Denver (Platts)--15Aug2012/414 pm EDT/2014 GMT
Local ordinances that seek to limit fracking -- such as the one passed in Longmont, Colorado -- could set a dangerous precedent, leading to a confusing patchwork of regulation that stifles natural gas development, the governor of Colorado said Wednesday. John Hickenlooper, a Democrat, made the statements on the sidelines of the Colorado Oil & Gas Association's Energy Epicenter Conference in Denver. Last month, the state took the unusual step of suing the city of Longmont to stop enforcement of new oil and natural gas regulations which state officials said overstep the city's authority. The suit was filed July 30. It marked the first time the state has sued a city to challenge its right to enact regulations on oil and gas development, although some local ordinances have faced court challenges in the past from oil and gas operators and other third parties. The Longmont rules, passed by City Council on July 17, include a restriction against hydraulic fracturing in residential areas, a requirement to fully disclose any hazardous materials transported on city roadways, and several other provisions. During a panel discussion at the conference, Hickenlooper said such local ordinances will lead to "an intensely balkanized, patchwork quilt" that could deny stakeholders their mineral rights. In addition, the ordinances could stifle development of natural gas at a critical time when the industry is going through a technological revolution that has released previously untapped reserves in shale plays and other formations. He also said he was hopeful that the lawsuit could be settled, avoiding a long and expensive court battle. Local governments in Colorado have much more control than in other states on how they deal with many social services such as food stamps, the governor said, but "this is one case where there has to be a limit ... to forceful new regulations." Hickenlooper also said that the decision to sue Longmont was painful and caused him to lose sleep because he is "a big believer in local control." Longmont Mayor Dennis Coombs said last month he believes the town's new regulations are not in conflict with state oil and gas rules, and that the state is simply challenging the rules to create a test case on the issue of state versus local jurisdiction. The regulations, which the council passed to update the city's 12-year-old drilling ordinance, are designed "to protect the municipality and its citizens from the risks associated from industrial activities," he said. In a separate effort, groups concerned about fracking are trying to amend Longmont's city charter to ban the process and collected enough signatures to put it on the ballot in November. Hickenlooper told reporters at the conference he is eager to meet with anti-fracking groups and listen to their concerns but that a ban on hydraulic fracturing is not reasonable. "We tested 6,000 water wells and 6,500 oil wells and we can't find frack fluid in subsurface ground water ... to ban it seems unreasonable to us," he said.--Eunice Bridges, eunice_bridges@platts.com --Edited by Jason Lindquist, jason_lindquist@platts.com