Colorado regulators last week set the first new rules under an omnibus oil and natural gas bill that was passed earlier this year.
Revisions to the state's regulatory scheme are expected to take more than a year to implement as the legislation aims to make public health and the environment priorities in the oil and gas development permitting process, along with revamping the Colorado Oil and Gas Conservation Commission (COGCC).
The new rules stiffen requirements for the practice of forced pooling, which allows operators to extract resources owned by multiple parties and distribute the profits among them. The changes also give administrative law judges and hearing officers authority to grant some decisions while the COGCC members are busy adopting the new rules.
During its hearing and public comment period, the COGCC discussed a revised timeline for future rulemakings, with the intent to schedule stakeholder meetings soon on public health, safety, welfare and environmental provisions, according to state Department of Natural Resources spokesperson Chris Arend. Hearings could begin in February, Arend said.
The Colorado Petroleum Council (CPC) lauded the COGCC for "remaining within the scope of the first rulemaking" prescribed in the legislation, which CPC Executive Director Lynn Granger said was designed to be straightforward in its regulatory approach.
Noting the industry support for the COGCC staff's proposed changes, Granger commended the commission "for keeping this rulemaking narrow in scope, and we are committed to continuing to work with all stakeholders on the other issues that were identified." CPC is committed to policies that "protect health, safety and the environment," she said.
Colorado Oil and Gas Association (COGA) CEO Dan Haley called the new rules an "important first step" in a long regulatory process.
"With a dozen technical rulemakings required by SB 181, this is a marathon, not a sprint," Haley said. "COGA is an active participant in stakeholder discussions on a variety of topics that will ultimately lead to a number of changes. Industry’s participation is crucial, as we need to ensure that new rules are based on sound science and data, and do not trend toward subjectivity and political opinion.”