The Colorado Oil and Gas Association (COGA) late Monday filed a lawsuit in a county district court seeking to invalidate the city of Longmont’s ban on hydraulic fracturing (fracking) within its city limits. COGA told the court the resolution essentially is a ban on oil/natural gas drilling.

COGA’s filing in Weld County District Court contends that state regulations allow fracking, which it argued is required to extract oil and gas from tight sands and shale formations that are the target of oil/gas exploration in the area. Longmont’s voter-approved Resolution R-2012-67 prohibits the use of the drilling technology.

In the November elections, Longmont voters approved a hotly contested ban on the use of fracking within the city, passing a ballot measure (Question 300) by a comfortable margin (see Shale Daily, Nov. 8). Question 300 bans the use of fracking by oil and gas drillers within the city limits, along with banning fracking waste storage in the city confines.

COGA’s lawsuit said this resolution “constitutes an illegal ban on oil/gas drilling” that state laws permit, and it tries to regulate technical aspects of oil/gas operations “in a manner that is preempted by the Colorado Oil/Gas Conservation Act and its implementing regulations,” a COGA spokesperson said.

While Colorado Springs and other jurisdictions have taken similar action, but stayed in tune with state rules focused on the use of fracking, Longmont’s approach is illegal, according to COGA, whose officials said Monday that they expect the district court to overturn the law.

“The hydraulic fracturing ban in Longmont effectively bans oil/gas development,” said COGA CEO Tisha Schuller, while adding that she and her industry members understand Longmont’s citizens’ concerns about safety and their environment. “We hope the lawsuit can be quickly resolved so that we can work constructively with Longmont to address those concerns in a way that does not illegally preclude the safe/responsible development of oil/gas reserves.”

Colorado has a 130-year history of oil/gas development, and northeastern Colorado now has more than 30,000 active wells, 95% of which have been fracked, Schuller said. Most citizens in the state do not know that fracking has been ongoing safely in the state for more than 60 years, she said.

COGA is arguing that Longmont is missing out potentially on tens of millions of dollars in tax revenues at a time when fracking is closely regulated by the Colorado Oil and Gas Conservation Commission (COGCC). “Oil and gas development is a critical economic engine for the state, and it is not possible to safely and efficiently develop the state’s mineral resources under a patchwork of inconsistent local rules, especially since gas and oil reservoirs do not follow local jurisdictional boundaries,” Schuller said.

Colorado towns and the state authorities have been sparring over fracking regulation all year, and Longmont has been one of the latest local jurisdictions to join the ongoing debate about jurisdictional questions (see Shale Daily, Sept. 11).

COGA estimates that Longmont’s oil/gas minerals have a value of up to $500 million, excluding royalties and taxes. Thus, the producers’ group argues that the city could receive up to $100 million in royalty payments, and because the city owns about 90% of the mineral rights, the taxpayers are losing access to as much as $90 million in royalties.

“For each well not developed in the city limits, Longmont and the many other taxing districts in Boulder and Weld counties forfeit revenue,” COGA said.