Oil, gas advocates warn against ballot measures

The Colorado Statesman

Oil and gas advocates warned Tuesday that Colorado’s economic recovery could shift back into recession if two ballot initiatives on oil and gas development get onto the November ballot and are approved by voters.

During a telephone town hall Tuesday, attorney Peter Moore, chairman of Vital for Colorado and Tisha Schuller, president and CEO of the Colorado Oil and Gas Association, advised callers to say “no” to anyone asking them to sign petitions for the two ballot measures.

“Our goal with this tele-town hall is to highlight Colorado’s well-regulated and safe energy industry and the threats posed by efforts to unreasonably restrict oil and gas production which is vital to Colorado’s economic future,” Moore said.

Schuller and Moore spoke about init-initiativ and 89 during the Tuesday call-in, a forum directed at seniors who were identified from voter rolls from populous counties.

Ballot initiative 88 would mandate a 2,000-foot setback for oil and gas drilling operations. Ballot initiative 89 would establish an environmental bill of rights, which Schuller said would undermine the solutions that COGA and the industry have developed with local governments. “These initiatives are designed to make oil and gas development more difficult,” Schuller said. Moore added that if the measures pass, local control solutions would be tossed out the window.

While the sponsors of Tuesday’s call-in came from the pro-oil and gas side, some callers appeared to express skepticism about industry claims on the safety of hydraulic fracturing. They also raised concerns about recent reports of possible seismic activity, water quality issues and the possible side effects of chemicals used in hydraulic fracturing.

During the call-in, participants were identified by first name and county only. About 1,200 people participated in the forum, according to a spokesperson for Vital for Colorado.

Colorado has the strictest regulations on oil and gas development in the country, Schuller said, in response to a question. She explained that the state has tightened its regulations several times in the past six years, such as setting drilling setbacks at 500 feet, increasing fines for oil and gas offenses, and implementing a statewide water sampling requirement pre- and post-drilling. “We’re really willing to recognize that Colorado is a special place and hold ourselves accountable to the highest standards,” Schuller said. Colorado’s current regulations are the strongest in the country and even in the world, so much so that the international industry based some of its model standards on Colorado’s example, she added. “It’s made the oil and gas industry stronger.”

According to Schuller, the oil and gas industry in Colorado generates $30 billion in economic activity and 110,000 direct and indirect jobs. The industry pays $1.6 billion in state and local taxes, with $680 million of that going to schools, she explained.

Do hydraulic fracturing chemicals cause cancer? asked one caller. Schuller pointed callers to www.fracfocus.org, a national hydraulic fracturing chemical registry that shows oil and gas wells in each state and the chemicals used in those wells. Operators are required to disclose the fluids they use in the hydraulic fracturing process, Schuller said. “What’s important is not whether the chemicals cause cancer but how they’re isolated” from workers and communities. She likened it to how a person separates cooking activities from cleaning fluids in the kitchen.

Schuller also addressed a question on seismic activity. In June, the Colorado Oil and Gas Conservation Commission imposed a 20-day stoppage on a hydraulic fracturing operation in Weld County after the second of two small earthquakes in the area. Schuller said that the industry is aware that disposal wells can cause earthquakes but said that that they are “significantly different” than hydraulic fracturing wells. Disposal wells are waste sites, thousands of feet below the surface that store used drilling fluid. Schuller explained that the seismic activity in hydraulic fracturing is about the same as dropping a gallon of milk off the kitchen counter. “It’s too small to be significant,” she said. In addition, the state screens for such activity, and has requirements for long-term disposal of fracturing fluids.

Another concern, raised by a caller from Brighton, is what would happen to mineral rights and royalties if the ballot measures pass. Schuller explained that in Colorado, under the principle of the “split estate,” one person can own the mineral rights below ground while another owns the surface rights. The ballot initiatives don’t address what happens to people’s mineral rights and royalties, she said, and it’s an open question of who would reimburse the mineral rights owners if the measures pass. “We shouldn’t be taking these complex issues to the ballot in the first place,” she said.

Just how much water is used in the fracturing process? asked Pat from Douglas County. Schuller replied that it’s about one-tenth of one percent, compared to the amount of water used in agriculture, at 85 percent; and for residential use, at 8 percent. She acknowledged that water used in fracturing is not recovered, but she also pointed out that the process can generate water, and many operations are able to recycle some of their water. Additionally, fracturing uses lower quality water that can’t be used for drinking or agricultural purposes, and processes have been improved to reduce the amount of water used. “Every drop matters,” she said.

In response to a question, Schuller pointed out that oil and gas development is important to the nation’s ability to reduce its reliance on foreign energy sources, and that natural gas is necessary to back up wind and solar power when the sun doesn’t shine or the wind doesn’t blow.

Schuller and Moore noted that a number of editorial boards have already come out in opposition to the ballot measures, as have Gov. John Hickenlooper and his Republican opponent, Bob Beauprez. Numerous groups and business organizations are working to educate the public about the ballot measures as well, they said.

“This discussion should go far beyond simply environmentalists versus industry interests, and should focus on widespread economic impacts” that affect all Coloradans, said Moore. His group is a coalition of 2,700 businesses, associations and individuals that promotes energy production in Colorado.

“We encourage you to continue the dialogue,” Schuller said in closing. “Oil and gas are vital to our way of life and this is an important year. Efforts to make it more difficult to produce oil and gas could undermine our economy.”

Petitions for the ballot measures are due to the Secretary of State’s office by Monday, August 4. Each initiative requires 86,105 signatures, although ballot supporters usually collect more than 100,000 to ensure they have enough valid signatures.

The organization behind the initiatives, Coloradans for Safe and Clean Energy, which is backed by Congressman Jared Polis (D-Colo.), reportedly said a couple weeks ago that they had gathered about 65,000 signatures each for the two measures.

Marianne@coloradostatesman.com