Hick gets flak over swig of flack-aid

Governor says energy industry has become ‘unseen villain’
The Colorado Statesman

One day after the Colorado Oil and Gas Conservation Commission passed a statewide 500-foot setback on drilling, Gov. John Hickenlooper, a Democrat and former geologist, sent a shockwave through the environmental community by admitting on Tuesday to literally drinking the frack-aid.

Speaking before the U.S. Senate Committee on Energy and Natural Resources in Washington, D.C., Hickenlooper said he took a sip of hydraulic fracturing fluid produced by Houston-based Halliburton, one of the largest providers of products and services to the energy industry.

The governor — who has come under fire from environmentalists for his support of the energy industry and its controversial hydraulic fracturing methods — recalled sitting around a table in his office after an energy industry executive produced a glass of the fracking solution.

“At one point in my office, I’m not sure how this happened — the new frack fluid is made with food additives — and somehow we all took a swig of frack fluid,” Hickenlooper spoke of the almost ritual experience. “It was not terribly tasty, but again, I’m still alive… to tell the story.”

A fracking fluid produced by Halliburton known as CleanStim has been marketed as using ingredients from the food industry. It is unclear whether the product is actively being used in Colorado. Halliburton maintains, “Acquiring the ingredients from the food industry provides an extra margin of safety…” The idea is to quell fears that the fluid poses environmental dangers.

Hydraulic fracturing employs the pressure of a fluid — often times including chemicals, sand and water — to increase extraction rates. Concerns have grown that water can become contaminated, especially as the process has made its way to the heavily populated Front Range. There are also noise, congestion, air pollution and resource fears associated with fracking.

Environmentalists reacted with shock and awe to the governor’s testimony, flabbergasted that he would so publicly endorse the ingredients.

“Looks like Gov. Hickenlooper really drank the frack-aid on this one,” declared Carrie Curtiss, deputy director of Conservation Colorado. “We’re astounded that Gov. Hickenlooper would use a national platform to give the impression that frack fluid is safe for public health.

“The industry has a track record of misleading the public about the fact that its fracking fluid contains numerous toxic chemicals…” continued Curtiss. “Rather than implying to a national audience that there is nothing to fear, [Hickenlooper’s] energy would be better spent protecting public health back home.”

It wasn’t all criticism for the governor. Tim Wigley, president of Denver-based Western Energy Alliance, an oil and gas trade association, cheered the governor for his candid response.

“I appreciate the governor’s comments and his actions and willingness to go play a leadership role there. I think he made a fairly substantial credible point that a lot of this hysteria that’s going on about fracking is not necessary,” said Wigley.

“I appreciate a person in his position taking the time, and being willing to go up there and talk about how important that practice is in the State of Colorado, and throughout all the West,” he continued.

The governor and former brewery owner made national headlines for his “frack-aid” comments, resulting in an e-mail he issued on Wednesday that stated, “Despite what you might have heard, I much prefer drinking beer to frack fluid.

“As we move forward in developing energy, we ought to insist on the strictest and most effective environmental safeguards,” he continued. “Although tasting frack fluid might seem newsworthy to some, it was not really the point of testimony… We were drawing attention to the fact that Colorado has created the most comprehensive and stringent set of regulations around oil and gas production in the country.”

The governor also pointed out that Colorado last year enacted “the most rigorous and transparent frack fluid disclosure in the country.”

At an intimate media availability with the Colorado Capitol press corps on Thursday, Hickenlooper said he felt the “frack-aid” comment was blown out of proportion.

“Don’t you think it’s fair to say that it wasn’t intended as a political statement? It was intended as a description of the honest efforts that the industry is trying to make to have an industrial fluid that was totally harmless to the environment,” declared the governor.

During his presentation to the U.S. Senate panel, in which the focus of his comments was on natural gas development, Hickenlooper said the energy industry has become an “unseen villain,” suggesting that the controversial fracking process is safer than people think.

