Friday, October 4, 2019

Shale Law in the Spotlight – UPDATE: Overview of Recent Oil and Gas Regulatory and Legal Developments in Colorado

Written by Chloe Marie – Research Specialist

This article will provide an updated and brief overview of some recent legal changes and developments in the state of Colorado.

Adams County, Colorado approves changes to the county’s oil and gas regulations

On September 3, 2019, the Adams County Board of Commissioners amended the county’s oil and gas regulations as a result of the enactment of Senate Bill 19-181. Board Chair Steve O’Dorisio declared in a statement that “our staff has been hard at work creating a set of regulations that is fair to the industry but also provides for the safety of our residents.”

Advocacy groups ask Colorado District Court to reopen the case over the lifting of the City of Longmont’s municipal ban prohibiting the use of hydraulic fracturing

In November 2012, residents of the City of Longmont voted to add Article XVI to Longmont’s home-rule charter expressly prohibiting the use of hydraulic fracturing for oil and gas extraction as well as the disposal of fracking waste within the city’s limits. The Colorado Oil and Gas Associated later sought from the District Court in Boulder County a declaratory judgment and a permanent injunction against Article XVI alleging that the Colorado Oil and Gas Conservation Act preempted local regulations. Advocacy groups including Our Health, Our Future, Our Longmont; the Sierra Club; Food & Water Watch; and Earthworks were allowed to appear as intervenors in support of Article XVI.

On July 24, 2014, the District Court ruled that the Colorado Oil and Gas Conservation Act preempted Article XVI of the City of Longmont’s home-rule charter concluding that there was an “operational conflict between state law and Article XVI.” The Longmont residents and intervenors appealed the District Court’s decision to the Colorado Court of Appeals. The Colorado Court of Appeals later referred the case to the Colorado Supreme Court.

On September 21, 2015, the Colorado Supreme Court agreed to hear the case and consider whether “home-rule cities are preempted from promulgating local land-use regulations that prohibit the use of hydraulic fracturing in oil and gas operations and the storage of such waste products within city limits when the Colorado Oil and Gas Conservation Commission regulates hydraulic fracturing within the state.” On May 2, 2016, the Supreme Court affirmed the District Court’s decision and ruled that “the inalienable rights provision of the Colorado Constitution does not save Article XVI” from preemption by state law.

In light of recent legislative changes in Colorado, on August 13, 2019, the same advocacy groups and prior intervenors in the City of Longmont v. COGA case filed a motion before the District Court in Boulder County to reopen the case stating that “the law and public policy have now substantially changed” since the enactment of SB 19-181 on April 16, 2019. These parties, therefore, seek a lifting of the permanent injunction against Article XVI.

As described in a prior Shale Law in the Spotlight article, this legislation provides local governments with the authority to license and control oil and gas development projects without any limitation from the Commission regardless of whether these projects may have statewide impacts. In addition, the legislation addresses preemption by stating that both the state and municipalities have land use authority over development with the most stringent requirements, whether they are state or local, prevailing.

The intervenors argued that “[t]here is no language in SB 19-181 prohibiting local governments from implementing moratoria or bans against fracking within their jurisdictions, particularly where the local government aims to protect and minimize adverse impacts to public health, safety, and welfare and the environment” before adding that “if the legislature intended to prohibit local governments from banning oil and gas operations within their jurisdictions, it would have clearly said so.” In addition, the intervenors pointed out that, as a result of the enactment of SB 19-181, “Article XVI of Longmont’s Municipal Charter is no longer in operational conflict with the [Oil and Gas Conservation] Act.”

Weld County, Colorado establishes new Oil and Gas Department to handle oil and gas drilling applications in the County

On August 5, 2019, the Weld Board of County Commission officially opened the new Weld County Oil and Gas Energy Department (OGED) that is responsible for the permitting and regulating of oil and gas drilling activities as well as enforcing land use regulations in the County.

Weld County Commissioner Chair Barbara Kirkmeyer declared that “this new department will provide clarity for the energy industry when it comes to permitting and serve as a central location for residents who have questions for the energy industry or want to get more information about drilling activity in Weld County.”

According to a Denver-based media report, the creation of this new oil and gas department “comes at a time when tensions between state energy regulators and Weld County have ratcheted up, as county officials make it clear that they intend to use the additional local authority granted to it in Senate Bill 181 to ensure oil and gas production continues apace.”


Additional Resources:

This material is based upon work supported by the National Agricultural Library, Agricultural Research Service, U.S. Department of Agriculture.

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