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Additional Local Bans on Fracking Coming, COGA CEO Says

While they are unlikely to impact future production totals and may face court challenges, local community anti-hydraulic fracturing (fracking) ballot measures are likely to continue to emerge, the head of the Colorado Oil/Gas Association (COGA) told NGI's Shale Daily on Thursday.

COGA CEO Tisha Schuller said she is expecting more ballot measures like the four that were voted on earlier this month (see Shale Daily, Nov. 6), but in the long term she thinks the oil/gas industry will win out in stating its case for providing jobs and responsible energy development in the state. She is not sure a statewide ballot measure will emerge next year, but it is still possible.

Broomfield, one of four cities in the state that voted on anti-fracking measures Nov. 5, is considering a recount of the election that resulted in a 13-vote defeat of its measure. Schuller called the ultimate result in Broomfield a bellwether for future activity on the issue.

To date, 26 communities in Colorado have passed fracking measures, but in 22 cases, COGA has subsequently worked out requirements for drilling and fracking with local officials that were acceptable to industry operators. That leaves four communities, along with the city of Loveland, whose ballot measure proposed for next year is tied up in a court filing, as wild cards, Schuller said.

"In Broomfield, they just closed the hearing process yesterday [Wednesday], so I think it is likely they will go to a recount in the next couple of days," said Schuller, who thinks it will take until the end of the year before COGA decides whether it will legally challenge some of the vote results.

"These elections really don't forecast what a statewide ballot initiative might look like because three of the communities are known as being very liberal -- Boulder, Lafayette and Fort Collins. They are good places to win a ballot, but that is not in any way indicative of Colorado overall, which is considered a ‘purple’ state politically.

"The closeness of the effort in Broomfield tells us more about where other communities that are unfamiliar with oil/gas development may go [on similar ballot measures]. What we've learned is that neighbor-to-neighbor outreach works in getting support for oil/gas development, but we also know there is no easy answer. It isn't a matter of one advertising campaign."

In terms of concerns about impact on production in the state, the recent votes will have no impact, said Schuller, noting that in both Boulder and Lafayette the votes were "symbolic" because neither city has had any drilling activity since the early 1990s. In contrast, what did have an impact on production were record-setting floods in September.

Production losses from flood-related well shut-ins (see Shale Daily, Sept. 20) totaled 36 MMcf/d of natural gas and 18,750 b/d of oil, according to COGA's latest statistics. This had a significant impact on state tax revenues, said Schuller, without giving any specific dollar amounts.

Schuller views the ballot measure battles as going on for years, and she said COGA is committed to build its case for more oil/gas development "community-by-community." She said there is no organized effort for a statewide ballot measure at this time.

Regarding looking at taking cities to court for allegedly taking property from mineral owners and oil/gas operators from the ban, Schuller said COGA is looking at its options in both Fort Collins and Broomfield, should the latter city's measure win out in the recount of votes.

"Within the next six weeks, we should know what our approach will be," she said. "Our focus is on the mineral owners and the operators who now are threatened with takings of their property and looking at what the ramifications might be." She has not checked with Gov. John Hickenlooper's office to determine if the state will challenge in the courts.

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