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Colorado Nearing Compromise on Local Oil/Gas Control

The signs on Monday were pointing toward Colorado Gov. John Hickenlooper calling a special session of the state legislature later this month to pass a hoped-for bipartisan measure that would resolve nagging issues over local control of oil and natural gas activities throughout the state.

State lawmakers were unable to reach agreement on proposals in the regular legislative session, which ended last month (see Daily GPI, May 8), and attempts by the governor's office to garner support for a compromise bill that could be passed in special session have failed to materialize (see Daily GPI, May 29).

Broader and more clearly bipartisan support are still needed to bring the efforts to fruition by Hickenlooper, who is chairing a meeting of the Western Governors' Association (WGA) in Colorado Springs this week.

"Discussions continue, but there is no decision yet on whether or when a special session would be called," said a Denver-based spokesperson for Hickenlooper. “I don’t expect a decision before Wednesday, at the earliest, if for no other reason than the governor is at the WGA conference."

The spokesperson did confirm that Hickenlooper is pushing a compromise approach, but the stakeholders are a bit reluctant to embrace it.

"We have reached a place in negotiating local control issues related to oil and gas development where we are soliciting greater stakeholder input," he said. "We still need larger support -- and particularly bipartisan support, before deciding to call a special session."

The latest draft was distributed to all of the major stakeholders -- lawmakers, oil/gas sector operators, environmentalists and agricultural industry players. The measure would give local jurisdictions control over setbacks, but there are not specific setback distances established.

Currently there is no timeline for calling the lawmakers back in special session.

Earlier this year, Colorado groups pushing for more local control began to prepare ballot measures to further regulate energy operations (see Shale Daily, March 12). In recent months, industry-backed Protecting Colorado's Environment, Economy and Energy Independence (Protect Colorado), was launched as an "issue committee" to defend the existing regulatory framework, which it characterized as best in the nation.

Protect Colorado is funded by nearly $2 million in pledges from many of the state's top producers, including Anadarko Petroleum Corp., Noble Energy Corp., PDC Energy, Pioneer Natural Resources Inc., SM Energy and Whiting Petroleum Corp. The group is seeking to preserve "collaborative work" with state and local officials to protect the environment and quality of life.

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