Coalition forms to push back drillers from oil and gas-loving Denver

DENVER — It was just a matter of time.

A new front has opened up in the war over oil and gas drilling in Colorado just outside the city line on the northeastern rim of Denver, the state’s capital city and main population center.

This is the place where drilling opponents hope to make a stand that will turn the tide against the kind of in-close neighborhood drilling activity that has characterized recent boom-time operations in the state and stirred ballot box revolts in a string of smaller Front Range communities stretching north from here to Wyoming.

Today, a coalition of faith, health, environmental, business, community and labor groups are launching a “Don’t Frack Denver” campaign, which will press Mayor Michael Hancock and members of the City Council to effectively ban industry operations in the city and any that might contaminate the South Platte River Basin.

The coalition has a steep road to climb. Five cities on the Front Range have passed municipal bans or moratoriums in recent years, but most of those have been the target of legal action, and court rulings are piling up that are likely to overturn them. What’s more, Denver political leaders may be hard to sell on any significant opposition to the oil and gas industry.

The city is viewed by larger Colorado as a bastion of progressive politics, but it is at least a few notches down the spectrum from nearby Boulder, a university and tech startup town that sits along the gas-rich Wattenberg field. Boulder officials have taken cues from residents to ban fracking and join the first-wave movement among cities in the United States — like San Francisco, Santa Fe and Seattle — to commit to divesting from fossil fuels.

Denver is now and has been for decades the front office to oil and gas operations in the West. The industry rents 4.5 million square feet of downtown corner-office-and-cubicle space and pours out millions of dollars in donations to Colorado federal, state and local political campaigns

The city has also been the most direct kind of partner with the industry, enjoying a relationship many of the homeowners on the rim of the city now being drilled never had the chance to develop. Denver records obtained by The Colorado Independent show that the city for years has been engaged in the oil and gas business, literally — that it has contracted with drilling companies to work mineral leases owned by the city and to pay royalties for the oil and gas they pull up from the ground.

Indeed, a contract from 2010, bearing then-Mayor-now-Governor John Hickenlooper’s signature, records a city purchase for $5.5 million from Petro-Canada Resources of a mineral lease that contains 27 wells. The land dotted with those wells is spread out near Denver International Airport, and most of the wells were either completed or producing at the time the contract was signed. It is unclear from the documents how much revenue the city was generating from the wells, but it is the same general area now being worked enthusiastically by Houston-based industry giant ConocoPhillips, which expects to make at least hundreds of millions of dollars from extraction, and probably much more than that.

The ‘Sweet Spot’

Two years ago, Conoco moved strong into the greater-Denver area. It leased for a first five-year period 130,000 acres for $251 million. Executive Matt Fox called the area “a new sweet spot in the Niobrara,” which is the shale formation that spreads over the northern Colorado plains.

The company is reportedly looking to work a “long play” here, eyeing the high-stakes multi-billion-dollar ventures undertaken by Anadarko Petroleum and Noble Energy, two of the main companies working further north on the Front Range. And Conoco is moving fast. By May 2013, according to the Denver Business Journal, the company had drilled 11 wells on the land and set an ambitious tentative goal to drill 32 wells altogether during the appraisal phase of operations, in which it is assessing the leases to gauge what kind of minerals they contain — liquid or gas — and how best to draw them to the surface.

Conoco is still appraising, spokesman Jim Lowry told The Independent this week, but so far it is moving ahead of schedule. It has drilled 36 wells, 34 of which have been completed and 32 of which are now producing oil and/or gas for the company. The Conoco activity presents a picture of Colorado oil and gas development today. Drillers aren’t working amid wafting cow vapors or under the gaze of mountainside big horn sheep. Commercial jets streak low over the Conoco leases on a constant clip to and from the airport and cars with coffee cups bouncing behind their windshields stream on and off of the commuter highways that cross the play.

Local bedroom community residents have concerns. Although none of the wells are yet being worked within the city limits, Denver residents fear that it’s just a matter of time, that horizontal drilling, which stretches underground for miles in any direction, means it doesn’t even matter. They believe their neighborhoods eventually will be drilled, directly or indirectly. They are anxious that Conoco rigs will clog the roads and its trucks and wells fill the air with emissions. They also worry that the company could vastly expand dormant well-sites established decades ago in the area — like the one in Denver’s Green Valley Ranch neighborhood, where the well sits closer than state rules would now allow to the homes that have been built all around it.

Lowry said Conoco for now has no plans to sink new wells or to work older wells. The majority of the company’s leases he points out are located in Adams and Arapahoe Counties, which stack up around the eastern ring of Denver north to south and where the shale the company is “fracturing” or fracking — by blasting millions of gallons of mixed water, sand and chemicals to loosen the minerals — is reportedly 7,500 feet below the surface. Conoco drillers are already working the former Lowry bomb-test range in the area, the fields up and down Denver’s beltway Interstate 470 and residential areas of Aurora, a city of some 350,000 residents.

Conoco is clearly aware of the charged politics that surround fracking in Colorado now and of the potential for its “sweet spot” play to stir more controversy. Bill Ryan, director of the state land board, from which the company has leased 21,000 of its area acres, told the Business Journal in May that Conoco has been an “outstanding partner,” and that it has “embraced all the ecological studies” the land board asked the company to review. Lowry said Conoco follows all state rules and regulations, even as they evolve, and he adds that the oil and gas industry here is the most closely regulated in the country. He said Conoco is also committed to continuing what it calls “community investment” work, which so far has included giving money for flood relief to the state and holding eleven town hall meetings with residents, where Conoco “subject-matter experts” explain what the company is doing in the area and why.

