The vote was 3-3, with Erie Mayor Andrew Moore, Mayor Pro Tem Brandon Bell and Councilmember John Mortellaro voting in favor of the agreement.
Councilmembers Emily Baer, Brian O’Connor and Anil Pesaramelli voted against, while Councilmember Dan Hoback was absent from Tuesday night’s meeting for, he said, a family obligation.
The proposal’s defeat capped months of debate over a potential deal. Opposition to the agreement with SM Energy — including some council members and Erie residents — that too much of the negotiation process with the oil and gas operator occurred in executive session, a type of meeting closed to the public.
In a written statement from Hoback that appeared in a document tied to Tuesday’s meeting, he said: “For the last six months, Erie Town Council has been negotiating behind closed doors for the sale of its mineral rights.”
Speaking toward Erie residents, Hoback’s statement added: “You came out in person both in council chambers and on the street, in emails, and in social media. The message has been clear. Residents are broadly and strongly opposed to the sale of the town’s mineral rights.”
Draco is expected to still move forward. But with the failure of the potential deal to win a council vote, the project will have to adjust its drilling plan to avoid the town’s minerals, the town said in a news release Tuesday night.
A plan for the Draco Pad was approved in March 2025 by the Colorado Energy & Carbon Management Commission, designed to include 26 wells drilled from a pad in unincorporated Weld County, before extending over 7,000 feet underground, turning horizontally and running west for more than 4 miles beneath portions of Erie and unincorporated Boulder County.
But before drilling can begin, SM Energy must demonstrate it has access to the underground mineral resources included within the approved plan to secure a drilling permit from the commission.
The town has said it was first approached in 2025 by Civitas Resources — which earlier this year merged with SM Energy Company — about acquiring Erie’s mineral rights within the proposed drilling area for Draco. Mineral rights allow their owners to access and extract underground resources or lease and sell that access.
Had the potential deal gone forward, SM Energy would’ve acquired what the town has said are about 180 acres of the town’s unleased mineral rights within Draco’s about 4,000-acre planned drilling area.In return, Erie could have received more than $21 million in combined cash and future revenue, including a $4.5 million cash payment and 3% of production revenue for the life of the Draco project; Erie officials had estimated that revenue share could exceed $17 million over the next 20 years or more, according to earlier town information.
The deal would have also seen Erie take ownership of three parcels of land totaling about 160 acres on County Line Road, according to earlier town information.
Erie spokesperson Gabi Rae said the town was given “every indication” that the SM Energy agreement “was the ‘best and final’ we were going to get from the company.”
When asked whether there is a possibility of negotiations continuing, Rae said: “I mean… in theory, the Council could vote to try to start up new negotiations, but then SM Energy would also have to be on board with that.”
“Ultimately, whether or not any future conversations happen is a policy decision for Council to make,” Rae told the Camera in an email Wednesday.
Under , SM Energy will now have to avoid Erie’s mineral rights. According to the state ECMC, that could require an amendment to the Draco plan, and new review by the commission before the project can move forward.
“The Draco plan approved in 2025 is in the pre-construction stage; itap not uncommon for operators to file amendments before the surface pad has been built and the site has obtained additional ECMC approval for drilling,” John Brown, a spokesperson for the commission, told the Camera in May.
June 16, 2026 – Town Council Special Meeting
Watch recorded Town Council Special Meeting
