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Overhaul of Colorado oil and gas rules, stalled by coronavirus, gets going again — on Zoom

The volunteer Colorado Oil and Gas Conservation Commission was supposed to finish the state's Senate Bill 181 oil and gas regulation overhaul before a new paid panel takes over. It’s not happening.

A pickup truck drives toward an illuminated drilling rig very close Highway 66 north of Longmont on June 29, 2019. (Andy Colwell, Special to the Colorado Sun)
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Colorado is in the throes of the most extensive rewrite of its oil and gas regulations in more than a decade, under deadlines now busted by the novel coronavirus pandemic – but regulators are soldiering on with the state’s first Zoom-based rulemaking.

For now the Colorado Oil and Gas Conservation Commission is relying on electronic filings and the video conferencing service that is being widely used – as most of the nation is under shelter-in-place orders – for remote family get-togethers and socially distant happy hours.

The COGCC exercise will be no happy hour as it tries to retool rules to reflect its new mission of regulating oil and gas development “in a manner that protects public health, safety and welfare.”

A screenshot of the April 13, 2020 Colorado Oil and Gas Conservation Commission’s hearing, which took place over Zoom. (via YouTube)

“Obviously this is not how we anticipated the rulemaking on mission change,” said Jeff Robbins, the commission’s executive director.

“We have had successful meetings with public participation,” Robbins said. There are, for example, stakeholder meetings in which the commission staff walks through the draft rules and takes questions. 

“Those meetings can comfortably take place using Zoom,” he said. “I think we can be successful given what we’ve done to date.”

At the April 13 meeting, Commissioner Brenda Haun said “one benefit of Zoom is we can hear from people in all parts of the state.”

The task, however, is big. The COGCC planned to overhaul parts of six sections of its voluminous regulations between April and the end of June to reflect the multiple changes in goals and roles.

Dan Haley

“We are walking into uncharted territory, as we’ve never seen multiple large rulemakings folded together into a single mega rulemaking, like what is being proposed,” Dan Haley, the president of the Colorado Oil and Gas Association, an industry trade group, said in an email.

“At least, that was the case before everything changed with COVID-19 stay-at-home orders,” Haley wrote.  “Given that the world has seemingly hit the pause button on many things, outside of critical daily operational work, we think it’s appropriate to delay the pending rulemakings until we can meet in person and after we get a handle on this global health crisis.”

Haley said that the oil and gas industry is also being hit by a steep drop in oil prices blamed on a combination of a price war between Russia and Saudi Arabia and extremely depressed demand for fuel as a result of the pandemic.

The COGCC is holding a Zoom prehearing conference with stakeholders on April 28. Then, during a Zoom commission meeting on April 29, a decision will be made on how to proceed.

“At that point we’ll know what the world looks like,” Robbins said.

TODAY’S UNDERWRITER

Big issues are on the broader agenda

Under legislation – Senate Bill 181 – passed in 2019, the commission was tasked with updating the rules for flowlines, which collect oil and gas from wells, and adding new rules to analyze alternative sites for drill pads and tanks, as well as the cumulative impact of oil and gas operations.

The commission is also supposed to adopt rules to ensure the integrity of wells and change state regulations to reflect the prime role of local governments in overseeing oil and gas development.

All this was supposed to be done by the nine-member volunteer commission, which includes Dan Gibbs, executive director of the Department of Natural Resources, by July 1 when a new five-member, full-time commission takes over.

Jeff Robbins, executive director of the Colorado Oil and Gas Conservation Commission, speaks to reporters on Thursday, March 12, 2020. One month later, he was meeting the public via Zoom conferencing software. (Jesse Paul, The Colorado Sun)

Meeting that deadline now seems unlikely.  “We are going to see how far we can get,” Robbins said. 

The pandemic, however, remains a confounding obstacle.

Commissioner Liane Jollon, the executive director of San Juan Basin Public Health, the public health and environment agency for Archuleta and La Plata counties, warned during the April 13 meeting that if the disease peaks in her area during May she likely would not be available for hearings.

Erin Overturf, another commissioner, said that as long as she has a kindergartner on her hands full-time she can’t manage eight-hour-long commission hearings. “It is a strange thing to bring up at a commission meeting,” said Overturf, who is deputy director of Western Resource Advocates’ clean-energy program. “These are strange times.”

Whatever doesn’t get done will be picked-up by the new commission. “The professional commission should be more than capable of taking on Senate Bill 181,” Haley said.

Commission has picked away at flowline, emissions rules

COVID-19 IN COLORADO

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Progress was being made before the pandemic. In November, the commission adopted new flowline rules and in December the Air Quality Control Commission passed new regulations to reduce emissions from oil and gas operations.

A compromise draft of well-integrity rules has been developed, aimed at dictating how groundwater is protected and how wells are drilled and hydrofractured to release oil and gas from shale. A hearing on those rules is scheduled for June 10 and 11.

The rest of the rule changes mandated by Senate Bill 181 were left for the 12 weeks before the new commission takes over.

Both industry and community groups have already identified a couple of areas where they are ready to spar over the new regulations.

Senate Bill 181 gave primacy to municipalities and counties, emphasizing local control in evaluating and approving oil and gas projects. 

Under the proposed rules an operator would have to show it had received local approvals before it could file for state drilling permits, but the law also requires the state to do an alternative site analysis for every project.

Industry representatives are concerned that the state analysis would at best be redundant and at worst conflict with local decisions.

“Counties, cities, and towns are the ones with planning departments and zoning protocols that exist to implement a vision for their community and future growth,” Haley said. “It makes logical sense that they would have the greatest understanding of that information when working to identify a drilling location. If through those conversations at the local level, a well pad location is agreed upon, that should represent the basis of a legitimate site assessment process. After all, Senate Bill 181 was ostensibly about local control.”

Drilling equipment is visible along operates at Extraction Oil & Gas’s Hulstrong G Unit 1 site near Colorado 7 and Huron Street in Broomfield on Thursday, April 4, 2019. (Andy Colwell, Special to the Colorado Sun)

But Sara Loflin, executive director of the League of Oil and Gas Impacted Communities, an umbrella organization for local grassroots groups, said a state review of siting decisions is essential because “all local control is not the same.”

Lofin said that while communities like Broomfield and Boulder County have developed rigorous and protective local regulations, there are places like Larimer and Weld counties that are more interested in promoting oil and gas development.

Another likely area of contention is the requirement that drillers provide a cumulative impact assessment of their projects on air quality, water quality, light, dust, noise, odor and traffic.

The rule asks for only a narrative assessment with a quantitative evaluation “if applicable.” 

“We’d like to see a little more precision in that rule,” Loflin said. 

Industry representatives say they are concerned environmentalists will push to extend the assessment to include impacts such as climate change.

“These are big, difficult, transformative rulemakings that even in a normal world require a lot of good faith effort to get to the right spot,” Robbins said.


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