Colorado’s oil and gas industry entered a new era on Nov. 23 as the state’s Oil and Gas Conservation Commission approved its first slate of rules that give priority to “public health, safety, welfare, the environment and wildlife” under a recent law that reordered regulation of the sector. The latest iteration of regulations, which had last been updated in 2008, had been in development for months.
The five-member commission in a unanimous vote finalized the so-called 200–600 and 800, 900 and 1200 series rules. Each set is aimed at advancing a shift in the state’s governing priority toward its fourth-largest producer of greenhouse gases from “fostering” oil and gas production to “regulating” it, as commanded by the 2019 statute. The rules delve into details such as working relationships between the commission and local governments as well as mechanisms for protecting wildlife and habitats, setbacks from homes and other buildings for industry infrastructure and limits on the practice of releasing unburned gases as waste or surplus.
Jeff Robbins, COGCC’s chairperson, congratulated himself and his colleagues for their work on its “mission change” rules. “The rules not only meet the spirit and mandates of SB 19-181, but they were done so with a unanimous vote and largely with consensus from all sides,” Robbins said. A spokesperson for the Colorado Oil & Gas Association also lauded the new regulations. “Colorado now undoubtedly has the toughest oil and natural gas development regulations in the country, which further protect the environment and ensure that the molecules of energy produced here locally are cleaner than most anywhere in the world,” Dan Haley, COGA’s president, said in a statement.
But the commission’s work is not without critics, particularly those who insist that the state must do more to confront the climate crisis. “We had proposed rules that would have set annual greenhouse gas reduction targets for the oil and gas sector,” Nate Bellinger, an attorney with Oregon-based Our Children’s Trust, which participated in the COGCC’s rulemaking, said. “Those were never given any serious consideration.” While the new rules “do a pretty good job” of beginning some evaluation of greenhouse gas emissions from the sector, he said, “there is a lot more that needed to be done.”
“There’s really nothing in the rules to ensure that greenhouse gas emissions from the oil and gas sector will decline in the coming years, which is contrary to what the General Assembly has said is necessary,” Bellinger continued. He was referring to HB 19-1261, which established goals for reducing Colorado’s releases of gases that warm the atmosphere. The specific targets for those state-wide cutbacks are 26% by 2025, 50% by 2030, and 90% by 2050, all relative to 2005 emission levels.
The Colorado Energy Office, in a draft Greenhouse Gas Pollution Roadmap released Sept. 30, emphasizes that implementation of SB 19-181 must “[m]inimiz[e] methane emissions from the oil and gas industry.” The roadmap also unequivocally declared that the 2030 greenhouse gas emission goal can be met only with “deep reductions in methane pollution from the oil and gas industry, which makes up the largest source of non-combustion emissions in the state,” among other measures. “The current policies in place will only achieve about half of those necessary,” Bellinger said.
Other participants pointed out that the rules do pay limited attention to the industry’s greenhouse gas emissions and that Colorado has ways to address them. Matthew Sura, a Longmont-based attorney who specializes in oil and gas matters and environmental law, said that he thinks both COGCC and the Colorado Air Quality Control Commission can impose emission caps. The rules themselves include a data gathering requirement that will obligate operators to collect and report information about greenhouse gas emissions.
Provisions that address the venting of waste and surplus gases will impose some limit on those emissions. Sara Loflin, the executive director of League of Oil and Gas Impacted Coloradans, commended the commission’s work to ban flaring as an “amazing job.” She said that her understanding of the new rules is that flaring will be allowed only “in extreme conditions, when things like downhole issues or pressure dictate that it’s necessary.” Sura said that, in addition to such emergency circumstances, COGCC has left operators only with the option of obtaining a variance in order to engage in the practice as a routine matter. The flaring prohibition puts Colorado in the company of Alaska as the only two U.S. states to impose such strong deterrents to the practice.
The rules governing distance between drilling pads and other facilities and structures and the flaring limits were contentious issues for the commission. Operators must assure that none of their equipment is within 500 feet of a residence under any circumstance and, for all practical purposes, stay 2,000 feet away from homes. The near-universal 2,000-foot setback is consistent with a 2019 study conducted for the Colorado Department of Public Health and Environment that showed residents who live closer than that to fracking wells experience higher than average health risks from volatile organic compounds associated with them.
“In order to get within 2,000 feet of, say, a residential neighborhood, the oil and gas operator would have to obtain the informed consent from every resident and landowner within 2,000 feet of their proposal in addition to consent of the local government,” Loflin said “It’s a hard 500-foot setback.” At the same time, the rules leave the door open, Loflin thinks, to allow industry operations near neighborhoods where local communities are comfortable with it. “I think this is a way to get at the neighborhood drilling conversation and yet allow the industry some variances,” she said.
Interactions between wildlife and operator infrastructure are also a feature of the regulations. Fragmentation of habitat, fencing of infrastructure, exposure to toxic chemicals and water pollution, and increased human presence, noise, and light can all have an adverse impact on animals and plants, according to Colorado Parks and Wildlife. “The rules protect and minimize adverse impacts to wildlife, habitats necessary for all life stages, and seasonal ranges necessary to sustain healthy populations,” Megan Castle, a spokesperson for COGCC, said. “In addition, some of the most imperiled and important species receive specific protections within the rules.” Castle explained that COGCC will consult with CPW to take account of possible specific impacts to gray wolves, which the state’s voters ordered be reintroduced by enacting Proposition 114 earlier this month.
Not all pending applications for oil and gas facility permits will be impacted by the new COGCC regulations, which take effect Jan. 15. Castle said that 4,603 applications are now pending and that any additional requests for a permit received before Jan. 15 must be considered under existing rules.
— Hank Lacey