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Energy regulation debated in Denver

Donna GrayVail, CO Colorado
Post Independent file photo/Donna Gray
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GLENWOOD SPRINGS – Colorado legislators this year are considering a profusion of bills relating to the oil and gas industry that is surging in western Colorado. The bills cover everything from measurement of gas production to protecting wildlife habitat and public health. Six bills deal directly with the immediate effects of oil and gas drilling and many more with funding for the bills’ mandates as well as the use of severance taxes paid by the oil and gas industry.”There are probably as many oil and gas bills in (this) one year than in the last five years,” said Greg Schnacke, executive vice president of the Colorado Oil and Gas Association.The former agency gives 15 percent of its share to local governments in direct payments and keeps 85 percent in a local government trust fund which distributes the money as grants to cities, towns or counties directly impacted by energy development.The amount of direct payments is based on the number of employees working in energy-related industries.HB 1139 would increase the direct payment to 30 percent.House Bill 1139, sponsored by Rep. Kathleen Curry (D-Gunnison) and Sen. Josh Penry (R-Grand Junction), would increase the amount of severance tax revenues local governments receive in direct payments.Currently, the state Department of Local Affairs gets 50 percent of those revenues and the Department of Natural Resources the remainder.

“That would give more money to areas affected by energy,” said Aron Diaz, executive director of Associated Governments of Northwest Colorado.The bill passed the House in a vote of 60-5 last week and is headed to the Senate.Also sponsored by Curry and Rep. Al White (R-Winter Park) is HB 1142 that would make county assessor records relating to oil and gas property values public. Currently, those documents are confidential.The bill was driven by a state auditor’s report, White said, which concluded that more control was needed in oil and gas operations. “I think the oil and gas industry would be a beneficiary” of the bill, he said. “Anything they can do to create transparency (in their operations) should create public confidence that they’re doing what they say.”White is also sponsoring, with Sen. Jim Isgar (D-Hesperus), HB 1180 that would set standards for accurately measuring natural gas production at the well head. It would also require oil and gas companies to explain the deductions and adjustments it takes out of royalty payments.House Bill 1223, sponsored by Curry, would direct the Colorado Oil and Gas Conservation Commission to formulate a rule that requires it to consult with the Colorado Department of Public Health and Environment regarding the possible effects of oil and gas drilling on public health, before issuing a drilling permit.Curry admits the bill is “contentious.””The idea is to minimize public health hazards,” she said. “The oil and gas industry hates it.”But Schnacke said the Oil and Gas Association is working with Curry on the bill.

“At this point there’s a lot of discussion what form it might take,” he said. “(The bill) is pretty vague.”HB 1298, sponsored by Rep. Dan Gibbs (D-Silverthorne) and Sen. Lois Tochtrop (D-Adams County), seeks to protect wildlife habitat from the impacts of oil and gas operations. The bill has won the support of the Colorado Mule Deer Association.”These (oil and gas) companies are flush with cash, and they have the know-how and equipment to avoid or dramatically minimize impacts to our wildlife,” said Bob Elderkin, of Silt, spokesman for the association. The jury is still out with the Oil and Gas Association, however.Most of these bills will be debated in the House Tuesday and Wednesday.


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