Perfect Compromise. Nobody’s Happy.
June 11, 2014 § Leave a comment
Colorado Governor John Hickenlooper’s compromise seems to have fueled the fire in the ongoing debate about fracking regulation, and more broadly about local versus state control. As noted in earlier posts, other groups including homebuilders join the oil and gas industry in its opposition to these measures.
Currently, 11 potential ballot measures are competing for interest-group money and Colorado voters. While some groups are looking to broadly ban fracking and other activities deemed unacceptable at the local government level, most are looking for more specific limitations on drilling. A central issue in the measures is the distance permitted between drilling rigs and homes. The state’s current regulations require a 500-foot buffer. Four of the proposals would increase setbacks for drilling rigs by distances from 1,500 feet to a half-mile–proposals that Hickenlooper recognizes would put the state’s economy at risk by eliminating almost 60% of drilling locations. Colorado has enjoyed an earlier economic recovery than many states in the union in large part because of the oil and gas industry.
Hickenlooper’s compromise attempts to find a middle ground but has effectively made no one happy. Although environmental groups argue the compromise proposal does not go far enough, his bill would permit local governments to enact health and safety standards more stringent than state rules, authorize local inspections of oil and gas sites, and authorize negotiation with operators for setbacks greater than 500 feet. While the “compromise” would allow drilling to continue, the measure imposes a level of uncertainty that could be untenable to companies as various measures imposed at the local level would likely trigger costly delays and legal appeals for companies.
White House Unveils Regulatory Agenda Including Hot Items for Pipelines, Oil and Gas
May 27, 2014 § Leave a comment
On Friday, May 23, 2014, leading into the Memorial Holiday weekend, the White House published its semiannual regulatory agenda (Unified Agenda) describing its plans for approximately 60 departments, agencies, and commissions across the federal government. Marking the fourth consecutive time the Obama administration has decided to slide its regulatory agenda under the door on the eve of a major federal holiday, the approach is becoming predictable.
According to the published agenda the following items impacting natural gas and oil transportation by pipelines and oil by rail are slated for this summer:
- A proposed rule by PHMSA to require excess flow valves on natural gas pipelines running through buildings beside single-family homes is slated for August 2014. The excess flow valve issue has been a focus of NTSB and Congress since the 2010 San Bruno explosion.
- PHMSA is scheduled to release a broad reassessment of hazardous liquid pipeline safety regulation, including rules regarding leak detection in July 2014. This was called for in the Pipeline Safety Act reauthorization in 2011.
- PHMSA plans to formally propose new crude-by-rail safety standards in July 2014. It is no surprise that new rules for tank cars are coming; how strict the standards advanced by the administration is yet to be revealed. Look for more information here when the rulemaking process begins.
A complete list from the Unified Agenda for the Department of Transportation can be found here:
Colorado Initiative 75: It’s not just about drilling.
May 24, 2014 § 2 Comments
A Colorado Supreme Court ruling gives a green-light for petitions to circulate on Initiative 75. If approved by voters in November, the initiative would enable cities and counties to set their own rules for oil-and-gas drilling, regardless of existing state and federal laws.
Recall that in February, Colorado health and environment officials already approved new rules to limit air pollution from oil and gas drilling in the state, including a plan to detect and reduce methane emissions.
Initiative 75, as currently written, would reach beyond oil and gas companies and give local governments the right to prohibit many other business. This could create interesting bedfellows as the political opposition to the controversial measure grows.