Producers that operate in Colorado apparently were on a mission to secure drilling permits under the state’s “old” natural gas and oil rules, with a record number of permit applications filed in March, according to the Colorado Oil and Gas Conservation Commission (COGCC). New rules to drill on state lands took effect Wednesday; the federal lands drilling revisions are to take effect in May.
Although drilling in Colorado is down an estimated 60% from 2008 highs, the COGCC reported that 793 permit applications had been filed as of last Friday. More applications continued to pour into the office this week, said acting COGCC Director Dave Neslin.
The prior one-month record for permit applications filed with the COGCC had been 784, which was set in April 2008.
The COGCC overhauled the drilling rules late last year, and the Colorado Assembly last month signed off on the package and sent it to Gov. Bill Ritter for his approval (see Daily GPI, March 26). Ritter, who supported the revisions, plans to sign the bill to enact the rules, but the rules take effect with or without his signature, Neslin said.
“It will be important that he sign the bill prior to May 15,” said Neslin, because the bill allows the drilling revisions and other rules to continue indefinitely past mid-May.
Not all portions of the revised rules take effect this week, Neslin noted. Some rules will be phased in this year. Rules that cover drilling on federal lands are poised to take effect May 1, but they may be postponed to ensure Colorado regulators and the Bureau of Land Management (BLM) prevent any overlap between state and federal jurisdiction.
State and BLM officials already have met to discuss the rules changes, and more meetings are scheduled this month, according to the COGCC. The COGCC met on Monday but did not issue an extension for the rules that cover federal lands. The commission’s next scheduled meeting is April 20.
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