Federal and state proposals to regulate the oil and gas industry intersected Wednesday at the state Capitol with hearings which addressed rising concerns over hydraulic fracturing practices.
A rare field oversight hearing of the U.S. House Natural Resources Subcommittee on Energy and Mineral Resources, led by the committee’s chairman, Colorado’s own U.S. Rep. Doug Lamborn, R-Colorado Springs, kicked off the marathon of mid-week debate, addressing draft federal regulations on the so-called “fracking” operations.
Much of the rest of Colorado’s congressional delegation attended the hearing as well, including committee member U.S. Rep. Mike Coffman, R-Aurora, as well as non-committee members who were permitted to sit-in, including U.S. Reps. Diana DeGette, D-Denver, and Scott Tipton, R-Cortez.
The Interior Department’s draft regulations would require the disclosure of fracking ingredients and amounts, according to reports back in February. Producers would also be required to seek approval from the Bureau of Land Management for the fracking operations, pressure-test well casings and storage of fracking fluids in tanks or lined pits, according to reports of the draft regulations.
Republicans have raised concerns over impacts to the industry as a result of the draft regulations, arguing that the proposals would halt or slow natural gas and oil development on federal lands, job creation and local economic growth. In fact, Lamborn, Tipton and Coffman have introduced a package of bills that are part of the Republicans’ energy agenda that aim to increase and streamline drilling operations across the nation, especially in Western states. They believe the processes are safe, and that state governments are fully capable of keeping them so.
“While states have worked diligently to implement hydraulic fracturing regulations on their own lands, the Obama Administration seeks to hijack those efforts and impose their own blanket set of regulations with little to no consultation with the states or tribes that would be affected,” Lamborn said in opening remarks, perched on his chair front and center in the Old Supreme Court Chambers. “While we have our own set of carefully crafted and effective regulations, I am disappointed that when invited, Gov. [John] Hickenlooper and the Department of Natural Resources chose not to defend their work, or the citizens of Colorado, against this federal onslaught of destructive regulations.”
Hickenlooper and Mike King, executive director of the Department of Natural Recourses, were actually over at the Denver Museum of Nature and Science at the time announcing other environmental plans. Joining U.S. Agriculture Secretary Tom Vilsack, the governor released the final report for the so-called Colorado Roadless Rule, providing conservation for 4.2 million acres of national forest roadless areas in Colorado. The announcement ended a seven-year collaborative process between the U.S. Forest Service and state officials.
A spokesman for Hickenlooper, Eric Brown, said the governor and King simply could not attend both events.
“Clearly, they could not be in two places at once,” said Brown.
Hickenlooper, a Democrat, has actually led an active path regarding oil and gas regulation in Colorado, earning applause from both the industry and environmentalists over his approach. Despite being a supporter of fracking practices, Hickenlooper has helped establish Colorado as a national leader in developing rules and regulations governing fracking, requiring the disclosure of all chemicals used in the controversial drilling process.
He also convened an oil and gas task force to address local concerns with fracking. The task force has recommended increased collaboration between the state and local governments in bringing oversight and accountability to the industry.
The polarizing issue surrounding fracking was highlighted during the Congressional field hearing on Wednesday, with Republicans and Democrats drawing a clear line in the sand between supporting and opposing increased federal regulation of fracking practices. While Republicans would like to leave the regulations up to the states themselves, Democrats predominantly support a level of federal regulation.
The hearing featured two panel discussions, which included several Colorado oil and gas stakeholders. Also in attendance was state Rep. Jerry Sonnenberg, R-Sterling, chairman of the House Agriculture, Livestock and natural Resources Committee, as well as those cautious of oil and gas drilling operations, including representatives from Earthworks and Erie Rising, two groups dedicated to safety and regulation. Mesa County Commissioner Craig Meis joined the discussion, along with representatives from the oil and gas industry, and officials from Utah and Wyoming.
