Routt County defies state oil official, OKs Quicksilver permit

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Oil & gas issues in Routt County

— The Routt County Board of Commissioners on Tuesday night defied an eleventh-hour admonition from the acting director of the Colorado Oil and Gas Conservation Commission and approved an oil well permit with requirements for water-quality monitoring, which the board deemed necessary to protect 39 domestic water wells a mile away from the well in unincorporated Milner.

“We’ve been told we have an oil and gas commission that is putting stringent requirements on oil and gas operations. It simply is not true,” Commissioner Nancy Stahoviak said. “Protecting our water quality is a local concern. The (Oil and Gas Commission) has not helped us protect the water (wells) of Milner, which is why we are having to do it.”

A little more than an hour before the hearing was set to begin at 5 p.m., the commissioners received an email from Oil and Gas Commission Acting Director Thom Kerr urging them to not impose their own conditions of approval on Quicksilver Resources’ application for a permit to allow the company to drill an oil well on the Camilletti Ranch.

Kerr wrote that any plans to require Quicksilver to drill a well between the oil well pad and Milner to monitor groundwater quality would usurp his agency’s authority.

“I strongly encourage the county to refrain from attaching any technical conditions of approval to Quicksilver’s Camilletti 21-10 permit, including such conditions pertaining to water sampling and monitoring,” Kerr wrote.

But Commissioner Diane Mitsch Bush, plainly irritated with the timing of the email from Kerr, said the county has statutory authority over matters of land-use policy and a responsibility to its residents to protect their health, welfare and the environment. She added that she thinks the Oil and Gas Commission does not have an adequate number of inspectors to monitor thousands of oil wells across the state.

“The agency charged with protecting our air and water quality (in the context of oil and gas exploration) really doesn’t do it,” Mitsch Bush said.

Mitsch Bush said she thinks the county must take measures to protect domestic wells in Milner, about 11 miles west of Steamboat Springs, before any signs of contamination appear.

“What we are doing here is to build conditions that can mitigate impacts before they happen, including water quality,” she said. “Not after water wells in Milner are contaminated but before.”

Quicksilver has been through numerous and lengthy public hearings regarding the well at the county level, with one of them lasting until 12:45 a.m.

Quicksilver Senior Director of Governmental and Community Affairs Steve Lindsey said after Tuesday’s meeting that his company would redress its objection to Routt County’s water-monitoring condition with the Oil and Gas Commission and would consider taking it to the Attorney General’s office if necessary.

“Our goal from the beginning was to work in a collaborative way, but I think there’s a fundamental disagreement with the county on the conditions of approval,” Lindsey said. “We want to work within the procedures of the (Oil and Gas Commission) so that it is consistent from the state to local level.”

Lindsey and Kerr suggested that the assurances Routt County seeks for protecting groundwater are provided by the state’s oversight of the proper cementing and casing of the well bore.

Lindsey said that once the well is pressurized, any leaks of drilling fluids, for example, would be readily apparent.

“The pressure is monitored, and you can identify any issue immediately,” he said.

Among the county commissioners, Kerr and Lindsey, there are differing interpretations about how the county has participated in the Oil and Gas Commission’s local government designee procedure, which calls for a representative of the county — in Routt’s case, county planner Chris Brookshire — to inform the Oil and Gas Commission board in writing when the county wants to add conditions of approval to a state drilling permit.

After the Camilletti permit application was deemed complete at the state level Nov. 7, Brookshire submitted comments explaining that the county was concerned about contamination. She went on to assert that Quicksilver should develop monitoring systems to address those concerns, according to Kerr.

However, Kerr added that Routt County’s designee did not exercise its right to a hearing before the nine-member commission to demand that Quicksilver be required to monitor water quality.

“Why didn’t they do that?” Lindsey asked rhetorically after the meeting.

Stahoviak said she looked up a Oil and Gas Commission assessment of the Camilletti well location in which Kerr indicated the Routt County local designee had not commented on the well, a statement that was inconsistent with his letter Tuesday.

“That really concerns me,” Stahoviak said.

In his letter, Kerr sounded equally concerned that the county’s decision to impose its own water-quality testing measures at the Camilletti well could interfere with his agency’s ability to carry out state policies on oil and gas exploration.

“The county’s imposition of a costly water-sampling plan will usurp the (Oil and Gas Commission’s) authority to minimize adverse impacts arising out of oil and gas development, will bypass the (Oil and Gas Commission’s) permitting regime and related safeguards, and will impede the state policy ‘to encourage, by every appropriate means, the full development of the state’s natural resources to the benefit of all of the citizens of Colorado,’” as required by state statute, Kerr wrote.

To reach Tom Ross, call 970-871-4205 or email tross@SteamboatToday.com

Comments

Steve Lewis 2 years, 5 months ago

Thank you Commissioners.

