The lower House in the Colorado state legislature on Monday gave its approval to a proposal (HB 1267) to greatly increase the fines against oil and natural gas operators responsible for damaging the environment.

HB 1267 now moves to the Senate after a 35-27 favorable vote in the House. It passed the lower house along partisan lines as only Democrats supported the measure and all Republicans and one Democrat voted against the proposal that would eliminate the current maximum cap of $10,000 on drilling fines.

Fines would increase from a maximum of $1,000/day to a maximum of $15,000/day, potentially the state’s first increase in drilling fines since 1955.

The bill’s sponsor Rep. Mike Foote told local news media that the measure is aimed at irresponsible oil and gas operators and would hold them accountable. Foote argued the bill will also “protect Colorado jobs” as well as the public health and the state clean air/water quality.

The Colorado Oil and Gas Association (COGA) has indicated it was not consulted on the measure before it was introduced, but it will work with legislators to refine the measure.

“As noted in COGA’s testimony during the committee hearing, we will continue to work with the sponsors on the legislation,” a spokesperson told NGI Tuesday. “Oil and gas regulations must work to both protect the environment and the business climate by encouraging best practices without being punitive.

“There are over 107,000 Colorado men and women whose jobs are supported by the industry; our families are passionate about protecting the communities in which our families live, work, and play.”

Proponents of the bill are trying to use the leak that was discovered near a Williams’ natural gas liquids (NGL) plant near Parachute Creek in western Colorado as further reason the Senate should pass the measure (see Daily GPI, April 12).

Earlier this month Williams officials concluded that “a failed pressure gauge” was the source of the hydrocarbon fluids the company found in March near its Parachute Gas Plant. The leak was stopped on Jan. 3 and had apparently started on Dec. 20 of last year, Williams said. Using U.S. Environmental Protection Agency (EPA) testing standards, Williams said it estimates that 80% of the NGLs vaporized before entering the soil.

Critics of the industry called HB 1267 only one of a series of measures designed to crack down on energy producers in the state.

So far, industry sources are not disputing the need to update the fines, but they question whether $15,000 is too high a maximum.

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