Shale Daily / NGI All News Access

Colorado's New Distant Drilling Setbacks Could Have Economic Impact

Over some industry opposition, the Colorado Oil and Gas Conservation Commission (COGCC) Monday approved final setback requirements for oil and natural gas wells. Industry representatives criticized the action as "going too far," and potentially hurting the state's economy.

COGCC late last month were unable to resolve lingering issues and delayed its action until Monday's session, during which the panel voted 8-1 to establish much longer statewide setback distances of up to 1,000 feet (see Shale Daily, Jan. 28).

"We do not believe this new rule properly acknowledges either the complexities or the impacts to a diverse array of citizen stakeholders," said Tisha Schuller, CEO of the Colorado Oil and Gas Association (COGA). Ultimately, Schuller said, the new setback requirements could adversely impact farmers, ranchers and mineral rights owners, along with various business owners and residential builders.

After a provisional nonbinding 7-2 vote in early January, COGCC agreed to meet again Jan. 24, during which it tried but failed to complete the new setback rule, which everyone agreed would have a significant impact on exploration and production (E&P) operators, along with a new water sampling rule that COGCC finalized a day earlier (see Shale Daily, Jan. 11).

"The current contentious dialogue about oil and gas development exposes a great disconnect between our reliance on oil and gas resources [in Colorado] and our willingness to support its production," Schuller said.

COGA's major concern centered on the new statewide expansion of setbacks to 500 feet (rural) and 1,000 feet (high occupancy); it had endorsed the current shorter setbacks (350 and 750 feet, respectively).

COGA supported "a more holistic approach" backed by a coalition of E&P operators, such as Anadarko, Encana, Noble and PDC Energy. In addition to the shorter setbacks, it supported establishing an "urban mitigation zone" and respecting the rights of private landowners to negotiate private contracts with operators.

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