Report recommends changes to oil/gas regs

Oil.daily.3.17.2014

In the wake of last September’s floods, a new report from state oil and gas regulators recommends that oil companies maintain precise locations and inventories of wells and production equipment near waterways, that all new wells near waterways contain remote shut-in equipment, and that no open pits be allowed within a designated distance from the high-water mark of any given streams.

In the report, released Monday, staff of the Colorado Oil and Gas Conservation Commission said they would not recommend any new state laws to address flood damage in oil and gas fields, but that they would suggest changes to regulations governing how production and gathering facilities are sited and constructed.

The commission noted that more than 5,900 oil and gas wells are within 500 feet of a Colorado stream.
 
The Colorado Oil and Gas Association, however, said that the industry responded well to the emergency and that no further regulatory action was needed.

“The floods were a difficult and trying event for everyone, and we are proud at our ability to engage meaningfully in the response and recovery of our Colorado communities,” Tisha Schuller, president and chief executive of the association, said in a statement Monday afternoon. “The flood report reiterated facts supporting that Colorado’s oil and gas industry was extraordinarily well prepared, responded in real time, and is committed to Colorado’s recovery.

“Our industry prepares for all sorts of disasters with emergency response plans and drills; in this case, we were quick to respond with remote and manual shut-in of wells, deployment of thousands of employees, and implementation of 24-hour emergency operations centers.”

As a result, Schuller said, “COGA does not believe any legislative or statutory changes are necessary.  We will continue to work with the commission to share lessons learned and continually improve best management practices.”

Commission spokesman Alan Gilbert said commissioners will discuss the report’s findings at their next meeting April 28 and decide which, if any, new regulations are needed.
 
In an e-mail, Gilbert said, “New rules typically take six months to a year or more to promulgate. In this instance, the commission said this morning that it understands the need to move as quickly as reasonably possible with this process.”

Oil and gas rulemaking in Colorado has stirred passionate debate and conflict in recent years and these may as well.

“We are sure there will be vigorous discussion about the best ways to proceed with industry and others,” Gilbert said. “But we welcome that vigorous discussion. It always makes the regulation or policy better.”


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