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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 02/19/2013 - ITEMS RELATING TO A BAN OF HYDRAULIC FRACTURING ANDATE: February 19, 2013 STAFF: Laurie Kadrich, Dan Weinheimer, Wanda Nelson AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 26 SUBJECT Items Relating to a Ban of Hydraulic Fracturing and Certain Storage of Waste within the City. A. First Reading Ordinance No. 032, 2013 Amendment to the City Code Which Would Impose a Ban on Hydraulic Fracturing and Certain Storage of Waste within the City (Operator Agreement in place). OR Resolution 2013-011 Submitting to the Registered Electors of the City a Proposed Amendment to the City Code Which Would Impose a Ban on Hydraulic Fracturing and Certain Storage of Waste Within the City (Operator Agreement in place). AND B. Resolution 2013-012 Requesting Statutory Power to Regulate Oil and Gas Exploration and Production, Supporting the City of Longmont in its Litigation with the State of Colorado Concerning the Regulation of Oil and Gas Exploration and Production and Authorizing Negotiations with Larimer County Regarding Oil and Gas Regulations in the City’s Growth Management Area. Staff also requests Council direction regarding which option(s) to prepare for future Council consideration regarding City-owned lands outside the city limits. EXECUTIVE SUMMARY On February 5, 2013, City Council directed staff to prepare City Code changes prohibiting the use of hydraulic fracturing, and limiting the open pit storage of waste or flowback created in connection with the fracturing process in the city limits. Those changes are reflected in the proposed Ordinance No. 032, 2013. If no action is taken on Ordinance No. 32, 2013, staff prepared an optional resolution for Council to consider: • Resolution 2013-011 Submitting to the Registered Electors of the City a Proposed Amendment to the City Code Which Would Impose a Ban on Hydraulic Fracturing and Certain Storage of Waste With the City (Operator Agreement in place). In addition to the options presented banning hydraulic fracturing, staff developed Resolution 2013-012: • requesting the Governor and Attorney General support the Colorado General Assembly in enacting legislation that will explicitly grant power for home rule cities in the State of Colorado to regulate oil and gas exploration and production within municipal boundaries • supporting the City of Longmont in its litigation with the State of Colorado concerning the power of home rule cities to regulate the exploration for and production of oil and gas development • directing negotiation with the Board of Commissioners of Larimer County for the establishment of County regulations on oil and gas exploration outside the City, but within the Fort Collins Growth Management Area. BACKGROUND / DISCUSSION In December 2012, City Council authorized a moratorium preventing any further drilling of oil and gas wells in the city limits or on City-owned lands until July 31, 2013. Since that time, citizens asked the Council to consider banning hydraulic fracturing in the city. During the January 22, 2013 Work Session, Council discussed the pros and cons related to banning hydraulic fracturing (Attachment 10). Following this discussion staff was directed to prepare a Resolution banning hydraulic fracturing and storage of related waste materials for the February 19, 2013 regular Council meeting. February 19, 2013 -2- ITEM 26 Council also asked that the staff report include more information on local geology, scientific data relative to hydraulic fracturing, the likelihood of local earthquakes due to fracturing, and the financial impacts of a ban or an adverse incident if hydraulic fracturing were not banned. Staff was further directed to pursue an operator agreement with Prospect Energy seeking compliance with the strictest measures proposed for Land Use Code adoption prior to the implementation of a moratorium. During a Council meeting on February 5, 2013, staff was asked to prepare an Ordinance banning hydraulic fracturing and open pit storage except on existing well or operating pad sites, or if the pad site becomes the subject of an operator agreement with the City. Council also asked staff to develop options for regulating or banning hydraulic fracturing on City-owned lands outside the city limits. On February 11, 2013, the Colorado Oil and Gas Commission (COGCC) adopted rule changes moving setbacks from well pads to 500 feet in most areas and 1000 feet from buildings that house larger numbers of people. This change reduces the area that may be subject to oil and gas development to 11% inside the City limits. Geology Staff was asked to review the geology beneath Fort Collins and adjacent lands to determine what potential oil and gas resources may exist. Staff reviewed information provided by geologists at Colorado State University (CSU), the Colorado State Geologist, and the United States Geological Survey (USGS). Most of the academic and professional mapping and articles available on the North Front Range focus on the Greater Wattenberg Area (GWA); very few mention Fort Collins or the Fort Collins Field by name. Geologists cite the lack of information as an indication of a low probability of oil and gas production within the community. In 2009, the Natural Areas Department, as part of the Energy by Design project, developed a map depicting potential oil and gas development (Attachment 8). Mapping of oil and gas development potential indicates that the most likely production area is expected in the northern part of Fort Collins, where the present field exists (Attachment 9). Recent activity in Northern Colorado has focused on the Niobrara formation ; in Fort Collins, the Niobrara development potential is estimated as “moderate” (Attachments 8 or 9). Potential Fort Collins Oil and Gas Activity To determine oil and gas potential, staff reviewed the historic record of drilling in Fort Collins, the current operations, and the regional geological information. • The historic record indicates that the Muddy “J” has been the only productive formation in Fort Collins. Niobrara development has been the focus of the