For starters, we support House Bill 1268, a common-sense proposal that would require home sellers to disclose whether mineral rights to a property are owned separately or have been leased and if oil and gas companies have access rights to the surface property. This is a good idea that could reduce headaches through requiring disclosure.
We also support House Bill 1267, which would increase fines for oil and gas operators from the current maximum of $1,000 a day per violation to $15,000 a day.
Colorado's fines for oil and gas violations are among the lowest of energy-producing states and haven't been increased in decades. The proposed increases, we're told by Department of Natural Resources officials, would be comparable to those in other states, and industry officials either testified in support of the increased fines or were neutral.
But we can't get behind House Bill 1269. First, the bill would eliminate language in state law requiring the Colorado Oil and Gas Conservation Commission to foster the production of oil and gas in balance with environmental and public safety concerns. This goal should not be eliminated from the commission's mandate.
Second, the bill would bar any commissioners from working for the oil and gas industry. Current law requires the commission to have members who represent the industry, and we believe their knowledge of oil and gas operations is invaluable in regulation. Besides, the commission already has a policy that directs members who have a direct conflict in a regulatory case to recuse themselves.
Finally, we cannot support Senate Bill 202, which would require all wells to be inspected once per year, a requirement that would add an additional 65 inspectors and cost an estimated $8 million (which would be borne by the industry). The Department of Natural Resources has requested and will likely receive funding for an additional 14 personnel that include inspectors, environmental protection specialists and engineers.
Department officials, as well as those in the industry, say it's not necessary to inspect every well every year, with some having operated at low risk for years. And we don't believe it's right for lawmakers to proscribe to regulators how often wells should be inspected or how many inspectors are needed.
We think it should be the other way around.
These four measures are likely to be followed by other bills to address the drilling boom in Colorado. In our view, increased fines and improved disclosure are worthwhile efforts. But we have yet to see evidence to support the proposed changes to the state's oil and gas commission and inspection system.
The Denver Post, March 26