Oil, gas rules clear committee, will be debated by Senate

Landowners’ appeal of permit approvals a point of contention

A legislative committee Wednesday approved a bill authorizing new oil and gas rules in Colorado, clearing them for debate by the full state Senate.

The Committee on Legal Services approved House Bill 1292 on a 7-3 vote after hearing witnesses debate the rules’ applicability to federal land and the appropriateness of letting landowners appeal approvals of permits issued for drilling on their property.

The same committee, composed of House and Senate members, previously had approved the bulk of the rules before sending the bill to the full House, which passed it last week on a 50-13 vote.

The measure covers a wide range of state rules that go far beyond oil and gas operations.

But the debate over the bill in recent weeks has focused on the oil and gas regulations, and whether they impose undue costs and burdens on energy companies or properly balance their interests against protection of the environment, wildlife and public health, safety and welfare.

The Committee on Legal Services is responsible for considering the legality of the oil and gas rules, which were adopted by the Colorado Oil and Gas Conservation Commission in December.

The committee approved the rules without amending them Wednesday, but some lawmakers voiced discomfort about the provisions focused on by witnesses. State Sen. John Morse, D-Colorado Springs, said he hopes the surface owner right to appeal permit approvals to the oil and gas commission can be removed.

Ken Wonstolen, an attorney representing the Colorado Oil and Gas Association, told the committee the provision serves as a disincentive for landowners to reach surface-use agreements with energy companies earlier in the process. State Rep. Ellen Roberts,
R-Durango, fears the provision could have the opposite effect, with industry not being willing to reach a fair agreement until the hearing stage.

David Neslin, acting director of the oil and gas commission, said the provision doesn’t apply to surface-use agreements. It only lets surface owners appeal on matters such as those involving possible rules violations or health, environment and safety matters.

Stan Dempsey, president of the Colorado Petroleum Association, worried about possible rules conflicts due to the lack of an agreement with the federal government over implementation of state rules on federal land. Neslin said if an agreement isn’t reached in time, the state could delay the May 1 target date for those rules to take effect on federal land.


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