STILL, BABY, STILL: Falling oil prices sink urgency to revisit Colorado, Aurora fracking regs

AURORA | Officials at Houston-based ConocoPhillips plan to suspend drilling efforts in Aurora this year amid a drastic drop in crude oil prices, following the lead of an energy industry slowdown nationwide.

“We’ve suspended our drilling temporarily, but there’s a lot of other work going on,” said Jim Lowry, a spokesman for ConocoPhillips. “We’re going to be completing oil wells that have already been drilled … We anticipate requesting permits throughout the year as we look and learn from what we’ve done during the last two years.”

That air of uncertainty during some progress is mirrored statewide, where the governor’s 21-member panel has yet to reach a consensus on how much local control cities should have over the industry’s activities.

“Trying to see what compromise could emerge from the commission and what will go through the Legislature is near impossible,” said nonpartisan pollster Floyd Cirulli, citing the state’s divided Legislature this year that consists of a Republican Senate and a Democratic House. “The most likely scenario is that not much will be accomplished.”

Todd Hartman, a spokesman for the Colorado Oil and Gas Conservation Commission or COGCC, also hinted the commission would not be dealing with any controversial issues in 2015.

“The commission will be addressing potential floodplain regulations in the spring. These are potential rules to help address issues related to the September 2013 flooding,” he said in an email.

The biggest developments for how the state regulates the oil and gas industry in 2015 may even have already happened. At the beginning of January, the COGCC passed tough new penalties for operators who violate state regulations.

Those allow the state to fine operators up to $15,000 a day who are in violation of the state’s oil and gas regulations. Last year, the state Legislature approved the increase beyond the initial limit of $1,000 per day. The commission also removed a statute that limited the maximum penalty the state could impose on operators to $10,000.

Peter Gowen, an enforcement officer with COGCC, said the amount of the fines, which vary from a few hundred dollars to thousands, depend on their potential impact on environment.

“If the operator fails to report its monthly production, which is a paperwork violation, under the new penalty structure, that would be a $200 penalty,” he said. He said that’s compared to a more adverse impact like a large spill on a containment site, which could cost the operator thousands of dollars a day if corrective action isn’t taken.

“In order to get the adjustment down, they have to cooperate with COGCC,” he said.

The COGCC also revamped its website this year to make it easier for residents to file complaints against oil and gas operators online and to track the agency’s progress in handling them.

Ciruli said though it’s hard to predict what will happen with oil and gas in the Legislature, it’s likely the larger issue of local control could go to voters when it comes to drilling. Ciruli said it could be on the 2016 ballot, where voters would decide.

He said if the issue does go to voters in 2016, it’s likely that some local control initiatives would pass.

“We’re a local control kind of state,” he said.

Last year before the governor’s committee was created, U.S. Rep. Jared Polis, a Democrat, came close to getting two local control initiatives on the state’s 2014 midterm ballot. That question would have offered more control over drilling in their towns and would have required oil and gas wells to be set at least 2,000 feet away from homes.

The issue of local control has been hotly contested in Aurora, as well.

After the Aurora City Council approved new local oil and gas regulations that allow for taller vapor towers, among other concessions to the city’s primary operator ConocoPhillips, residents who live near a growing number of fracking sites contested the changes and chided the council for not hearing more from the public.

Now city council members are considering whether to create a more powerful board with the power to approve or deny oil and gas permits, which would be the first of its kind in the state and would operate similarly to the city’s planning commission.

Some council members have argued that the existing oil and gas committee, comprised of citizens, city staff and representatives from the industry, which has been in place since 2012, is too informal.

“It sounds like a wish-washy thing we have here,” said Aurora City Councilman Brad Pierce, chairman of Aurora’s Planning, Economic Development and Redevelopment Policy Committee, at a Jan. 13 meeting. He pointed to the fact that the city’s current oil and gas committee doesn’t even post its meeting minutes online.

Other council members said they’re skeptical a formal committee could do much more than an informal committee. Ultimately, the state has the ultimate authority to regulate oil and gas drilling, while the city can only regulate the land use impacts such as truck traffic.

“If we do have a new board, what are they advising on?” asked Councilwoman Marsha Berzins.