After attending many of these meetings and reading many of the related documents, including letters from the State departments to Routt (and to other counties), one aspect has been reinforced at every turn: the County’s concern is the continued well being of its constituents – in this case the residents of Milner. The County is also concerned about maintaining the positive role our clean environment plays in our local economy, from tourism to attracting location neutral businesses and new residents. The State’s concern, at every turn, has been clearing the way the next oil or gas well.

Given the PR problem this industry has presented in Colorado, I’m surprised the State would center its complaint on the extra costs of water quality monitoring. In the scale of exploration and production, even Quicksilver has said this cost is small.

And Shell is willing. For its Dawson Creek exploratory well, which renews its permit application with a BOCC hearing July 22, Shell has agreed to the monitoring well condition that Quicksilver now rejects. From their Revised Project Narrative, "Shell will follow the guidelines found in the new County Template COA #16 by installing a new groundwater monitoring well to be located down gradient from and within 300 feet of the drilling site…"

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Eric J. Bowman 2 years, 5 months ago

"Lindsey and Kerr suggested that the assurances Routt County seeks for protecting groundwater are provided by the state’s oversight of the proper cementing and casing of the well bore.

Lindsey said that once the well is pressurized, any leaks of drilling fluids, for example, would be readily apparent."

Weasel-word alert. Groundwater contamination can also come from leakage of stored drilling fluids, how would pressure monitoring of the well detect this source? If these fluids can't escape a cased well bore, then how do oil and gas get in? Since the proper pressure levels can't be known until the well is pressurized, how can an initial pressure loss due to improper capping/casing be detected?

So really, the only way to insure against contamination of Milner's wells, is with a monitoring well. Makes total sense to me; the CC should be applauded for having its priorities straight (water trumps oil), and the COGC ought to be ashamed of dumping this problem in CC's lap instead of protecting the water interests of impacted residents -- tough on them if they don't like that our CC's won't play ball with the special interests, can ya say regulatory capture?

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Scott Wedel 2 years, 5 months ago

The water monitoring well is not drilled to the same depth as the nat gas well. It is just drilled to the water table. And water testing is not that expensive. State lab provides testing for about $100 depending upon what is being tested. Not sure why that is viewed as too expensive or onerous.

Quicksilver should take this and be happy.

Because if a single water monitoring well between the nat gas well and all the wells for a community is considered too much by Quicksilver and the state Oil and Gas commission then the people and the legislature will change the rules. I doubt Shell and the rest of the industry would publicly fight against the idea of a single monitoring well between their nat gas well and all the water for a community. I'd guess that the rest of the industry is far more afraid of what sort of new rules will be passed if Quicksilver and the state Oil and Gas commission want to fight the need for a single monitoring well.

Sure, Quicksilver and state Oil and Gas commission is right that the leak should be detected in the nat gas well. That should be the primary method of detecting a leak. But is surely makes sense to have a back up plan that tests water before it reaches the wells for a community.

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mark hartless 2 years, 5 months ago

I would imagine the thing Quicksilver hates the most is not the cost of a single monitoring well. If I was just asking for this one single job I too would take this and be happy. But the precedent this sets when considering the desire of Quicksilver and the need in our country to drill many, many more wells??? That would make me re-think "taking this and being happy" when the state may yet intervene. Why not 2 monitoring wells next time... or 3... or 10? Why not monitoring wells for drilling operations 10 miles from Milner... or 20... or 50?

This is a classic example of the perils of trying to do business in a land where there are no rules other than what the mob makes up as we go along. This is true not only for oil drillers, but developers dealing with zoning issues, would-be farmers trying to produce locally, etc.

Why would anyone but a fool buy in to a poker game where the rules had not been set? We see the struggles of the Quicksilvers and Shell Oils. We see and hear the difficulties of locals like J Weibel trying to start a local business and it wrenches our hearts.

What so many Americans do not seem to see is the millions upon millions of other would-be investors, business starters, inventors, job creators and self-starters who see this conduct from local, state and federal government and simply opt to not even bother. For many, this is like the riddle about what a falling tree might sound like if nobody's there in the forest. What is really astounding is that, like the tree falling in the forest when no one is there to hear it, Americans can't see why on earth jobs are not being created here in the good 'ole USA.

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John Weibel 2 years, 5 months ago

Mark,

Their do need to be safeguards somehow. Sorry but a monitoring device to ensure that others property is not being harmed is not beyond reason.

There are far more reasons than simply government regulation in which jobs are being created elsewhere. The largest being the manipulation of currencies by other countries to make producing in their country the lowest cost. Other countries should also have to play by the same rules, in that they are trying to protect their watersheds, not tainting their food with melamine or other substances.

