Oil and gas company wants to extract Boulder County minerals

Boulder County is looking for public input before deciding whether to lease mineral rights to an oil and gas company or risk being forced to share in the cost of the project.

On July 5, Boulder County received a letter from Extraction Oil and Gas related to the company’s “Blue Paintbrush” well pad planned in Weld County. The Blue Paintbrush pad is located approximately 1,000 feet east of the Boulder County line on land that Boulder County has a conservation easement on.

Extraction has permits from the Colorado Oil and Gas Conservation Commission, or COGCC, to drill up to 32 oil wells on the Blue Paintbrush pad. The wells of this pad are designed to drill horizontally from the Weld County site to produce oil and gas under four square miles of Boulder County, where Boulder County is the majority mineral owner.

Boulder County filed a lawsuit in 2018 arguing that its conservation easement and several existing leases do not allow for the approved drilling, but the suit was unsuccessful.

The letter from Extraction laid out two options for the county: lease the mineral interest and receive a proportionate royalty share, or join the company as a working interest owner by paying the costs of operations and receive a proportionate working interest share.

Extraction’s offer letter states that if the county does not agree to lease 552 acres of mineral rights or accept a working interest in the Blue Paintbrush wells, the company will seek a statutory or forced pooling order from the COGCC. Extraction filed an application with the state to force pool the minerals on July 7, and that is currently in a regulatory waiting period.

If approved by COGCC, the pooling order would require Boulder County to allow its mineral interests to be accessed by Extraction while also requiring the county to share in the cost of drilling and producing the oil and gas.

“Boulder County believes it has a strong arguments against forced pooling, but the outcome of a COGCC proceeding is not certain,” the county said in a release. “Boulder County has a long-time policy of not voluntarily leasing its mineral rights for development. However, considering the threat of forced pooling and the significant amounts of land, minerals and money at stake in this situation, the county will complete a full public process before rendering a decision on the offer.”

The Boulder County Parks and Open Space Advisory Committee will review Extraction’s lease offer at a public hearing scheduled for 7 p.m. Thursday. The proceeding will be the first step in the process by which the county determines whether to dispose of open space property by selling it or, in this case, leasing it for development, the county explained.

After a presentation from county staff and hearing from public commenters, the advisory committee will make a recommendation to the county commissioners.

To provide comments to the committee before Thursday, sign up to speak, or view the meeting remotely, go to boco.org/posac. Spanish interpretation will be provided for registered participants.

Depending on the number of people signed up to speak, speaking time may be limited to three minutes. Speakers are requested not to repeat statements made by previous speakers other than to express points of agreement or disagreement.

After the advisory committee makes a recommendation to the county commissioners, the board will accept public comments on the issue at [email protected]. The public will also be able to speak when the commissioners take up the question at a public hearing scheduled for 4 p.m. on Nov. 1.