hays said Sunday.

The Colorado Oil and Gas Association and the Colorado Petroleum Council said the bill is complicated and lawmakers need to consider it carefully.

"No good can come out of legislation that is revealed on a Friday night and rushed through the legislative process," they said in a joint statement.

House Speaker KC Becker said Monday no interest groups saw the bill before it was released, but industry leaders were briefed on the outlines and offered comments.

"They provided a few and I think they're going to be providing more in the next few days," she said.

Hundreds of opponents of the bill — including oil and gas field workers — as well as supporters held separate rallies before Tuesday's hearing.

Oil and gas drilling sparks frequent political and court battles in Colorado, particularly the fast-growing communities north of Denver, which overlap the rich Wattenberg oil and gas field.

The tide turned in November when Democrats wrested control of the state Senate from Republicans, giving them a majority in both houses of the Legislature and the power to shake up industry regulation.

Newly elected Gov. Jared Polis, a liberal Democrat who succeeded the more centrist Democrat John Hickenlooper, said he supports the changes outlined in the measure.

The far-reaching bill would reorganize the Colorado Oil and Gas Conservation Commission, which regulates the industry. The number of industry representatives would be reduced, and commissioners with expertise in environmental protection and public health would be added.

It would also rewrite the rules for "forced pooling," a process that allows an energy company to extract oil and gas owned by multiple parties — even those who object — and then distribute the profits among them.

Currently, regulators can approve forced pooling requested by one party. The new legislation would require more than half the mineral owners to agree before regulators issue a force pooling order.

Copyright 2019 Associated Press. All rights reserved. KUNC's Matt Bloom contributed to this report.