Colorado - OXY and Noble Energy favor increased Local Control
Colorado
Representatives from Occidental (OXY) and Noble (NBL) told the Colorado Oil and Gas Conservation Commission (COGCC) in August that they are in favor of increased regulatory control at the municipal and county level as the commission began six weeks of rule-making hearings for Senate Bill 19-181 (SB 19-181). This is a change in posi- tion from operators historically arguing that a jumble of local regulations would be difficult to navigate and could
create unnecessary approval hurdles. Sponsors of SB 19-181 have stated that state regulations will be the base level and local restrictions would apply only if they are more severe. A zoom meeting for a vote by the COGCC on the rules and final rulemaking was scheduled for November 23, 2020.
Legislative
Update
Wyoming Oil and Gas Legislative Update: HB14
Wyoming
June 17, 2020 —Wyoming’s oil and gas regulations were recently amended in an effort to attract energy development in the state. Among the new laws is House Bill 14, which changes the way operators force pool nonconsenting owners. The Wyoming Oil and Gas Conservation Commission has authority to issue pooling orders to pool interests located within a drilling and spacing unit (“DSU”). WYO. STAT. § 30-5-109 currently provides that when two or more separately owned tracts of land are embraced in a DSU, and in the absence of voluntary pooling, any interested party may enter an order pooling all interests in the DSU. Nonconsenting working interest owners and nonconsenting unleased mineral owners are chargeable with their proportionate share of costs for (i) newly acquired surface equipment (e.g., stock tanks, separators, treaters, pumping equipment and piping) and (ii) drilling and operating the well commencing with first production. Such nonconsenting parties were also subject to a risk penalty of (i) up to 300% of the costs of drilling, reworking, deepening, plugging back, testing and completing and (ii) up to 200% of that portion of the
cost of newly acquired equipment. Beginning on July 1, 2020, House Bill 14 significantly amends WYO. STAT. § 30-5-109. Under the new compulsory pooling statute, an applicant-operator is given twelve months from the date an order is issued to commence operations. As in the previous version, the operator is entitled to recover its proportionate share of costs for equipment, drilling and operating from each carried nonconsenting owner. For lessees, the risk penalty remains (i) up to 300% of the costs of drilling, reworking, deepening, plugging back, testing and completing and (ii) up to 200% of that portion of the cost of newly acquired equipment. With regard to unleased nonconsenting mineral owners, the risk penalty will now be (i) up to 200% for drilling and operating costs and up to 125% for newly acquired equipment for the first well, and (ii) up to 150% for drilling and operating costs and up to 125% for newly acquired equipment for each subsequent well.
During the time the operator is receiving the risk penalty from the unleased mineral owners, the mineral owners can
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G r o w t h T h r o u g h E d u c a t i o n - O c t o b e r / N o v e m b e r / D e c e m b e r 2 0 2 0
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