Thanks to the hard work of our Alliance’s membership, Colorado is once again leading the way toward a healthier, safer, more responsible way of developing oil and gas in our state. In March, the Colorado Oil and Gas Conservation Commission (COGCC) adopted new rules increasing the number of money operators set aside to clean up their oil and gas wells at the end of their productive life.

Plugging a well and reclaiming the land it was drilled on is an essential end final step to prevent the venting of toxic chemicals and climate-warming methane into our air, as well as to protect our water and soil from contamination. However, plugging and reclamation is expensive, costing tens of thousands of dollars per well. This has led to many operators walking away from their mess, leaving it for the public to live with the consequences and foot the bill for cleaning it up.

With input from our Alliance, the COGCC has taken several steps to solve this problem in Colorado. Operators are required to set aside the full cost of plugging and reclaiming most low-producing wells, establish a timeline for the cleanup of potentially 10,000 such wells, and apply these new state rules to wells and sites on federally-owned lands. The rules also require the bonding of high-risk wells transferred between operators, and bolster the state’s orphan well fund through operator-paid fees.

While the success our Alliance experienced is historical, opportunities to further improve the COGCC’s financial assurance rules remain. In particular, broad discretion still exists for the COGCC to approve permits for operators without clear and convincing evidence of their financial health. Also problematic is the existence of blanket bonds that allow large operators to have an unlimited number of oil and gas wells despite the bond amount potentially covering just a fraction of the price of clean-up.

Despite these challenges, Colorado and our Alliance have taken major steps to protect public health, safety, welfare, wildlife, and the environment. Looking forward, the COGCC needs to substantially increase its staff to enforce its new regulations, and the state legislature must create an enterprise fund for the orphaned well program’s finances. Our Alliance is looking forward to monitoring the state’s progress, and doing our part to hold both operators and decision-makers accountable.