When Senate Bill 19-181 was first introduced on March 1, there was a lot of fear about how the legislation could cause the oil and gas industry to abandon Colorado, taking tens of thousands of lucrative jobs with it.

But by the time it was passed on April 11, the bill had taken a new form. Earlier this week, Speaker of Colorado’s House of Representatives KC Becker, D-Boulder, Colorado Senate Assistant Minority Leader John Cooke, R-Greeley, and Colorado Oil & Gas Association President Dan Haley talked about how a couple of words and a handful of amendments turned a feared job killer into a bill both sides could accept.

Although amendments had been proposed and voted on throughout the bill’s journey to Gov. Jared Polis’ desk, Cooke said the meat of the negotiations between bill sponsors and industry leaders didn’t come until late March when the bill was being considered by the Colorado House.

“Leaders from both the House and Senate, and from both sides of the aisle came together to talk with industry about some concerns they had with the bill and some amendments they needed to continue to operate in Colorado,” Cooke said. “It came down to changing the language on some things to create a little bit of surety and stability for the industry moving forward.”

Despite being involved in those negotiations and voting in favor of the amendments, Cooke and every Senate Republican voted against SB-181.

One of the key language changes was the addition of the words “necessary and reasonable.” Although seemingly inconsequential to the casual observer, Haley said the addition of “necessary and reasonable” to various parts of the 29-page bill were instrumental in protecting the oil and gas industry from arbitrary rules and providing some sense of stability for the industry’s future in Colorado.

“As introduced, the bill would have permitted any regulation – no matter how subjective or unreasonable,” Haley said in an email to The Tribune. “Companies cannot operate in that setting. That’s why it was important to have words like ‘necessary and reasonable’ added in key parts of the bill.

“Every regulatory framework, regardless of industry, has some sort of ‘technical feasibility’ or ‘cost-effectiveness’ or ‘reasonableness’ language purposefully written into the basic construct of government oversight to provide a sense of certainty around the application of the regulations themselves.”

Similarly, Becker, one of the bill’s prime sponsors, said the oil and gas industry had concerns about the bill’s main objective: to provide local governments with more control over land use decisions. As introduced, the bill read as though a local government would be able impose its agenda on neighboring municipalities and counties, and not only regulate potential impacts at the surface, but also dictate how operators conduct oil and natural gas exploration operations below the surface.

Becker said that language was cleaned up to limit a local government’s authority to the surface and within the confines of its own jurisdictional boundaries.

Another notable amendment dealt with what Becker called the professionalization of the Colorado Oil & Gas Conservation Commission. Under the new law, the agency’s board of commissioners, which serve an advisory role, would be paid, full-time employees of the state rather than volunteers.

The board would be reduced to five members from seven and its members would be required to have an expertise in oil and gas operations, land use, public health or conservation, to name a few. The goal, Becker said, is to transition the COGCC to an agency that regulates the oil and gas industry, rather than promote it.

Also important to the oil and gas industry was some assurance oil and gas activity would remain steady while the COGCC director drafts new rules. Under the new law, the COGCC must draft new rules about proper wellbore integrity and how flowline information can be disclosed to the public, as well as new guidelines for inspecting inactive, temporarily abandoned or shut-in wells before being put back into production or used for injection.

Under the original version of the bill, the COGCC director could delay approving drilling permits until the new rules were written. Opponents of the bill said any delay would essentially be a de facto moratorium on oil and gas activity, especially considering the COGCC already has a backlog of about 6,500 drilling permits waiting to be reviewed.

Thanks to an amendment, the COGCC director must publish specific criteria about how the department is going to review those pending drilling permits, including an order in which they will be reviewed, while those new rules are being written.

“I think we were successful in giving local government more of a role in the process and changing the mission of the COGCC from promoting the oil and gas industry to regulating it,” Becker said. “In the end, I think the changes we made were reasonable.”

Despite receiving many of the assurances the industry was after, Haley said he and oil and gas operators still view the new law with some trepidation.

“The final version of the bill, as signed into law, provides a degree of certainty for our industry. We could not make that statement as the bill was originally introduced,” Haley said in an email to The Tribune. “But let’s be clear, SB-181 was not meant to be a stimulative bill for our industry and we don’t yet know all of the unintended – and intended – negative consequences of the legislation.”

– Joe Moylan covers crime and public safety for The Greeley Tribune. Reach him at jmoylan@greeleytribune.com, (970) 392-4467 or on Twitter @JoeMoylan.