Colorado Shale Investments

Brian Hicks

Written By Brian Hicks

Posted December 6, 2013

Colorado is producing more oil than the state has seen in the last half century, and natural gas has seen a rise of nearly 30 percent since fracking was incorporated into drilling practices. All the while, the Centennial State has seen its economy flourish by employing nearly 50,000 workers by the oil and gas industry.

super frackBut in the midst of its success, the state of Colorado has become a state divided. There are those who claim fracking brings many dangers including ground water contamination, air pollution, migration of gases and chemicals to the surface, increases in carbon dioxide, and even earthquakes.

Environmentalists are knocking on doors and even convincing some cities to take a stand against fracking, the process where water, sand, and chemicals are forced underground to break apart shale rock layers to release natural gas and oil.

Some of these cities are going so far as to put a ban on fracking, which is like putting a ban on oil and gas. And for a state like Colorado – a state that has always been an oil and gas state, and which fracks 95 percent of all of its wells – the very way of life for many Colorado residents is being threatened.

These same environmentalists are using fear tactics and misinformation to get cities to pass local legislation that is illegal in the first place. The truth is, fracking has come a long way since its inception, and it’s not the environmental risk that it once was.

The Colorado Supreme Court has already ruled that fracking cannot be banned.

The Lawsuits

But because of these fracking bans that go against state law, the Colorado Oil and Gas Association (COGA) has filed a lawsuit against the cities of Fort Collins and Lafayette, Colorado.

The claim not only protects the rights and interests of the oil and gas industry, but it protects the livelihoods of those who work the fields.

The COGA has already spent roughly $900,000 to oppose the ballot initiatives, according to The Denver Post, while anti-fracking groups raised about $26,000.

The bans imposed by these two cities go against the state’s Oil and Gas Conservation Act, which requires uniform regulation by state and local authorities.

COGA also contends that only the Colorado Oil and Gas Conservation Commission has the authority to regulate wells within state lines.

The city of Longmont also faces a lawsuit for initiating an ordinance that put controls on drilling and banned fracking in residential neighborhoods.

COGA has decided against suing the cities of Boulder and Broomfield – two cities that have also imposed fracking moratoriums. This is mainly due to the fact that Boulder has zero active wells and the Broomfield ballot was officially being recounted at the time of filing.

It was announced Tuesday that the Broomfield fracking ban was passed. That same day, the Broomfield Balanced Energy Coalition filed a lawsuit against the city, claiming it wasn’t allowed to monitor the recount.

Regardless of what happens in Boulder, Broomfield, or Longmont, the bans in Fort Collins and Lafayette stand, and lawsuits will proceed to put them to an end.

Fort Collins has a five-year moratorium on fracking within city limits, while Lafayette amended its city charter by strictly prohibiting fracking for oil and gas.

The Fort Collins ballot passed with 56 percent of the vote for the five-year moratorium, according to The Denver Post, while Lafayette passed its ban with a 60 to 40 percent vote.

You can’t blame the people for speaking their minds, and if a ban on fracking is what the state of Colorado really wants, then so be it. But to slander and falsely accuse in order to get your vote – that’s not the way to go about things.

Staying Active

Therefore, the COGA will continue to fight for what is right. The show must go on.

Colorado stands as the nation’s fifth-leading producer of natural gas and number nine in oil. And it gets stronger every day.

There’s an explosion of natural gas in Colorado’s Piceance Basin, which many are calling “The Gas Factory.”

But the Niobrara Shale stands out above the rest, stretching from Colorado into Kansas, Nebraska, and Wyoming.

With expectations so high, Colorado can ill afford to have cities try to regulate on their own terms.

Companies who stand to reap the rewards include Anadarko Petroleum Corp. (NYSE: APC), Noble Energy Inc. (NYSE: NBL), and others like Chesapeake Operating.

Fracking is a blessing and not a curse, and time will prove that.

If we move away from the producers, infrastructure is going up, too. Pipelines are being developed by SemGroup Corp. (NYSE: SEMG) and Plains All American Pipeline LP (NYSE: PAA) with their own separate projects.

There is a lot of promise in the state of Colorado – if only we could get everyone on the same page, it would come a lot easier.

But time is on fracking’s side.


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