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New Colorado oil, gas rules take effect; more to come

Judith Kohler
The Associated Press
Aspen, CO Colorado

DENVER ” Colorado’s long-debated oil and gas rules have taken effect in most areas ” but there are more to come.

The rules kicked in on private land Wednesday. The roughly 100 new and revised oil and gas rules carry out laws requiring regulators to give more weight to the environment, public health and safety, and wildlife when they approve oil and gas development.

Changes include new standards for oil and gas waste pits, protection of drinking water supplies and more input from landowners and state health and wildlife experts.



Still unresolved is a handful of issues that task forces are expected to tackle soon. They include how far drilling rigs must be from occupied buildings, buffers around waterways, reclamation of well sites, guidelines for minimizing impacts on wildlife and coordinating with counties that have their own rules.

The state and U.S. Bureau of Land Management will also address enforcement of the state regulations on federal land. They’re expected to update a long-standing agreement on oil and gas development.




Regulators will rewrite one of the new rules to eliminate state wildlife and health agencies’ ability to appeal drilling permits. The industry protested the provision, noting that the agencies’ directors sit on the commission that would decide the appeals.

The Legislature approved the rules despite objections, mostly from Republicans, that they will hurt the industry.

“It’s really great to see Colorado take the lead in protecting what makes Colorado special,” said Michael Freeman, an attorney with Earthjustice who has represented conservation groups in hearings on the rules.

The laws updating the regulations passed the Colorado Legislature by large margins in 2007, the middle of a natural gas boom.

Since then, companies have reduced drilling as gas prices have plummeted and credit has dried up amid the recession. A shortage of pipeline capacity in the Rockies is another obstacle.

The rules written by the Colorado Oil and Gas Conservation Commission, the main regulatory body, have aggravated the situation by creating uncertainty for companies, industry officials contend.

The “specter of the rules” has caused companies to scale back plans in Colorado, said Nate Strauch of the Colorado Oil and Gas Association, a trade group.

The group and the Colorado Petroleum Association, another trade organization, launched an ad campaign last summer attacking the “job-killing rules.”

Asked if the industry will challenge the rules, Strauch said: “We’re focused right now solely on seeing how the rules will be implemented over the course of the next month. Decisions will be made as to where to go from there.”

Drilling permit applications the state received before Wednesday are covered by the old rules. A permit is good for one year.

Theo Stein, spokesman for the Colorado Department of Natural Resources, said the state received 1,100 applications in March, the most ever in one month. He said companies likely were trying to beat the start of the new rules.

Last year, Colorado issued a record 8,027 oil and gas drilling permits, nearly double the 4,323 approved in 2005. Most of the permits were for natural gas.

State officials expect the number of permits issued this year to drop, but say only about 3,500 permits approved last year have been used.

Strauch said many of the outstanding permits are held by large companies.

“What we’re really concerned about in the short term is the small companies that don’t have the capacity to plan ahead,” Strauch said.

Michael Saul, an attorney with the National Wildlife Federation, said he hopes that over the next several months as the new rules take hold, all the interested parties will decide what works and come up with innovative ways to develop oil and gas while protecting the environment.

And Saul said he hopes that “when gas prices come back up and pipeline capacity increases and the boom ramps up again, which it will, it happens in a more environmentally sensitive way.”


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