In order to have a free market, the costs that are being born by society in general, need to be accounted for in some way as far as a cost of producing that good.

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Scott Wedel 2 years, 5 months ago

Mark, Sure Quicksilver could be worried about onerous regulation.

But this is not it! A single monitoring well between the nat gas well and the water wells for a community is common sense.

You throw out several scenarios that make no sense and ask why not? That answer is in your scenarios, because 30 wells and monitoring far from the nat gas well makes no sense.

Quicksilver itself by saying they will test at existing nearby wells argues for the validity of testing nearby groundwater for contamination. Thus, the only substantial difference between Quicksilver's alternative plan and the County's requirements is that County wants any contamination found BEFORE it reaches residential wells while Quicksilver thinks it'd be fine to discover the contamination AFTER it reaches customer wells.

Quicksilver is acting like a completely irresponsible company that wants to exploit the weakness of current laws to insulate themselves from risks and hopefully be long gone before any groundwater contamination is discovered. They are making the case better than Steve Lewis or Kathy Foos ever could that regulation from the Oil and Gas commission is too weak.

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Eric J. Bowman 2 years, 5 months ago

Of course, if TPP happens, Quicksilver can just move offshore, then they'll be above local law -- they'll file a complaint with a foreign tribunal whose "judges" will consist of the corporate attorneys for Shell, BP and Exxon, who will find that Routt County owes Quicksilver all costs incurred by environmental monitoring.

http://www.sfgate.com/news/article/US-Pacific-Rim-nations-end-round-of-trade-talks-3696827.php

Note, no mention that any of this is in any way controversial, from the MSM. Nothing to see here, move on, move on... it's all a secret, dont'cha know?

https://www.eff.org/deeplinks/2012/07/21st-century-agreement-is-really-best-way http://www.citizen.org/documents/release-controversial-trade-pact-text-leaked-06-13.pdf http://www.citizen.org/documents/Leaked-TPP-Investment-Analysis.pdf http://www.citizenstrade.org/ctc/wp-content/uploads/2012/06/tppinvestment.pdf

So things are actually worse than the immediate problem of regulatory capture of COGC.

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mark hartless 2 years, 5 months ago

Folks, I never said the monitoring well was a bad idea. I never said a well was "onerous". It is a good idea. My point is that the rules should be in place before the game is played and that when they are made up as we go along it invites corruption, confusion, poor workmanship and, worst of all, it discourages participation by many who might otherwise add significant value to our economy in the form of investment, job creation, innovation and invention of new products, and the higher living standards all those things create.

Mr Weibel, Currency manipulation is made ever-more possible and is ever-more difficult to counteract when governments such as our own weaken our own bargaining position with massive debt. It's hard to stand up to ones banker when you are looking to him for your next meal.

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Eric J. Bowman 2 years, 5 months ago

I think having it come down to the County Commission needing to protect water rights, is evidence of corruption above -- an effect, not a cause. Yes, the rules should be consistent. But, when those rules are written by industry, for industry, without the proper safeguards for drinking water, I'm thankful this is a home-rule state where the local population is empowered, through its elected representatives, to step in and ensure the public health.

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John Weibel 2 years, 5 months ago

Agreed Mark. Debt is the largest problem we face today.

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Scott Wedel 2 years, 5 months ago

"It will be a long time before the city is able to recover from the massive waste of public funds that has occurred in the last seven years," Valles said.

http://articles.latimes.com/2012/jul/08/local/la-me-victorville-20120708

About the former city of City Manager Jon Roberts. Doesn't appear he was particularly responsible for the problems or particularly responsible for fixing the issues.

Maybe he learned something and so was willing to step forward and say the proposed city pay raises weren't sustainable.

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mark hartless 2 years, 5 months ago

If it is a "home-rule" state and if our commissioners have the authority to make this ruling stand then where is the evidence of rules being written by the oil industry? And if most municipalities are as "behind-the-curve" as Routt county was on this issue then it stands to reason that an industry that wants to operate efficiently, and which has a multitude of experts at its disposal might be expected to lend expertise to those who obviously stand in need of guidance. But lending expert opinions and even stating ones desres does not constitute "writing your own rules".

I hear stuff like that all the time and I admit there is oftimes way too cozy a relationship between industry and business, however, it is still government that writes the rules and they are still the responsible party.

To blame the mice for taking the cheese when your elected officials are supposed to be safeguarding it is to ignore where the responsibility lies. It also seems to be a favorite way for those who favor big government to excuse bad behavior and reckless spending on the part government while harping on the other dancing partner in such corruption; that being big business

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Glenn Little II 2 years, 5 months ago

What a great way to ruin the future of this county. Let's drill for oil instead of using safe alternatives. How backwards is this place, do I live in opposite world? So now all the people downstream are going to suffer not just literally but figuratively speaking as well..

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