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Jared Polis, Democrats strike $140 million deal with oil and gas industry, environmental groups

By and 04/29/2024 | updated 2 years ago

Gov. Jared Polis and Democratic leaders of the Colorado General Assembly on Monday announced two bills that would result in the withdrawal of several ballot measures that were proposed for the November general election by the oil and gas industry, as well as by environmental groups.

The two bills deal with air quality, ozone mitigation and emissions, and a fee on the oil and gas industry to fund Democratic priorities on rail, housing, wildlife habitat conservation and acquiring private lands for public use.

While the governor said the legislation has buy-in from the state’s three top oil and gas producers and the environmental community, they did not attend Monday’s press conference. 

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Kait Schwartz, director of American Petroleum institute-Colorado, told Colorado Politics the industry “is committed to working with state agencies, stakeholders, and environmental groups to achieve our shared goals of safely producing affordable natural gas and oil, and improving our air quality standards.”

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“These bills are further evidence of that cooperation,” she added. 

The industry has said for years that regulatory and legislative certainty for business owners and operators is of utmost importance, Schwartz said, adding, “We are pleased to see that the governor agrees.”

Schwartz also pointed out that the regulatory landscape for the industry has been overhauled in recent years and it’s important that those recent changes be allowed to work.

There were scant details on exactly what’s in the agreement. It did not identify the ballot measures or similar legislation already working its way through the process that would be withdrawn. It’s unknown whether the bills will have bipartisan sponsorship or when they would be introduced, with just eight days to go in the 2024 session.

It’s also unclear how the fees would be levied against the oil and gas industry or the targets the industry will be expected to meet under the legislation on ozone and emissions.

In a statement, Democratic leaders of the House and Senate said the two bills “will create more permitting and enforcement authority for the state to reduce emissions, improve air quality, and reduce pollution in Colorado communities.”

“It will also generate significant new funding for transit and rail, as well as land and wildlife habitat conservation and restoration, from modest fees placed on oil and gas production in Colorado,” they added. 

Rep. Meg Froelich, D-Englewood, added that the measures “will help reduce traffic by increasing transit options, support new housing construction, and improve the quality of life for people across our state while investing in habitat conservation, increasing state wildlife areas, and restoring important lands and native species.”

The estimated cost to be levied against oil and gas producers to pay for transit, housing and public lands is believed to be about $140 million. 

The agreement is supported by Conservation Colorado, Earthjustice, Southwest Energy Efficiency Project, Green Latinos, and major oil and gas operators Chevron, Occidental, and Civitas, the statement said.

Sen. Byron Pelton, R-Sterling, whose district includes Weld County, the largest oil-producing county in the state and which ranks 11th in the nation, appeared flabbergasted by Monday’s announcement, and added he has not been involved in any of the conversations around the agreement.

“It looks like extortion to me,” Pelton told Colorado Politics.

All session long, he said, “we’ve heard that gas is hurting kids, kids with asthma, and now $140 million pays for transit infrastructure and now all is forgiven? This is right out of Tony Soprano’s playbook.”

“It bothers me that this is how government works,” he added. 

Pelton said he is glad the agreement would save the oil and gas industry, as well as the many jobs that depend on mineral extraction. 

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