Members of the subcommittee, especially DeGette and ranking member U.S. Rep. Rush Holt, D-N.J., were at times curt in their questioning, asking panel members for short “yes” or “no” answers, and cutting off elaborations to get to other questions.
DeGette’s line of questioning served to prove her contention that there is a role for both state and federal regulation. “State and even local governments have a role in that they conduct the regulation of drilling, and the federal government has a broader role in setting standards,” she said.
“I can’t believe that the oil and gas industry and our panel here today actually think that anything goes in terms of the oversight,” said DeGette, who previously served on the subcommittee when Democrats controlled the U.S. House.
DeGette has addressed her concerns with fracking through legislation, introducing the so-called FRAC Act. The measure would repeal an exemption provided to the oil and gas industry, requiring operators to disclose the chemicals they use in fracking operations. The industry is granted an exemption in the federal Safe Drinking Water Act, according to DeGette.
“I think we need to get a scheme where each level of government’s role is clarified and decided, and I think there is a role for each level of government,” continued DeGette.
Sonnenberg, who on the same day ran a bill that would prohibit the distributing of severance tax dollars to local governments that delay or halt drilling operations, said federal regulations would be “devastating” to the state’s economy.
“These means and concerns are best addressed by those that understand our state, our people, our land and our industry,” said Sonnenberg. “Those people are the ones that live and work right here in Colorado.”
Sonnenberg had the support of the Republican members of Colorado’s congressional delegation who attended the hearing, such as Coffman, who also argued that state leaders are best equipped to handle the regulatory practices.
“These decisions are really best made at the state level… and I think it’s an insult to our state elected leaders and to our ranking leaders on the state level to say that they can’t do this job,” the CD 6 Republican said.
Tipton echoed similar comments, stating that local communities have a passion for keeping their communities safe. “We love our children; care about our communities — we want to make sure that it’s done safely,” he said.
Bill to regulate fracking
State Sen. Morgan Carroll, D-Aurora, also wants to make sure that fracking is done safely. She has introduced Senate Bill 107, which would require the Colorado Oil and Gas Conservation Commission to establish rules to protect groundwater from fracking contamination.
Operators would be required to submit water quality reports, and to take out a so-called “environmental bond” that would be forfeited if the operator causes damage to water supplies. Fracking would also be prohibited within a half-mile of any surface water, unless the operator uses a closed-loop pit storage system.
The Democratic-controlled Senate Judiciary Committee backed SB 107 on Wednesday by a vote of 4-3. The measure heads to the Senate Appropriations committee, and then possibly to the full Senate. But even if it gets out of the upper chamber, the measure still faces an uphill battle in the Republican-controlled House, where concerns have been raised over adding to the bureaucracy that governs oil and gas development in Colorado.
Addressing concerns that the legislation goes too far, Carroll answered, “This bill does not stop hydraulic fracturing; it doesn’t ban the practice — what it does is try to ensure that we have some targets and goals as far as best practices…”
She had the support of dozens of citizens and environmentalists who are concerned about the impact fracking might have on their health.
But others disagreed, siding with industry stakeholders who stated over and over again that Colorado already has and continues to implement rules and regulations governing drilling operations, adding that there has never been a documented instance in Colorado of water contamination from fracking.
Sen. Ellen Roberts, R-Durango, agreed, wanting to first give the Oil and Gas Conservation Commission the opportunity to regulate the industry.
“People have been led to believe that this is an uncontrolled rampant oil and gas industry telling Colorado how it’s going to be done, and I just don’t think that’s true” said Roberts.
“There is harm in passing this,” she added. “We have got to be cognizant of at the same time that while we are trying very hard to regulate this industry and make sure that people are safe… we also have to be aware that this is a huge economic driver in our state.”
But Carroll said economic drivers couldn’t be the only motivation. She said that while there are already rules and regulations in place, additional rules could enhance enforcement around safety.
“This is one of the bills we do that is actually of statewide interest to a lot of different people in this state,” she said.