Colorado oil and gas regulators on Tuesday approved a controversial 24-well drilling operation that will sit just over a half-mile from hundreds of Aurora homes and a reservoir that serves as the city’s primary water supply.
The 3-2 vote by , in favor of the State Sunlight/Long well pad proposed by Crestone Peak Resources, came after about five hours of testimony and deliberation. The decision ends what had become one of the more contentious battles over energy extraction in Colorado.
Board Chair Jeff Robbins acknowledged that the application from Crestone had evoked a strong reaction from homeowners living nearby. But in the end, the company complied with rigorous state oil and gas regulations enshrined in a law known as Senate Bill 181, which was passed by state lawmakers seven years ago.
“At the end of the day, State Sunlight/Long achieves the balance we were told to look for,” Robbins said.
The two commissioners who voted no were Trisha Oeth and John Messner. The approvals process for the Sunlight/Long well pad encompassed seven hearings before the commission, stretching over several months.
Nearby homeowners rose up in opposition, claiming that the project would pose health hazards to those living nearby — in particular, to school-age children. They also worried about the drilling’s potential environmental impacts on the Aurora Reservoir, which is a water source for the 400,000 residents of Colorado’s third-largest city.
“I cannot believe that the state came down on the side of the industry yet again,” Randy Willard, the president of opposition group , said in an interview minutes after the vote came down Tuesday afternoon. “The group as a whole is severely disappointed.”
The group had pushed back on the proposed project using the 2019 oil and gas reform law as a guide, Willard said.
The 2019 law prioritized public health, safety and the environment when regulators consider oil and gas development — a profound change from the industry-focused approach Colorado had taken for decades.
“We’ve done everything we feel is possible under 181, only to find the industry comes out on top yet again,” Willard said. “I don’t know what else we’re supposed to do.”
In December, the state commission voted 4-1 to put a stay on the project, ordering Crestone to return with a list of alternative sites from which it could drill.
Crestone, a subsidiary of Denver-based SM Energy Company, came back this month with a slimmed-down proposal, knocking down the number of wells at Sunlight/Long from 32 to 24.
The company insisted that after examining 11 other potential sites, most of which were farther away from homes, its preferred site near Aurora’s Southshore neighborhood and the reservoir remained the best place to locate its wells.
Civitas Resources was Crestone’s parent company until late January, .
Jamie Jost, an attorney for Crestone, spoke to the commission during an online hearing Tuesday that, at one point, was attended by nearly 1,000 people. She called the site the “most vetted, most analyzed” location for the pad.
The company said the site would have the least impact on wildlife and waterways across 26,500-acre Lowry Ranch, a stretch of rolling prairie owned by the Colorado State Land Board where Crestone has plans to drill just over 100 wells in total — down from 166 just a couple of years ago.
Dan Harrington, SM Energy’s asset development manager, told the commission that reducing the number of wells at Sunlight/Long would curtail the time needed for drilling and fracking.
“This will reduce operational duration by about 25%,” he testified.
And the scaled-back operation will emit fewer emissions, including of carbon dioxide, nitrogen oxide, volatile organic compounds and methane, the company in favor of its preferred site.
Mike Foote, a former Democratic state lawmaker who represents the neighbor opposition group as its lawyer, testified that Crestone didn’t conduct an honest comparison of alternative sites.
“It found things wrong with everyone else’s suggested sites instead of coming up with something that worked,” he said.
But Nathan Bennett, SM Energy’s director of permitting and compliance, said Crestone looked at other potential locations with an open mind. The company, however, said the alternate sites had problems, with questions raised about whether Xcel Energy could provide electricity to some of them to power electric drilling equipment.
Other locations, the company said, would have required much longer truck trips and called for running pipe over more ecologically sensitive areas.
Commissioner Mike Cross said Crestone’s proposed site for Sunlight/Long was well outside the state’s required 2,000-foot distance buffer from homes. He said the company’s commitment to use quieter and cleaner electric equipment on site was a positive aspect of the project.
“The best practices that we’ve seen from operators in the state, we’ve seen in this application,” he said. “It does meet our rules.”
But Willard, who has been working to defeat the application for nearly two years, said neighbors were already complaining of noise from other Crestone drilling operations on Lowry Ranch. In a presentation that the opposition group ahead of Tuesday’s meeting, the group claimed that more than 40 noise complaints were filed with the agency last month alone.
That, Willard said, will only increase once drilling starts at Sunlight/Long in the coming months.
