Oil Shale/Oil and Gas Update

Colorado Confidential takes a look at oil and gas drilling hearings and legislation and the 25th anniversary of “Black Sunday,” the day Exxon pulled the plug on oil shale development in the Rifle area-May 2nd, 1982. The Special Congressional Roan Plateau Drilling Meeting: Is It or Isn’t It?

Hint: If you are interested in the subject of drilling on the Roan Plateau, a unique area west of Rifle, you might reserve Friday, May 4th for a possible trip to Glenwood Springs. This potential Congressional discussion over drilling in the Roan by the members of the House natural Resources Committee next week upset the Independent Petroleum Association of Mountain States and prompted them to send out a pointed press release.

Bobby McGill from the Grand Junction Daily Sentinel reported:

Energy companies are “bracing” for the House Natural Resources Committee hearing, IPAMS claimed in the news release, which did not say which congressmen may be involved or provide a time or location for the hearing. It said the hearing will conflict with the “Fueling Thought: Trends in Energy” symposium scheduled for May 4 in Craig.

Tara Trujillo, spokeswoman for Rep. John Salazar, D-Colo., said Thursday that such a hearing may be “under discussion” but nothing has been scheduled.

Salazar and Rep. Mark Udall, D-Colo., visited Glenwood Springs in February to talk about the Roan Plateau at the invitation of conservation groups who want to the congressmen to introduce legislation curtailing potential energy development atop the Roan Plateau.

The news release said the hearing was announced with one week’s notice, preventing Republicans, who no longer control the House Natural Resources Committee, from attending the hearing.

Why the interest of the Roan Plateau as a “line in the sand” for gas development in the West? Duke Cox, member of the Western Slope drilling watch-dog citizens group Grand River Citizens Alliance, explained: “I think conservationists consider it the back door to drilling in environmentally sensitive areas like the Arctic Refuge. If the Roan can be drilled, any place is viable.”

The 25th Anniversary of “Black Sunday” May 2nd

A brief press release announced Exxon’s departure on Sunday, May 2, 1982. The gates were locked at Exxon’s Parachute plant. Thousands of oil shale workers were out of a job in seconds. The economic repercussions in northwest Colorado, especially in Grand Junction, Rifle, Parachute and Meeker influenced the area for over 15 years. Many lost their homes and businesses.

This Colorado Confidential reporter is among the group of Rifle “survivors” from the Oil Shale Bust days and there are a few stories to relate of that fateful time. A favorite souvenir T-Shirt says “Exxon” “Exxoff” “ExxGone.” (Incidently, Exxon-Mobile announced “they’re baaaccckkk” in the oil shale business last week.) Stay tuned.

EnCana Oil & Gas Plans Energy Expo on…..May 2nd…..

From the Rifle Citizen Telegram:

EnCana Oil & Gas USA staffers weren’t initially aware that the date of their fifth annual Energy Expo was being held on the 25th anniversary of Black Sunday – the day Exxon pulled out of western Garfield County, leaving thousands without jobs.

But now they’re looking at it as positive reinforcement that the energy industry is here to stay.

“Is the date ironic?” said Kathy Friesen, education advisor for EnCana, who coordinates the Energy Expo. “In a way it is, but I hope that it is perceived as a positive that EnCana and the other companies are committed to being here.”

Friesen pointed out that the “boom” of the energy industry in the area again probably won’t be like the last.

“This one is a little more positive, stable and longer-lasting,” she said. “And the fact that we’re having our fifth annual (event) is positive reinforcement of the energy involvement in the area.”

Granted, there are few Oil Shale Bust survivors around to have noted the timing of the Energy Expo was…serendipitous.

Summer of Severance Tax

The severance tax committee resolution that was [proposed back in Feb. by Sen. Gail Schwartz (D-Snowmass Village) was approved by the Senate and the first meeting will be scheduled soon after the session ends next  month.

From the Grand Junction Daily Sentinel:

Under a proposal expected to receive its final Senate approval today, an 11-lawmaker panel and an 11-person working group including representatives from the Colorado departments of Local Affairs and Natural Resources would meet six times to study revenue collections and allocations and then, if needed, propose any needed legislation.

Rep. Bernie Buescher, D-Grand Junction, said with the explosion in drilling activities throughout Colorado, it is a good time to reassess how mineral funds are distributed.

“There are still impacts we’re not dealing with,” Buescher said. “There is no distribution to areas based on the actual drilling or extraction that’s going on in an area.”

Under Colorado law, the local severance tax distribution formula is based on where energy-industry employees live, not where they work.

For more information about severance tax revenues and why the interest (lots of money), check Colorado Confidential here and here; background about the committee proposal here.

New Oil and Gas Sheriff Coming to Town

The legislative bill that will reform the Colorado Oil and Gas Conservation Commission (HB1341), passed the state senate this past week and is headed to the Gov. Ritter’s desk probably next week.

From the Grand Junction Free Press:

The bill proposes to change the mission of the COGCC to put more emphasis on protection of public health and the environment and changes the make-up of the commission by changing the board size from seven to nine members while reducing the number of oil and gas industry representatives from five to three.

“This is one of the most important bills to cross the governor’s desk this year,” said Tr

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