Boulder County sues Extraction Oil & Gas, claiming planned drilling on protected land

BOULDER — The Boulder County Board of Commissioners is asking a judge to strip legal protections from Extraction Oil & Gas Inc. (Nasdaq: XOG) so that it can get an injunction to stop an alleged plan to drill a well in conserved Boulder County lands.

In filings with the U.S. Bankruptcy Court for the District of Delaware, Wednesday, Boulder County said the Denver-based Extraction allegedly notified a local resident that it would start drilling on the property in mid-November. 

Extraction, through its subsidiary 8 North LLC, wishes to build 32 wells and a 10-acre processing facility on the property.

The land straddles the Boulder-Weld county line just south of Longmont, and is subject to a conservation easement that restricts development on the property.

The county has two existing lawsuits to stop Extraction’s drilling plans within the state courts, but those were stayed by federal courts when Extraction declared bankruptcy in June. It claims that Extraction did not notify the county directly, or in a status report to the state courts earlier this month.

Entities that declare bankruptcy are usually granted automatic protection from lawsuits or collections when they are in the midst of the process, but creditors can ask the court to remove that protection in certain circumstances.

In this case, the county is asking the court to lift protections for Extraction, which would allow the county to seek an emergency injunction at the state level.

“Absent the relief from the Delaware Bankruptcy Court, the subject matter at issue in the… Property will be irreparably harmed, effectively rendering the County’s appeal moot,” the county said in its filing.

The court has granted a hearing on the emergency motion on Nov. 5.

In a statement, Extraction said it had mineral leases on the property far before Boulder County purchased the property’s easements.

“The district court in both previous lawsuits filed by Boulder County agreed with Extraction that it has the right to drill the mineral property in accordance with approved state permits,” the company said. “At this point, Extraction is only planning on initial work at the drill site and does not currently plan on conducting completion operations at the site until after the Court of Appeals has issued their rulings.”

This is not the first time that Extraction has tangled with a Boulder Valley governmental body. It is currently suing Broomfield, alleging that the city and county are using targeted ordinances to shut down its operations in the area.

on Facebook on LinkedIn