Expanding the Separation of Oil, Gas and Real Estate

State ballot initiatives related to energy sector could chill real estate

Last week saw the certification of two high-profile initiatives for Colorado’s ballot in November. Initiative 97 would increase the setback requirement for oil and gas drilling to 2,500 feet from any occupied structure or government-designated vulnerable area. Initiative 108 seeks to counteract 97’s effects by allowing a right of action for private property owners to seek government compensation for a reduction in fair market value resulting from a law or policy.

The Colorado Oil and Gas Conservation Commission published a report in July estimating that 51 percent of Colorado’s land would be off-limits to oil and gas drilling, should Initiative 97 pass.

Taking federal land out of consideration would increase that figure to 84 percent, according to the report. And such a significant impact on oil and gas development could also chill Colorado’s real estate market, because a setback requirement also means residential property can’t exist in the same “circle” determined by the required distance.

To read this story and other complete articles featured in the September 3, 2018 print edition of Law Week Colorado, copies are available for purchase online.