“We are creating thousands of jobs by having this energy created and extracted at home, we are increasing our national security, and we are dramatically reducing greenhouse gas emissions,” Hickenlooper testified.

U.S. Sen. Mark Udall, D-Colo. — after introducing his governor to the committee that he sits on — asked Hickenlooper about the growing concerns.

“We have seen a big economic boost from the current oil and gas boon, as the governor mentioned. It also has brought some challenges,” explained Udall. “In our neighborhoods and communities, we’ve seen additional drilling and concern from our citizens. I think the governor and I both should believe that there’s a great economic opportunity. But our No. 1 priority is to protect the health and wellbeing of our citizens.”

Hickenlooper agreed, suggesting that capturing poisonous “fugitive methane” released through gas production activities should be a priority. The governor pointed out that Colorado State University is working on a study to measure air quality.

“The issue around methane is crucial because it is very harmful to our environmen…” Hickenlooper advised the panel. “If you allow fugitive methane to escape… we lose much of the environmental benefit.”

He also spoke in favor of state control over oil and gas regulation, as opposed to sweeping federal regulations.
“States are the laboratory of democracy, and we are focusing on how we create a rigorous set of regulations,” testified Hickenlooper.

Regulating energy development in Colorado

But the question over who should regulate energy development is not so clear in Colorado. Environmentalists feel that local governments would be the most effective because they are closely connected to their communities. The energy industry, however, is fearful that a patchwork of regulations would lead to uncertainty.

Hickenlooper tends to lean in the direction of state control. His administration has filed a lawsuit against Longmont for enacting rules and regulations that are separate of the state. The new regulations include a ban on drilling operations in residential areas.

Longmont voters this past November also backed a full ban on fracking. Hickenlooper said the state would not sue the city over its ordinance, but that it would support private lawsuits. The city is facing a separate lawsuit from the Colorado Oil and Gas Association over the ban.

Longmont isn’t the only city to enact its own energy rules and regulations. Local rules are being enacted all over the state. Uncertainty remains as to whether the rulemaking is legal. The courts will likely settle the issue.

In the meantime, the COGCC is moving on with its work. On Monday, the commission on a vote of 8-1 passed new rules that include:

• Extending setback standards to 500 feet statewide;

• Prohibiting drilling within 1,000 feet of schools, nursing homes and hospitals without a hearing before the COGCC;

• Requiring operators proposing to drill within 1,000 feet of an occupied structure to take measures to limit spills, capture gases, reduce odors, noise, dust and lighting; and

• Requiring operators to engage in outreach efforts with nearby residents and local governments.

Commission members applauded themselves for making it through the yearlong process, which included several marathon public hearings that saw public comment from all stakeholders.

“We’ve heard from so many Coloradans with important perspectives on a highly charged and complicated issue, as difficult an issue as this commission has ever addressed,” acknowledged Matt Lepore, director of the COGCC. “We’ve tried to reach a balance that fairly considers and applies all the concerns expressed.”

Commissioner Tommy Holton, the mayor of Fort Lupton — which lies in energy production heavy Weld County — was the only dissent.

“Weld County is one of the best places to live if you don’t want cancer. I took more of a risk coming down here to Denver in my car than staying in my house where I’ve got three wellbores… And I’ve lived there for 10 years. I’ve been living around wells all my life,” lamented Holton.

“I just don’t see where the scientific data says that if you’re within 500 feet; if you’re within 100 feet — what difference does it make?” Holton continued. “We don’t have that information, so why are we going about this now? This is way too early in my mind, and even if that study does come back and says you’re safe within 200 feet, do you think we’re ever going to come back and revisit that question? That’s not going to happen.”

The Colorado Oil and Gas Association agreed with Holton, pointing out that it had recommended an alternate plan that would have set a standard of 350 feet subject to surface use agreements between owners and local governments; and set the high-occupancy setback at 750 feet.

