2011 Colorado legislation: HB 11-1286, Clarify [State Engineer] Nontributary Rule [Authority]

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From The Pueblo Chieftain (Patrick Malone):

The House Agriculture, Livestock and Natural Resources Committee voted 13-0 to adopt HB1286, sponsored by Reps. Jerry Sonnenberg, R-Sterling, and John Becker, R-Fort Morgan. The bill aims to streamline the decision-making process on water permits. A 2009 Colorado Supreme Court decision found that water used in coal-bed methane natural gas extraction is subject to the requirements of tributary water permitting. The ruling granted Water Courts authority over permitting conflicts and appeals…

Nontributary water can be exempt from permitting, Following the court’s ruling, the state engineer developed rules to govern permitting within the framework of the court’s decision, and developed a map that reflects extraction operations subject to permitting under it. Among them were some wells in the Raton Basin near Trinidad. Under HB1286, the state engineer’s rules would be acknowledged in statute, appeals of permit decisions would be routed through the rule-making process instead of through Water Court and further appeals of those decisions to a Water Court would require a higher standard of proof to overturn earlier rulings in the chain of appeals.

The chief opponent of the bill to testify Monday was lawyer Philip Lopez of the firm White & Jankowski, which represents the plaintiffs who were victorious in the 2009 case. He characterized the bill as an attempt to legislate around judicial decisions, argued the ruling has not led to the shutdown of any gas wells and said the state engineer’s map confers by default a water right to the oil and gas industry that other water users must follow process to attain.

More coverage from Joe Hanel writing for The Durango Herald. From the article:

House Bill 1286 raises the legal standard the ranchers will need to prove to win their lawsuits against State Engineer Dick Wolfe. Last year, Wolfe drew maps that showed which gas and oil wells needed to get water permits and which ones could drill without going to court to fight about who owns the water…

The Vance and Fitzgerald families took Wolfe’s office to court several years ago for not protecting their water rights from gas wells, and they won at the state Supreme Court in 2009. The ruling shocked the gas industry, and legislators worried all 40,000 gas and oil wells in the state would need to get water permits. So they gave Wolfe’s office the power to draw maps that show where gas wells interact with surface water. Gas wells outside the zone do not need to replace the water they use because the water is assumed to be so deep underground that it will have no effect on surface streams.

But the Vance and Fitzgerald families sued again, along with the San Juan Citizens Alliance, the Oil and Gas Accountability Project and the city of Sterling. Several lawsuits are active, and the main one is working its way through the water court in Greeley…

Mike King, director of the Department of Natural Resources, urged legislators to pass the bill. Wolfe’s office is in King’s department, and King cited the extensive work the engineer’s office did to draw the maps. “What we’re asking is an affirmation of that to remove all doubt,” King said. “This is critical that we resolve this issue and that it doesn’t get litigated and then appealed to the Supreme Court, and we have a two-year window of uncertainty that would not be good for oil and gas production in Colorado.”

More 2011 Colorado legislation coverage here. More coalbed methane coverage here and here.

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