The city of Loveland approved its first conditional well-pad application to drill and frack 15 bore holes on a pad about six miles east of the city center.

Significant conditions were placed on the conditional approval, including the use of all-electric drilling equipment and requiring the use of low-emitting Tier IV diesel engines for fracking equipment that cannot be electrified.

The application was submitted in March, 2022 by MRG, LLC, a subsidiary of McWhinney, a commercial, residential and hotel development firm owned by Colorado developers Chad and Troy McWhinney.

A city news release on the approval Monday said the application process took more than a year to complete, with extensive consultation with city departments and the Colorado Department of Public Health and Environment.

“The file on this matter is extensive and addresses issues such as emergency response, landscaping, interim reclamation, storm water controls, noise mitigation, dust mitigation, and air quality protections,” said Development Services Director Brett Limbaugh in his decision letter. “City staff put forward 23 conditions of approval that are now binding on this operator. Additional conditions this permit requires are, in some cases, more protective than state regulations.”

The company had originally submitted applications for two drill sites, but withdrew an application for a site that would have directionally drilled under McWhinney’s planned 140-acre mixed-use Centerra South community located west of I-25 and south of Highway 34.

The approved well site is located north of Highway 34, east of I-25 and the Kinston Centerra subdivision and west of North County Road 3.

Loveland imposed enhanced oil and gas standards in 2018, and this is the first application to be approved under those standards.

The city’s standards are more stringent than state standards, something made possible by the passage of Senate Bill 19-181. That law was seen as a controversial reaction by the state General Assembly to the defeat of 2018’s Proposition 112. That citizen-initiated measure would have increased setbacks for oil and gas wells to 2,500 feet from residences, schools and other areas. The measure was defeated by 54% to 46%. To pass, the measure would have required 55% approval.

Other conditions include a 24-hour point of contact for citizen complaints and air monitoring, including pre-drilling baseline testing and ongoing monitoring with weekly reports to the city.

The conditional approval must also pass muster with the Colorado Energy and Carbon Management Commission, formerly the Colorado Oil and Gas Conservation Commission, that was renamed by Senate Bill 23-285 in July. It broadened the commission’s regulatory authority to include the regulation of certain geothermal resource operations and intrastate underground natural gas storage facilities.