“We hope that policy makers will recognize the numerous economic repercussions that these increased setbacks will have on all stakeholders, including the oil and gas industry, farmers, ranchers, developers and all Colorado taxpayers,” said Tisha Schuller, president and chief executive of COGA. “Energy is the cornerstone of prosperity, and we are all heavily dependent upon the benefits of affordable, accessible, reliable energy.”

Perhaps offering proof that the COGCC’s rulemaking brought a true compromise is the fact that all stakeholders walked away from the process unhappy. Environmentalists immediately criticized the commission for failing to enact rules that truly protect citizens.

“The rules passed by the commission today are not protective of Colorado’s air, land, water and our public health,” said Pete Maysmith, executive director of Conservation Colorado. “For months Coloradans have testified that they want significant protections to reduce the impacts of drilling and fracking. Instead, we are left with rules that don’t solve the problem, leaving our homes, businesses and communities exposed to the coming onslaught from heavy industrial drilling and fracking.”

The commission also recently backed mandatory groundwater monitoring of all new oil and gas wells, both before and after a well is drilled.

The Greater Wattenberg Area, a heavily drilled stretch of land from Northglenn to Eaton, was granted its own rules. Companies do not have to take new groundwater samples before drilling if the water has been tested within five years. Because the area has been drilled for many years, the industry said it would be difficult to determine if new drilling is causing contamination.

Hickenlooper on Thursday was hesitant to say that he approved of the specifics laid out in the COGCC’s rulemaking, but he is supportive of the process itself.

“I approve of the process by which we got to the rules, which really, by definition, means that I approve of the rules,” he told reporters.

Legislature may step in

But that rulemaking process may be complicated. Democratic lawmakers are lining up to offer measures that would challenge the COGCC’s rulemaking. Emerging ahead of the pack is Sens. Morgan Carroll, D-Aurora, and Matt Jones, D-Louisville, and Reps. Mike Foote, D-Lafayette, and Dickey Lee Hullinghorst, D-Boulder.

Any legislation that is offered would come in the form of a late bill, and lawmakers have told The Colorado Statesman that they would prefer to wait until high-profile distracting legislation around gun control is out of the way.

It is possible that Democratic legislators will introduce a package of bills that address:

• Increasing setbacks;
• Placing regulation in the hands of local governments;
• Adding more stringent water quality testing standards;
• Increasing fines assessed on operators;
• Broadening requirements around drilling site inspections; and
• Placing tougher environmental standards on the industry.

Foote points out that the contention surrounding the COGCC’s rulemaking is an indication that perhaps the state is not best suited for imposing regulation.

“It goes to show how difficult doing a statewide set of regulations is…” explained Foote. “You have my county of Boulder, which would probably go one way on setbacks given the option, but next door to me is Weld County, which would probably go a different way. And the only thing separating us is a border.”

Jones was also critical of the COGCC, suggesting that its rulemaking did not go far enough.

“I think the setback rules are Swiss cheese…” he said. “I had hoped that they would have done much more responsible and robust rules. There are cities in the gas patch of Texas that have 1,000-foot setbacks. Why can’t we do it in Colorado?”

Hullinghorst said Coloradans should expect legislation introduced in the coming weeks.

“Many legislators have heard loud and clear from their constituents that someone needs to stand up for Colorado residents and our communities as we face increased heavy industrial oil and gas development,” she said. “Unfortunately, the rules passed by the COGCC fall far short of protecting Coloradans. As the state legislature continues its work this session, my colleagues and I will be looking to pursue measures that put the health and safety of Coloradans first and pursue balanced energy policies that protect Colorado’s environment, public health and our unique quality of life.”

The governor has already expressed concern that the legislature may intervene and potentially contradict the commission’s extensive work.

“There’s no shortage of voices that are upset — industry voices, legislative voices, people who have a different opinion than what the Colorado Oil and Gas Commission came out with,” remarked Hickenlooper. “But I keep coming back to, it seems like a pretty fair compromise. Nobody gets what they wanted, but we kept the quality of our environment as a core value.”