Seven oil and gas companies state support for revised local control compromise

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Fracking equipment. (Photo: MGN Online/SpiroFlo)

DENVER — Seven Colorado oil and gas companies came out in support of Gov. John Hickenlooper’s revised draft legislation that seeks to find a compromise on the issue of local control of the industry in an effort to avoid a fight over ballot initiatives this fall.

The letter, the first indication of broadening support for a compromise from the industry, slightly increases the odds of Hickenlooper calling a special session to pass the legislation ahead of the November election.

The initial compromise legislation floated a month ago, which ceded greater power to regulate but not ban fracking, was agreed to by  the state’s two largest operators, Anadarko Petroleum and Noble Energy, as well as Boulder Congressman Jared Polis, who is funding the ballot initiatives that would enable cities and counties to ban fracking and establish a 1500-foot setback in the state constitution.

After weeks spent struggling to garner broader support for the proposal inside the Capitol and from outside stakeholders, the administration tweaked the bill to protect homebuilders, prompting Colorado Concern, an organization of more than 100 area CEOs, to publicly support the legislation Tuesday.

Now, five more operators have signed on to a letter informing Hickenlooper that they support the revised proposal along with Anadarko and Noble:  DCP Midstream, Great Western Oil and Gas Company, PDC Energy, K. P. Kauffman Company and WPX Energy.

“We believe Colorado has a decision to make and this is the right way to proceed,” the letter states. “The legislative solution that you have put forward will ensure communities continue to have a voice in the regulation of oil and natural gas development, while protecting property rights, and supporting responsible energy development.

“Your proposal will also help avoid ballot measures that, if adopted, would become constitutional provisions that leave no room for negotiation or compromise, regardless of the circumstances.”

The companies, which employ more than 4,200 people and 7,200 independent contractors and represent more than 60 percent of the oil output and 35 percent of the natural gas production in Colorado, also state that their support for the legislative compromise hinges on Polis’s willingness to pull his support for these ballot measures and any others affecting the industry through the 2018 election.

“We support this legislative compromise because it provides an acceptable balance,” their letter states. “It gives communities an appropriate voice in the regulation of oil and natural gas development, while protecting the property rights of mineral owners, farmers, homebuilders and other surface owners. It accommodates competing interests and helps ensure we have the economy we want, the energy we need, and the environment we value.”

The companies signing onto the letter are all members of the Colorado Oil and Gas Association, the largest trade group in the state that came out against the original draft bill.

The group has decided not to take an official position on the revised draft and is instead allowing members take positions of support or opposition on their own, hence Thursday’s letter from the seven COGA members.

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