In October, Conoco held a town hall at Murphy Creek Tavern in Aurora on the edge of Denver. A well “completion” expert told concerned residents that the wells Conoco was drilling were still exploratory and explained that the wells go thousands of feet below the surface, far below any water sources.

Some residents were not reassured. Town hall attendee Porscha Hicks-Plant looked over a sample drill pipe encased in steel and cement presented to the crowd by the speaker. “I feel like I want to sell my house,” she told the Aurora Sentinel.

Denver’s Crooked Left Arm

Rossina Schroeer-Santiago has watched these developments warily from her home in Denver’s Green Valley Ranch neighborhood, just a mile from Murphy Creek Tavern in Aurora. “We’re right here. There’s going to be fracking a mile from where I live — you see the traffic already,” she told The Independent. Schroeer-Santiago said she and her neighbors have been on the lookout for drillers since 2009, when news broke that Anadarko was looking to work the area. “You can see them moving their way around the checkerboard, down from the airport and up from Aurora. We’re going to be sandwiched,” she said. “It will be too close to homes and schools and it’s going to drive our property prices down.”

Schroeer-Santiago said she bought her home 15 years ago in “one of these ‘master-planned communities.’” She presumes the city or the housing developer owns the mineral rights under all the homes.

“No one I know owns their mineral rights out here. I didn’t even think to look into mineral rights. Who buys a house in a city and asks about mineral rights?” she said. “You go through the typical mortgage process. What banker in Denver talks to you about your mineral rights? You don’t expect drillers to come into your neighborhood.”

This part of Denver is City Council District 11, a crooked left arm stretched out away from the body of the city. Beginning in May, when new council district boundaries take effect, the district, by a wide margin, will be the most brown and black and the least white district in the city. Its 53,000 residents are 46 percent latino, 28 percent black and 18 percent white, according to census figures. It is home to the second-largest percent latino district population in Denver; the largest percent black population; and the lowest white population. It’s also economically mixed, a place where home prices range from $150,000 to $600,000 and average in the mid- $200,000s.

“We have business executives and doctors and we have police and firemen out here,” says Schroeer-Santiago.

The way drilling is approaching Denver fits a pattern in Colorado, where oil and gas companies move into Front Range towns in stages, closing in first from high-plains grasslands, then from farm fields, then from strip-mall suburbs.

Given even Colorado’s current statewide setback rules for drilling — 500 feet from homes — few fear a swarm of fracking towers will rise soon in the neighborhoods of inner Denver. But, as Reverend Nelson Brock, a member of the new anti-fracking coalition puts it, what happens to degrade the environment, health, property values in any part of Denver concerns the whole city.

“This is about responsibility,” he told The Independent. “We’re part of an urban ecosystem. We’re told fracking is safe — at least until it’s not. There is research coming out in waves now and it is turning the conversation… Emissions from the traffic and the wells is serious. The wastewater is damaging land. Fracking activity causes earthquakes. This isn’t speculation. And District 11 is on the frontline. It is our responsibility to speak out for communities that alone lack power, that are more vulnerable. The emissions won’t stay in Green Valley Ranch.”

Monica Acosta, an organizer with Denver education activist group Padres y Jovenes, says she is not surprised District 11 is the first to see drillers encroach. “This is why we talk about environmental justice or environmental racism,” she said. “There’s a strong correlation in Colorado, as elsewhere, where higher numbers of wells match higher populations of working class and ethnic populations, communities of color — people who have less time and money to be politically active and push back.”

‘Our Burgeoning Energy Sector’

In advance of today’s “Don’t Frack Denver” coalition announcement, Mayor Hancock’s spokesperson Amber Miller suggested the mayor, like political leaders across the state, is watching what will happen at the state Capitol in the coming weeks. Lawmakers are preparing to receive recommendations from the state Oil and Gas Task Force formed by Governor Hickenlooper last summer to cool tensions that pitted Front Range residents and politicians seeking greater local regulatory control against oil and gas supporters and state officials who maintain the industry is already well-enough regulated.

“Mayor Hancock supports the governor’s call for municipalities to engage in the work of the Oil and Gas Task Force, which he anticipates will develop responsible recommendations for the entire state that will allow our burgeoning energy sector to succeed while maintaining the integrity of our environment and quality of life,” Miller wrote in an email.

It was the kind of response members of the coalition expect and the kind they’re hoping to push beyond.

“Rather than following the governor’s illegitimate oil and gas task force, we hope the mayor will lead,” said Sam Schabacker, director of nonprofit Food and Water Watch. “We call upon him to protect Denver’s residents, health and water by placing a moratorium on fracking in Denver and keeping fracking out of our watershed.”

The state task force already has floated recommendations that include granting communities greater say over drilling through zoning rules, requirements that drilling companies submit master plans of operations for neighborhood authorities to review and the establishment of a new panel that would moderate conflicts between drillers and locals.

In Green Valley Ranch, Schroeer-Santiago says she thinks the main target should be ignorance or misinformation about the process by which drilling goes from an abstract topic on the television to a reality unfolding in your backyard.

“Some people here are still not clued in, I think,” she said. “They say, ‘Look there’s no permits for drilling yet in our neighborhood.’ But they don’t know that the permits come at the end of the process. They don’t know who is applying for the permits, who owns the rights or how to find out this stuff. Once a company applies for a permit, it’s a done deal — the lease has already been done and the permits will get approved and then they start fracking.”

[Photo by Erie Rising]