DENVER – Two Colorado Democrats on Friday filed a bill aimed at bringing more transparency and state oversight to the oil and gas industry, in light of a recent deadly home explosion caused by an abandoned, uncapped well.
The push comes toward the end of Colorado’s legislative session, which is set to end next Wednesday.
Gov. John Hickenlooper called for more oversight over the industry in a news conference Wednesday, saying the location of the 54,000 Colorado oil and gas wells and lines “should be a matter of public record.”
“I don’t think it’s unreasonable to want to know where those lines are,” Hickenlooper said. “I’m not compelled that it’s got to be the state that controls that, but I think every county should want to know.”
Hickenlooper ordered every well and flowline within 1,000 feet of occupied residential and business building be inspected by oil and gas companies in a set number of days, in addition to the call for public transparency.
The bill filed Friday by Rep. Mike Foote, D-Lafayette, and Rep. Steve Lebsock, D-Thornton, aims to put oversight in the hands of the state oil and gas commission and local governments by mapping all facilities and flowlines in the state.
If it passes by the end of Wednesday and is signed by Gov. Hickenlooper, the Colorado Oil and Gas Conservation Commission would get more power in overseeing oil and gas operators and how they are mapping and keeping track of their existing and future wells and facilities.
If approved, the bill (House Bill 1372) would require every oil and gas operator in Colorado to make significant changes in their reporting methods to the state.
First, they would be required to notify the conservation commission’s director and each local government where facilities or wells are located of the location of each subsurface facility the operator has installed, owns, or operates.
They would have to distinguish between new and old facilities when reporting, and report the facilities within a yet-undesignated period of time.
The operators would also have to distinguish between whether the facilities are active, shut in, or abandoned – and make an effort to locate any subsurface facilities that they installed, owned or operated regardless of whether they originally constructed the facility, or whether it is active, shut-in, or abandoned.
The state oil and gas commission director would then be required to post the information and maps in an easily-searchable format broken down by local jurisdiction.
The oil and gas operators would also have to provide local governments with “good-faith estimate[s]” of the number of wells the operator plans to drill within the next five years in that jurisdiction.
The map would also have to include on the mapping site its existing wells and related lines and facilities, approved sites, sites the company has submitted applications for and other sites the company has identified for possible development.
“There is a growing consensus that more information sharing between oil and gas operators and state and local governments is essential,” said Rep. Foote, D-Lafayette. “We will be working together with the industry, the governor, state agencies and local governments to make sure we can remove barriers to that information sharing. Our bill is one step in that process. Everyone’s goal is to make sure all Coloradans are safe.”
Lebsock said it was “incumbent” that the state and legislature pass such a bill in order to “promote transparency and reassure families living near oil and gas development.”
The bill passed a quick hearing Friday afternoon in the House State, Veterans and Military Affairs Committee, 6-3, and was sent onto the appropriations committee, which does not meet again until Monday.
Colorado Oil & Gas Association (COGA) officials testified against the bill on Friday, and the industry group issued a statement expressing concern it would be counterproductive.
"While we understand the sentiment behind HB 1372, we believe it would upset - and potentially slow - the thoughtful, collaborative inspection process announced by the state this week," COGA President and CEO Dan Haley said in the statement. "For that reason, COGA testified in opposition to the bill. The Notice to Operators issued by the state ordered oil and gas companies to conduct a statewide inventory, inspection, and testing of flowlines. Active and abandoned flowlines will be marked and capped according to state regulations, and all of this information will be provided to the (Colorado Oil and Gas Conservation Commission) within the next 60 days. This is a complicated, multi-phase process that industry has already begun - and it is one that we support, our industry is committed to operating safely and ensuring the safety of Coloradans. Once complete, the state and its citizens will have a full sense of the results. And we can discuss any appropriate next steps at that time."
The bill’s introduction comes on the same day that the U.S. Chemical Safety Board announced it would be sending a team to examine the Firestone home where the explosion, which killed two people and severely injured another, occurred on April 17.
The independent federal agency makes safety recommendations to the industry and regulatory agencies.
The fiscal impact notes for the bill show the state would spend around $100,000 to implement the changes over the next two fiscal years.
Last year, Inside Energy mapped all of the abandoned wells in Colorado based off COGCC data, which you can see by clicking here or in the map embedded below. It notes that some of the locations of plugged and abandoned wells “may be less reliable.”