State Hearings on October 30 and 31- Was It Trick Or Treat With Most Applications Approved?

  • All Extraction spacing unit applications in Broomfield were approved, except for Lowell South Spacing and Increased Well Density pertaining to Lowell South.
  • Lowell South Spacing and Increased Well Density pertaining to Lowell South will be heard at the COGCC on Dec. 11 & 12. Wildgrass Oil and Gas Association argued that they were not given proper notice and the COGCC granted a hearing continuance.
  • The other Extraction spacing unit applications were approved with amended language, which was deemed a compromise by the Commissioners (COGCC).  Attorney Tuthill objected to no avail.
  • The Commissioners passed a motion to guarantee that drilling permits related to spacing units close to Adams County residents would have full hearings.  Adams County can file permissive intervention for those hearings.
  • The earliest hearing of Extraction drilling permits would likely be Jan. 29 and 30. This is based on the deadline for submission being Nov. 30.

From the time Citizen Comments began at 9:30 am on October 30 until the passage of the last motion to guarantee a full hearing on future drilling permits at 6 pm on October 31, there were unusual happenings during the Extraction spacing unit application hearings before the State (COGCC).  In the end, were the events a trick or a treat?

On October 30 during Citizen Comments, the Commissioners were treated to intelligent, respectful comments by about twenty Broomfield residents, along with Council Members Kreeger and Tessier.  Speakers included seven Wildgrass residents who referred to the lack of notice given to mineral owners and the outdated laws on forced pooling.  Adams County’s great questions during Citizen Comments about the location of the well pads caused some of the Commissioners to request a full hearing of pertinent Extraction applications 602 and 603 on October 31.

It was obvious that the Commissioners felt tricked by “the box that Extraction and Broomfield put us into.”  Broomfield and Extraction had signed a Settlement Agreement that stated, “The City agrees to withdraw the Protests so long as Operator’s applications and proposed orders are consistent with the number of wells and locations described in the New Agreements.”  Extraction submitted its spacing unit applications as being “subject to” this Agreement.  However, spacing units pertain to “downhill issues” at the COGCC and surface issues about pad locations are not specified until the next step of drilling permit applications.  The Commissioners grappled at various points over two days about how to deal with the unprecedented contingencies placed on Extraction’s spacing unit applications.

Adams County officials and residents felt tricked because they had been left out of the negotiations between Extraction and Broomfield regarding the Extraction pad locations sited in Broomfield near Adams County residences.  Several times during the Oct. 31 hearing, Adams County Commissioner Eva Henry stood up silently in the audience to try to be recognized to speak.  During the three-minute 510 statement allotted to her, she stated that Adams County would have protested the spacing unit applications if they had known sooner.  They pleaded their case for continuing the pertinent spacing unit applications near the Adams County residences (602 and 603).

Instead, on the second hearing day of October 31, Commissioner Bob Randall suggested compromise language for the spacing unit applications.  The amended language stated,

      The wells will be drilled from surface locations within the unit or at legal locations on adjacent lands.  Any applications for Permits to Drill (Form 2) or Oil and Gas Location Assessments (Form  2A) filed by Extraction Oil and Gas, Inc in the unit on surface lands within the City and County of Broomfield will comport with the October 24, 2017 Amended and Restated Oil and Gas Operator Agreement between the Application and the City and County of Broomfield.  

Commissioner Randall defined “will comport with” as “has to be consistent with.”  Broomfield Attorney William Tuthill objected to the Commission changing the “subject to” language to “will comport with” on the grounds that the Commission was not fully supporting the process of local government reaching an agreement with an operator.  Some commissioners stated that they fully appreciated the work of Extraction and Broomfield to reach an agreement.  However, they wanted the Commissioners to be able to follow usual procedure in reviewing the drilling permits to examine if the pads were located in the best locations to “protect health, safety and welfare.”  Some commissioners also said that the spacing application language was not needed because Broomfield had a contractual agreement with Extraction that stipulated the pad locations.

All Extraction spacing unit applications were passed with this amended language by a 4-3 vote, except for those pertaining to Lowell South.  The Commissioners then unanimously passed a motion to guarantee that drilling permits related to spacing units close to Adams County residents (602 and 603) would have full hearings.  It marked a significant COGCC acknowledgement that various local jurisdictions that were not the sites of adjacent pads might have a vested interest in such matters.  Adams County can file permissive intervention for those hearings since they do not have official standing to speak, according to COGCC rules.

Wildgrass Oil and Gas Association (WOGc) was appropriately given a well-deserved treat.  Led by questions from Commissioner Overturf, the COGCC agreed to hear the WOGc notice motion and also admonished Extraction for not treating WOGc Attorney Matt Sura with the respect that he deserved.  Attorney Matt Sura, along with witness Ann Marie Byers, stated that the Wildgrass Master Association, Townhome Association and 19 mineral owners had not been given proper notice.  However, it was the fact that Extraction had failed to even notify WOGc Attorney Matt Sura of their filing of an application that finally convinced the majority of the Commissioners to vote to continue the hearing.  They pointed to Extraction’s lack of “simple courtesy” and Extraction’s failure to “show respect for COGCC rules” in passing the motion to continue the Lowell South (598) and increased well density associated with it (749 DSU 2) until the next COGCC hearing on Dec. 11 and 12.

In the battle of the operators, Crestone lost and Extraction got the treat in COGCC’s decision as to which operator could develop the minerals in a contested area in the Lowell North spacing unit.  There were many hours of technical discussions to debate which operator could guarantee that no minerals were wasted.  Of note, there was no discussion by the operators or Commissioners about which operator might best protect the health and safety of nearby residents.  In a close vote, Extraction’s spacing unit application was approved and Crestone’s was denied.

As stated previously, the next COGCC hearings on Dec. 11 & 12 will include Lowell South Spacing and Increased Well Density pertaining to Lowell South.  The earliest hearing of Extraction drilling permits would be Jan. 29 and 30.  This is based on the deadline for submission being Nov. 30.