Steamboat Springs Shell Oil’s willingness to go beyond the state of Colorado’s requirements for safeguarding domestic water wells in the vicinity of Milner won it praise Tuesday from all three Routt County commissioners and a unanimous vote of approval for the Camilletti oil well about 11 miles west of Steamboat Springs.
“I commend Shell for going the extra mile and expanding the radius for (well water) testing,” Commissioner Steve Ivancie said. “You’re an example of a responsible extraction company, and I hope if economics change, you’re back in Routt County and continue to explore here.”
Shell has announced its intent to gradually divest itself of its interests in the Sand Wash and Niobrara field and turn itself toward other opportunities, but it is continuing to live up to agreements in place with a variety of entities that include deadlines for drilling wells, like the Camilletti well, among other things.
Like Ivancie, Commissioner Tim Corrigan was open to a change of plans.
"I think, over a period of time, we’ve had a series of meetings, and we're getting to the point where we could have what we could consider a partnership,” Corrigan told Shell representatives Anne Baldrige and Steve Compton. “I’d like to continue that partnership.
“I’d like to hope other developers would consider using Shell’s model. You guys have established a great baseline for how business should be done here in Routt County,” Corrigan continued.
The permit hearing at the Routt County Courthouse was held in front of an audience of 25 interested people, nine of them employees or representatives of Shell. Two members of the public spoke in favor of Shell’s application.
Compton told the commissioners that Shell intends to go beyond state regulations to sample more wells than required and to return more frequently than required to sample the wells after drilling is completed.
The new Colorado Oil and Gas Conservation Commission Rule 609 requires energy companies to look within a half-mile of a well bore to find as many as four water sources to test. Shell was able to find only one abandoned well and a single spring within that circle, but the spring alone would have satisfied the state.
“We didn’t feel that was adequate coverage, and we understand concerns within the community,” Compton said.
Broadening the search to a 1-mile radius, his team was able to identify seven more wells (for a total of eight wells and one spring), and the search appeared to have supplied an ideal range of wells drilled at different depths into different aquifers, Compton said. But three of the additional wells also proved to be abandoned, and although it has acquired permission to monitor the remaining three, Shell has been unable to get into the field this month to determine whether they are accessible.
However, the company decided this week to expand its search to the Milner neighborhood south of U.S. Highway 40 in order to eventually identify a total of five wells in addition to the spring to be tested.
The Oil and Gas Commission requires the company to come back one year after the well is drilled to repeat the water quality tests and a second time after the fifth year, but Shell will test the wells annually for five years and then come back to test one last time after the production phase is over and the well has been sealed, Compton said.
The commissioners agreed to issue Shell its permit on the condition that before it begins drilling it will sample and test five wells and submit the list and a map of the locations to the Routt County Planning Department staff prior to drilling. The results of the testing will be made public by the Oil and Gas Commission.
Tuesday’s vote marked the second time the county has voted to issue a permit for the Camilletti well. The past Board of Commissioners voted to grant the permit in July 2012 to Quicksilver Resources. But the company, objecting to more stringent water quality testing requirements, ultimately withdrew its application.
Commissioner Doug Monger said at the end of the hearing that in hindsight, he thought he and his former colleagues on the board might have been overreacting to an atmosphere of fear about oil drilling practices.
“I think we stepped quite a bit beyond what might be reasonable now,” Monger said. “I’m very much more comfortable. We are very concerned about those 44 wells in the Milner area. Hopefully, we’ll never have anything to worry about.”
Corrigan said he can imagine future well permit applications when state rules are adequate to protect water supplies. But he said it would have been difficult to vote in favor of the permit for the Camilletti well without Shell’s willingness to go beyond state requirements because of the large number of domestic wells in close proximity.
Baldrige said with winter approaching and a prohibition of construction and drilling activities during grouse mating and rearing season stretching from March into late July, it’s unlikely that the access road or the well drilling will take place before late summer 2014.
To reach Tom Ross, call 970-871-4205, email tross@SteamboatToday.com or follow him on Twitter @ThomasSRoss1
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