Colorado Springs News, Sports & Business

Hickenlooper aide gives assurance on drilling deal

Associated Press Updated: August 12, 2014 at 12:03 pm

GLENWOOD SPRINGS — Gov. John Hickenlooper does not want local governments in western Colorado to lose future revenue from energy development because of a proposal to settle lawsuits over drilling on the Roan Plateau, an official said.

State planning and budgeting director Henry Sobanet made the assurances in a letter to state Rep. Bob Rankin, R- Carbondale, the Glenwood Springs Post Independent reported Tuesday (http://tinyurl.com/m759kgr).

Under the settlement, Bill Barrett Corp. would give up some federal oil and gas leases in pristine areas atop the vast plateau northwest of Rifle. In exchange, Barrett would be reimbursed about $28 million, and Barrett and others would also be allowed to drill for natural gas in less controversial areas, some at the base of the plateau near existing wells.

The deal could end several years of litigation over drilling on the plateau.

Rankin has been working with Hickenlooper to keep the state from withholding future federal lease payments to local governments in order to refund the $28 million to Barrett.

The payments are supposed to help local governments affected by the drilling to deal with the impacts. The state currently passes on 40 percent of the federal lease payments to local governments after the Legislature decided to take some of the money to help balance the state budget during the recession.

Rankin said withholding more of the federal lease money would be a "double hit" to local communities.

Sobanet said the Hickenlooper administration agrees.

"We do not believe a 'double hit' to these revenue streams would be appropriate policy," he wrote.

Rankin said taking the $28 million for Barrett from the general fund or another place will require a change in the law. He plans to sponsor a bill to do that in the next session of the Legislature, in 2015.

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Information from: Post Independent, http://www.postindependent.com/

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