American Oil and Gas Reporter - October 2017 - 98

ConventionSection: Colorado Oil & Gas Association

Questions Of Local Control
Still Loom In Colorado
By Dan Larson
Special Correspondent
DENVER-Efforts by local governments in Colorado to exert control over
oil and natural gas development, in some
cases in direct violation of state law, are
concerning for operators and the association that represents them, reports the
group's leadership. It is an issue that is
changing the way companies operate in
Colorado's Denver-Julesburg Basin, reports
Dan Haley, president and chief executive
officer of the Colorado Oil and Gas Association.
"We see it as a problematic trend in
several communities in northern Colorado," Haley says. "Discussion and collaboration to avoid legal conflicts would
likely provide better results."
As COGA prepares for its annual
meeting, scheduled for Nov. 9, at the
Marriott City Center in Denver, the shadow
of a tragic accident from April continues
to influence operator interactions with
communities and the policies of the state's
political leadership, Haley offers.
In response to such concerns, the industry must redouble its efforts to inform
and educate its neighbors, maintains
COGA Chairman John Mummery, Rockies area director at BP Lower 48. "Denver
has become a major hub for oil and gas
innovation nationwide. Key to this innovation is how we engage with local
and state leaders to ensure our production
is clean and safe," Mummery reflects.
"By our dialogue and actions, COGA
members help ensure our ultimate goal-
successful oil and gas operations in Colorado-is realized."
Colorado's producers are confronting
a variety of issues, he acknowledges, but
the association is meeting them head-on.
"It is a challenging time for the oil and
gas industry, but COGA and its member
companies are working hard on several
fronts," Mummery reports. "Colorado's
oil and gas industry is on the cutting
edge of technology innovation, including
improved operator efficiencies and the
application of data analytics throughout
the oil and gas value chain. We are also
98 THE AMERICAN OIL & GAS REPORTER

committed to strengthening our safety
practices and working closely with our
oil and gas communities across the state."
Haley says COGA remains concerned
about what it considers a heightened
community awareness of the presence
and potential hazards of buried flowlines
and gathering systems in areas that have
hosted oil and gas operations and where
new wells and facilities are proposed.
That awareness intensified last spring
after two people were killed in an explosion at a home in Firestone, Co., that investigators traced to an improperly abandoned flowline. Since then, the location
and status of flowlines and their proximity
to homes, schools and other buildings
has drawn the attention of opponents and
the media, Haley notes.
"A late-session bill creating flowline
maps for the entire state did not make it out
of the legislature, but we will likely see
something similar next year," he predicts.
In the meantime, several local governments have passed or are considering rules
to require operators to provide maps of
the underground infrastructure within their
boundaries, Haley says. In August, Governor John Hickenlooper issued a sevenpoint policy program to prevent another
such incident (see accompanying story).
The governor's action followed an urgent request by the state within days of
the April explosion for operators to provide
information about the location and status
of all flowlines under their control (AOGR,
June 2017, pg. 32).
Erie Odor Ordinance
In September, a new ordinance took
effect in Erie, Co., targeting nuisance
odors from oil and gas operations, local
media reports indicate. Erie is a town of
18,000 residents located 25 miles north
of Denver. An operator found guilty of
violating the ordinance could be fined
$2,650 a day and ordered to contain the
odor.
According to press accounts, the city
has been notified by one operator that it
deems the ordinance a violation of due
process rights, vague and difficult to
prove, and in conflict with an operator

agreement already in place between the
company and city.
"The ordinance applies something
called 'two reasonable noses' to allow
residents to file a complaint that brings
out the police, who then try to confirm
the odor," Haley describes. "This is one
of those things clearly designed to target
oil and gas, but there are plenty of odor
sources that may unintentionally be
lumped into this new local ordinance."
Erie also passed rules calling for companies to map flowlines in the city, Haley
notes. "We attended its meetings and had
discussions so the city understood our
concerns," he recounts.
A Closed Process
The city council in Thornton, Co., a
town of 118,000 residents 11 miles north
of Denver, passed revisions to its development code on Aug. 22. According to
the regulations, operators of existing oil
and gas sites within 500 feet of a residence-as well as in instances in which
city zoning approves the development of
new residences-must conduct lighting
and noise management studies and meet
the city's signage requirements.
New development faces a much stricter
set of rules, Haley assesses. "We have
several pressing concerns with the regulations passed in Thornton, starting with
the process," he conveys. "It is one stakeholder meeting with exceedingly limited
opportunity for comment. When the
process is not open, you end up with bad
regulations."
COGA cites several areas of concern,
beginning with the fact that the rules increase setbacks to 750 feet, far beyond
the 500-foot setback minimums in state
rules, and include setbacks from residential
developments that are only proposed and
not yet built, he says. "Local governments
cannot enact regulations more stringent
than state law," he adds.
The regulations also mention that an
operator may apply for a waiver in the
case of an operational conflict or technical
infeasibility. "Both of those indicate preemption by state law because the Colorado
Oil & Gas Conservation Commission is

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