Agreement puts halt to Extraction drilling plans while Boulder County lawsuits await resolution

An oil and gas company seeking to drill 21 wells in Weld County on land that abuts Boulder County will have more time to firm up its plans before its permits expire. The additional time also will allow legal challenges to the drilling plan to make their way through the courts.

“Over the weekend, Boulder County, Extraction Oil & Gas, Inc., and the Colorado Oil and Gas Conservation Commission agreed to a process that will protect the county’s conservation easement property in Weld County from Extraction’s plans to drill wells in mid-November while the county’s lawsuits against Extraction proceed in the Colorado Court of Appeals,” the county announced in a Monday news release.

Boulder County has filed two lawsuits challenging Exraction’s legal right to drill on the land where the well pad is proposed, which is owned by a Boulder County conservation easement. Last week, the county asked the COGCC to suspend Extraction drilling activity until those suits are resolved by the appeals court. 

Extraction will ask the COGCC to extend the expiration date of its state-approved drilling permits until after the county’s two cases against the company have concluded, according to the release. The January 2021 expiration of those permits was the primary driver for Extraction’s plans to start work later this month, the county stated in the release. 

Extraction filed for bankruptcy in June, which put a pause on the lawsuits. The county last week also filed an emergency motion in the Delaware bankruptcy court for permission to move forward in the Colorado courts.

“Chances of success when fighting emergency motions in court are always uncertain, and even more so when there are two courts involved as there would be here,” Senior Assistant County Attorney Kate Burke stated in the release. “With this agreement, Extraction’s motion to COGCC to extend the timing of their permit approvals will be unopposed, which eliminates much of that uncertainty.”

Under the agreement, once the extension of the permits from COGCC is in place, Extraction will shelve its construction plans until after all the litigation is fully concluded, according to the release. 

In its variance application to COGCC, Extraction attorneys stated the company “has sought, in good faith, compliance with the current expiration dates … but has been hindered from commencing well pad construction, facility pad construction, and drilling operations ... due to the current litigation, and that extending the expiration dates “would allow for the efficient and economic extraction of hydrocarbons, would prevent waste, would not damage correlative rights, and would not endanger public health, safety, welfare, or protection of the environment and wildlife resources.”

The county will withdraw its emergency motion with the Delaware bankruptcy court, according to the news release. 

“It is important that the county have its day in court defending our conservation easement, and not have an oil company go ahead and drill using the excuse that they are in bankruptcy court to get around our lawsuit,” Commissioner Matt Jones stated in the release.