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Problem Solvers guide to oil and gas Proposition 112

DENVER — It is without a doubt one of the most important issues Coloradans will be voting on in November.

Proposition 112 is an effort by Colorado Rising to restrict new oil gas development — banning any new oil and gas development within 2,500 feet of homes, businesses, occupied structures and environmentally sensitive areas.

Currently, oil and gas development cannot take place within 500 feet of homes and businesses and a 1,000 feet of schools.

For the last several months, the Problem Solvers have been looking at the story from every angle.

Supporters believe the health and safety of Coloradans are at risk. Opponents, including Protect Colorado, believe it will devastate the economy by effectively shutting down the oil and gas industry.

Proposition 112 is technically an initiative, which means the Colorado General Assembly could pass regulations changing the exact language of the measure if voters approve it into law.

A lengthy court battle is also expected if Proposition 112 passes.

History of oil and gas development

Hundreds of millions of years ago, Colorado was an ocean filled with plants and animals.

RELATED: Colorado’s oil and gas history

Eventually, they died and were covered with sand, silt and rock.

With time, all of that pressure basically cooked the plants and animals into oil and gas.

“The oil is a little bit less mature. The natural gas has essentially been cooked more,” said Will Fleckenstein from the Colorado School of Mines.

The state’s oil and gas wells are located in four main areas: The Denver Basin, which includes Weld County; the Piceance Basin on the Western Slope; and the San Juan and Raton basins in the southern part of the state.

Colorado produces about 450,000 barrels of oil every day. Fleckenstein said he thinks the state could eventually produce up to 1 million barrels per day.

The initial drilling goes down about 6,000 to 7,000 feet into the Earth.

“After that, you’re just drilling laterally,” Fleckenstein said. “And now you’re drilling wells laterally as far as 10,000 feet. Then you move the rig off and start the hydraulic fracturing process.”

Fleckenstein said the well can the be active for as long as 20 to 30 years, with the first few years being the most productive.

Economic impact

One of the biggest debates with Proposition 112 is how it would hurt the Colorado economy.

Gov. John Hickenlooper, Denver Mayor Michael Hancock, and a consortium of Weld County mayors have said the measure would be disastrous to the Colorado economy.

Both candidates for governor — Jared Polis and Walker Stapleton — are opposed to the measure.

RELATED: Truth Check on economic impact of Proposition 112

It is true that many new wells would no longer be built if Proposition 112 passes.

The Colorado Oil and Gas Conservation Commission says 85 percent of nonfederal land in Colorado would be unavailable for development.

This study is slightly contracted by a professor at The Colorado School of Mines who says more land will be accessible through horizontal drilling. 

The COGCC estimates 78 percent of surface land in Weld County, a major operator of oil and natural gas, would be off-limits.

However, more than 50,000 active wells exist in Colorado and they would be allowed to still operate.

Those wells will require resources to maintain them and oil and gas operators could still drill horizontally at existing sites.

Oil and gas wells can operate for 20 to 30 years but are most productive in the first few years.

Opponents believe Proposition 112 would cost more than 43,000 jobs in the first year and more than 147,000 jobs by 2030, according to a study commissioned by the Common Sense Policy Round-table. 

Colorado Rising cites a study by the Department of Energy that shows 13,000 existing oil jobs with 9,800 existing natural gas jobs, emphasizing many jobs would be needed to keep up these operations.

Supporters also emphasize the Colorado economy is diversified and oil and gas is not the No. 1 contributor to the GDP.

The Colorado Blue Book, a nonpartisan guide published at the State Capitol, says local governments would see an economic impact first if Proposition 112 passes because they would see less taxes. Those taxes in many counties currently fund schools.

“Limitations on new drilling will reduce local property tax collections,” the report says.

Setback history

How far an oil and gas well can be near a home or business is referred to as a “setback.”

RELATED: History of setbacks in Colorado

In 1985, the Colorado Oil and Gas Conservation Commission created the first official setback.

It said most new wells had to be at least 150 feet away from homes and buildings. That rule was put in place in case an oil rig toppled over.

As oil and gas developments increased, more people started speaking out and wanted them to be farther from homes.

In 1992, the commission made a new setback of 350 feet for high-density areas, including neighborhoods. In 2013, the setbacks become stricter.

The commission moved them to where they are today — where most new wells must be at least 500 feet from homes and 1,000 feet from schools and buildings.

“It’s just trying to make sure we are continuing to regulate the industry responsibly and make sure those setback distances are appropriate,” said COGCC environmental manager Greg Deranleau.

Also, in 2015 the commission created new rules to make oil and gas companies talk with communities earlier in the process when they want to drill new wells.

“One of the big concerns was the local governments are sort of shut out of the permitting process until pretty late in the game and this kind of turned that around,” Deranleau said.

Oil and gas companies can petition the commission to have oil and gas wells closer, but that requires a public hearing and rarely happens.

Also, these rules are for oil and gas wells getting built next to existing homes, schools and buildings.

The commission does not regulate the opposite — homes and buildings being built next to existing wells.

Safety concerns

One reason for Proposition 112 making the ballot is concerns over safety. The Firestone tragedy that killed two in 2017 put intense focus on oil and gas operations.

In November 2017, oil and gas workers were injured and killed in Greeley, continuing the debate on safety.

It remains up in the air, however, if proximity to oil and gas operations poses a risk.

The state concluded in a 2017 study that “the risk of harmful health effects is low for residents living at distances 500 feet or more from oil and gas operations.”

However, supporters of Proposition 112 point to other studies showing an increased risk on topics such as low birth weights. 

Politics and money

It is hard to find a high-ranking public official supporting Proposition 112.

State House Majority Leader KC Becker (D) and Democratic Party Chair Morgan Carroll are the highest-ranking supporters.

From a financial standpoint, the opposition to Proposition 112 is crushing the campaign in favor of it.

Protect Colorado has raised tens of millions of dollars from energy sectors, while supporters have struggled to attract traditional political support.

Bottom line

In communities where oil and gas jobs are plentiful, the measure is likely to be defeated. The industry has spent a lot of money telling workers this could cost employees their jobs.

However, in communities where oil and gas operations are encroaching  on homes and schools, the verdict is still out.

The “setback debate” has motivated families that often stay out of politics. There also remains a question on how Denver and other large cities will vote.

There are no real oil and gas operations in the city at this point. Do residents side with the industry or environmentalists?

If it passes, a lengthy legal challenge, and possible changes through the General Assembly, will likely happen.

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