Court rules against couple in drilling-permit case

Residents are not entitled to hearings over applications for permits to drill for oil and gas in Colorado, according to a state Supreme Court decision issued Monday.

Plaintiffs Cary and Ruth Weldon and Wesley and Marcia Kent, along with the Grand Valley Citizens Alliance and Western Colorado Congress, had requested a hearing regarding drilling permit applications near Project Rulison, the site of an underground nuclear detonation in Garfield County. That request was denied by the Colorado Oil and Gas Conservation Commission.

The plaintiffs challenged that denial in district court, but the case was dismissed. The court of appeals then reversed the district court’s action, saying the landowners were entitled to a hearing under a provision of the Oil and Gas Conservation Act that required the commission to grant a hearing on any matter within its jurisdiction.

Monday, the Colorado Supreme Court reversed that appeals court decision, explaining that the lower court had not read the provision on hearings in context. When read in context, it said, the law only requires the commission to grant hearings over what the law calls a “rule, regulation, order, or amendment thereof” — not an application for a permit to drill, as the plaintiffs had wanted.

When it comes to permits, the Oil and Gas Conservation Act gives the commission “broad authority” including being able to “determine who can request a hearing,” wrote Justice Allison Eid, who wrote the opinion. She added that the commission “properly” denied the request for a hearing and instead treated that request as a complaint.

Complaints can be submitted by anyone potentially affected and may in some cases form the basis for the commission withholding approval for an application.

In a dissenting opinion, Justice Gregory Hobbs argued that the denial of a hearing was in violation of the Administrative Procedure Act because it contradicts the “basis and purpose” of the rules governing when and why the commission allows hearings.

Hobbs cited the commission’s rules allowing a hearing on an application only to the applicant, the surface owner or a local government, but said that sometimes — as Garfield County said was the case here — local governments lack the capacity to be able to represent their citizens in such hearings.

“In such a case, the Commission’s rules, as it interprets them, cause it to avoid hearing the interests of the local government’s citizens,” which defeats the stated intention behind allowing local governments to request hearings in the first place, he said.

When this is the case, the local residents should still be allowed to make their case, Hobbs said.

This particular case was further complicated by the fact that the applications in question, which were filed by Encana in 2008, propose drilling three miles from ground zero of a underground nuclear detonation conducted by the federal government in 1969 as an experimental effort to free natural gas.

The experiment failed because the freed gas, maybe unsurprisingly, contained radioactive matter.

In 2004, the commission decided that hearings would be required for any permit applications that proposed drilling within a half-mile of the that blast site.


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