Mountain States

Is COGCC Trying To Restart The “Oil & Gas Wars” With Latest Setback Proposal?

Colorado’s voters rejected a de facto ban on oil and natural gas development via extended setbacks by a wide margin in 2018. Nonetheless, the Colorado Oil & Gas Conservation Commission is now leveraging the SB 181 rulemaking process to propose “a 2,000-foot buffer or setback – four times the current standard for urban areas.”

It’s essentially a ban on new oil and natural gas development across much of the state, and as the Colorado Sun reports, a “make-or-break” moment for an industry that, along with rest of the economy, has been hit hard by falling demand caused by the COVID-19 pandemic.

The surprise move aligns COGCC’s recommendations far more with fringe activists, who brought a 2,500-foot setback to the ballot in 2018 in the form of Proposition 112 – and attempted to do so again this year – rather than the voters who resoundingly rejected the measure. Furthermore, the new rule places the start of the setback distance at the edge of the operations areas, not the wellhead. As currently proposed, it effectively makes the setback distance 2,400 feet – nearly identical to Prop 112.

Support for a 2,000-foot setback flies in the face of more than 12 months of COGCC’s efforts to work alongside diverse parties across the state to draft sensible rules that ensure the health and safety of Coloradans. As Lynn Granger, the Executive Director of API Colorado, explained:

“Today, we heard Commissioners make comments that failed to account for the hundreds of other regulations outside of setbacks that are being considered in this rulemaking that will make Colorado’s already safe oil and natural gas industry even safer.”

It also disregards a major Colorado Department of Public Health and Environment study released last year that found oil and natural gas operations do not pose a threat to public health in nearly every scenario at the current setback distance. As COGA CEO & President Dan Haley said:

“There is no record in Colorado of hydraulic fracturing contaminating groundwater, and of the thousands of air measurements that have been taken near Colorado sites in recent years, there is zero scientific evidence to suggest existing statewide setbacks need amending or that they are not protective of public health, safety, welfare, or the environment. The data spoke loud and clear to that fact.”

Call It What It Is: A Ban

COGCC’s new proposal is remarkably similar to Prop 112. And while both measures use the term “setback,” the reality is that they are nothing more than a ban. Prop 112 would have ruled out “more than 80 percent of nonfederal land in Colorado, including the vast majority of acreage in rural and highly oil- and gas-productive Weld County,” the Denver Post reported at the time. In fact, when Prop 112 was proposed, COGCC said that such extreme setbacks would have significant impacts, noting:

“In Colorado’s top five oil and gas producing counties combined, 61% of the surface acreage (94% of non-federal land) would be unavailable.”

According to a CU Boulder economist, Colorado’s oil and natural gas industry supports more than 80,000 jobs, generates $1 billion in state and local tax revenue, and adds $13.5 billion to the state’s economic output.

Are More ‘Oil & Gas Wars’ On the Horizon?

In proposing to dramatically extend setbacks, the COGCC is forgetting both the immediate and medium-term history of the oil and natural gas industry in Colorado and the voters who overwhelming rejected increased setbacks. That includes comments made by the commissioners just a few weeks ago during a Colorado Oil & Gas Association event, where they spoke of the need for “collaboration” and “certainty,” with Chair Jeff Robbins proclaiming:

“I think establishing a regulatory relationship that is workable for each of Colorado’s unique communities and that will also provide some certainty and predictability to industry, that is an exciting time for us, and local governments and I think for industry across the state.”

Yet, seemingly out of nowhere and in the midst of a marathon series of hearings, the commissioners forgot what they said just a few weeks ago and ignored the recommendations of the non-partisan COGCC staff. Even House Speaker KC Becker, one of the primary authors of SB 181, admonished activists for proposing more setbacks and Gov. Jared Polis, announced a truce among industry and activist groups to hold off on more ballot measures, both of whom cited the need to implement SB 181 instead of continued fighting over setbacks.

Unfortunately, the COGCC has ignored all of this.

The view that SB-181 wouldn’t lead to bans or moratoriums was echoed by Becker and Senate Majority Leader Steve Fenberg – two of Polis’ allies in the statehouse. “Fenberg … one of the sponsors of the bill, said it does not amount to a de facto ban on operations, as industry defenders allege,” Colorado Politics reported last year, while Becker defiantly asked:

“What in the bill is going to make those jobs go away? Where in the bill is written ‘moratorium?’ Where in the bill is written ‘ban?’”

But now as the rulemaking process from that law proceeds in 2020, Polis’ personally appointed COGCC commissioners are proposing the exact same kind of setback that ignited the “oil and gas wars” in the first place.

Polis could continue this strategy, which will ultimately lead to the type of fights he claimed he wanted to avoid in his truce this summer, or he could stay true to his word, and ensure the oil and natural gas wars truly are “over” by signaling to the COGCC to stop ignoring the voters of Colorado.

As COGA’s Dan Haley said, that move by Polis, would reflect the will of residents across the state:

“Coloradans overwhelmingly voted down greater setbacks just two years ago, and the state lawmakers who passed Senate Bill 181 consistently said the law wouldn’t create the same type of dire outcomes envisioned by the activists who pushed for greater setbacks. Yet here we are, facing the same blunt and shortsighted approach of Proposition 112.”

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