Six Month Moratorium Passes First Reading and Council Will Protest Spacing Application Near Anthem

On the first reading of Ordinance No. 2091, Council unanimously voted to impose a temporary six month moratorium on processing or approving applications for oil and gas development of oil and gas facilities in Broomfield in order to amend Broomfield’s oil and gas regulations from 7/10/18 after recent passage of SB19-181 Protect Public Welfare Oil and Gas Operations. SB19-181 gave local governments greater power to protect public health and safety by regulating oil and gas industry operations in their jurisdictions.

Broomfield residents speaking in favor of the moratorium included Chris Cleary, Jean Lim (author), Heidi Henkel, Lizzie Lario and John Varn.  Residents asked the City to consider an even longer moratorium so that State rulemaking could take place and Staff would have enough time to work on the regulations, given their continuing role in oversight and fielding complaints with the Extraction project.  Colorado Petroleum Council Associate Director Chris McGowne spoke against the moratorium saying Broomfield was making the industry feel like “we are not welcome.”  Broomfield resident Marty Robinson asked why passage of the ordinance was being rushed.  

Council Member Tessier stated that this moratorium was “not about being unwelcoming but about a change in the rules” that was needed after passage of SB19-181.  Council Members Kreeger, Erickson and Law-Evans all stated that they supported the six month moratorium now with a possible extension later.  Council Member Groom asked for an outline of the path for revising the regulations. The first reading vote was 8-0 in favor, with Council Member Shelton absent.  The second reading and public hearing is scheduled for May 28.

Later during the Study Session at about 10 pm, Council began discussion of actually amending the regulations.  In a preliminary outline, proposals from Staff focused on moving what were marked as potential requirements (17-54-100) in the Municipal Code to be used in negotiating Operator Agreements to mandatory requirements (17-54-90).  Attorney Sullivan cautioned that any new regulations would have to be “reasonable and necessary,” repeating a qualifier for local government regulations in SB19-181.

Council Member Kreeger suggested adding the Task Force Legal Committee requirements, financial assurances, protecting parks from drilling, and reviving two Task Force subcommittees focused on property values and nuisances.  Council Member Tessier suggested widening the notification distance for neighborhoods near oil and gas facilities.  Council Member Castriotta stated that 301 should be fully implemented now so that oil and gas development could only be done in a manner with no adverse impacts.  Council Member Beacom countered that he needed to hear from Staff if 301 could really be fully implemented just because of the passage of SB19-181.  Council Member Law-Evans suggested this discussion might need to take place in Executive Session but Council Member Erickson raised an unanswered question to Attorney Sullivan if it could be discussed at a regular meeting.

Broomfield resident Lizzie Lario asked the City to consider regulations on property value compensation, to reflect a currently discussed topic in Wildgrass.  Jean Lim (author) asked Council to look at codifying enforcement into the new regulations since current issues with the Extraction project seemed to shed light on deficiencies with enforcement.  Another Broomfield resident requested that Council remember that oil and gas employees live in the City when enacting revised regulations.        

Also at the special 5 p.m. Council meeting, Council considered whether or not to file a protest at the Colorado Oil and Gas Conservation Commission (COGCC) by May 17 on spacing application 190600405 filed by BC Deep Holdings, LLC which would impact Anthem.  Extraction has an approved spacing unit that includes the area under a portion of Anthem Ranch and a smaller area south of the Acme Pad in Erie and north of Highway 7 (see purple area on map to the right).  Crestone has an approved spacing unit for the area in light blue which will be drilled from the Acme Pad. BC Deep Holdings owns mineral interests in the Extraction spacing unit, specifically in the area south of the Acme Pad in Erie between the Acme Pad and Highway 7, which is in red crosshatch on the map.  BC Deep Holdings is asking the COGCC to remove the red crosshatch area from Extraction’s spacing unit and add it to Crestone’s spacing unit for the Acme Pad, so that Crestone can develop BC Deep Holdings’ minerals.

Director of Special Initiatives Tami Yellico did a brief introduction of the item, saying that the operator/operator/large mineral owner contention was very complicated and hard to fully understand at this point.  During public comments, Broomfield resident Jean Lim (author) pointed out that the new spacing unit application might bring the Crestone Pad closer to Anthem Ranch with up to 36 wells instead of 30 as approved by Erie.  She asked that the City consider filing a protest as a “placeholder” so the City could be included in the June hearing to represent the health and safety interests of the northern Broomfield residents. 

Council Member Kreeger asked that the City throw everything possible into the protest, including a request for alternative site analysis and application of SB19-181.  The City’s announcement stated that “BC’s attorney has indicated that Crestone is supportive of this change to spacing units and Extraction opposes it.”  Mayor Ahrens commented that he did not mind taking sides on this as it seemed that it might be more advantageous to leave the contested part of the spacing unit in the hands of Extraction.  Attorney Sullivan admitted that the City did not fully understand the total implications of this new spacing unit and Council gave a unanimous nod on the protest, without actually voting on it.