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COGA Statement on Resuming COGCC Penalty Rulemaking

Monday, January 5, 2015

Colorado Oil & Gas Association Statement on Colorado Oil and Gas Conservation Commission resuming its hearing on strengthening fines and penalties on oil and gas industry

Denver, CO - January 5, 2015 -- Colorado Oil and Gas Conservation Commission (COGGC) will resume its deliberations on Monday January 5, 2015, to implement House Bill 14-1356, which increases fines and penalties on oil and gas companies who were out of compliance with the Colorado’s comprehensive oil and gas rules and regulations.

After two days of hearings on December 15th and 16th, 2014, the COGCC decided to delay its final decision on the how to best implement the new rule.  However, contrary to some media reports, the COGCC did not delay its decision on Dec 16th because of “intense oil and gas industry pushback” but according to the COGCC itself, they simply ran out of time.

“The Commissioners delayed the decision for no other reason than it was after 5 p.m. and they had several versions of proposed rules they needed to compare and individually review,” said Tisha Schuller, Colorado Oil & Gas Association President and CEO.

“COGA, and each industry representative that testified last week, made it clear that we supported the law that passed and the COGCC’s authority to implement its mandates.  The industry was proud to support the increased penalty bill,” Schuller emphasized.

Industry pointed out concerns over the process of issuing Notices of Alleged Violations, or NOAVs, and the penalty schedule set forth in the COGCC’s proposed penalty matrix – none of which HB 1356 addressed in any detail.  “There is one small portion of the rules, however, that we believe should be addressed as the COGCC determines how best to implement the law,” added Schuller.

Schuller noted that industry is concerned the misapplication of the penalties would have an impact on companies if applied without reasonable discretion to the alleged violation.  “We’re looking for clarity and certainty as to how the new rules would be enforced and applied, not for certainty on what the penalty should be.” Schuller said. “Overall, we are all on the same page with the same goal, which is to promulgate rules that provide certainty, clarity, and consistency to all stakeholders, not just industry.”

“As noted in COGA’s opening statement at the hearing, industry is held to the highest standard in Colorado,” concluded Schuller.  “I expect that the COGCC will once again lead the nation by enhancing Colorado's strong rules in a way that protects stakeholders while supporting a predictable business environment.”

Doug Flanders

Dan Haley
720-420-4255 – office
303-941-6440 – mobile

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