recent activity in the Greater Wattenberg Area. • Prospect Energy indicates that current operations have targeted the Niobrara formation but those efforts have not proved economical. • The geologic record indicates that the Niobrara is located near the surface in Fort Collins and the Niobrara is not deep enough to yield quality gas or oil. Fort Collins The wells drilled within the Fort Collins Field were drilled with several target formations in mind. Initially, wells drilled in 1925 sought to reach the Hygiene (Pierre Shale) or the Muddy “J” sandstone. This is consistent with the discovery in 1923 of oil from the Muddy “J” in the Wellington Field to the north of Fort Collins. The Wellington Field was the first set of wells producing from the Muddy “J” in the Denver Basin. Muddy “J” sandstone near Fort Collins exists at a depth of approximately 4,500 feet with an average thickness of 25 feet. Going east from Fort Collins, there is greater depth beginning along Interstate 25. The shallow portions of the rock to the west of the City are not likely to have marketable oil and gas supplies. Prospect Energy’s operations in the Fort Collins Field are in the Muddy “J” formation. The company tested the Niobrara in the Fort Collins Field but has not yet found a well that would be profitable. These results reflect the historical development of oil and gas in Fort Collins where operators attempted to produce oil and gas from the Lyons, Lakota, Dakota, Codell, Niobrara and the Hygiene formations. A detailed review of Colorado Oil and Gas Conservation Commission (COGCC) records indicates the Muddy “J” is the only formation that has ever profitably produced within Fort Collins. As hydraulic fracturing and drilling technology advance it remains possible that other formations lying beneath Fort Collins might produce oil and gas. For a more detailed analysis, see Attachment 1. February 19, 2013 -3- ITEM 26 ENVIRONMENTAL IMPACTS Air Quality Several current studies pertinent to the Front Range or Rocky Mountain region were reviewed to support the following conclusions (citations are provided in Attachment 2): • Measurable emissions of several pollutants attributable to drilling, construction, material storage and treatment, production, and transmission activities from oil and gas operations have been detected, including the following: N Nitrogen oxides (NOx) and volatile organic compounds (VOCs) which are ozone precursors N Hazardous Air Pollutants (HAPS) including several carcinogens (primarily benzene and formaldehyde) and other air toxics associated with chronic and sub-chronic health effects (respiratory and neurologic disease and head, throat, and eye irritation) N Particulate matter including dust and aerosols N Odors (hydrogen sulfide and odiferous hydrocarbons) N Nitrogen and sulfur compounds that contribute to visibility impairment (haze) and atmospheric deposition (acid rain) N Methane, a potent greenhouse gas and ozone precursor. • Oil and gas development activities can emit raw (non-combusted) natural gas which has a unique signature that can be differentiated from motor vehicle emissions and other industrial or combustion sources. Elevated levels of volatile organic compounds associated with natural gas operations (drilling and venting) were found in the Front Range area. • Hydrocarbons emitted from oil and gas activities along the Front Range (primarily propane and other alkanes) comprise some of the highly reactive precursors important in the complex atmospheric chemistry responsible for winter ozone formation. Winter ozone formation is a recently discovered phenomenon that has clearly been attributed to emissions from oil and gas development and production activities in the Green River Basin (Wyoming) and Uintah Basin (Utah). • Associated impacts to human health including excess cancer risk and chronic non-cancer health impacts have been measured at locations within 0.5 miles of active well pad sites. Additional studies, many of which are currently ongoing, will help to define the potential risk to human health, effectiveness of air emission control strategies, and potential impacts to air quality from oil and gas development activities. Water Quality Environmental and Health Concerns • While there is no scientific consensus and studies are few, there is some indication of a potential link between high-pressure underground injection (i.e., underground injection wells for wastewater) and gas migration near the well (movement of methane into groundwater.) The associated risk to humans is that methane that is found in drinking water sources could potentially build up in confined spaces and cause explosions. Methane gas is not considered toxic if consumed in drinking water and is not regulated by the Environmental Protection Agency (EPA) under the Safe Water Drinking Act (SWDA). N A USGS study by Ellsworth near wastewater wells (Class II Underground Injection Control (UIC) wells) in Menlo Park, CA suggests the high pressure injection might make well cement cracks more likely. Findings by other researchers suggest a similar finding, but conclude further research is needed. Although this may have implications for high pressure injection techniques used in hydraulic fracturing, there is no scientific consensus on the probability of its occurrence or the mechanisms involved. Local wells classified as UICs are actually injecting at sub-fracturing pressures; see more below under earthquakes. • Most shallow water contamination resulting from hydraulic fracturing and conventional oil and gas production has been linked to surface activities resulting in releases of wastewater due to accidents, poor management of wastewater storage and disposal, and illicit dumping. • Most aquifer contamination (i.e., potential drinking water resources) from conventional oil and gas production has been linked to well casing failures. There is not enough research for hydraulic fracturing operations to show a similar link. In response to public concern and industry growth, the US House of Representatives requested in 2009 that the US EPA conduct scientific research to examine the relationship between hydraulic fracturing and drinking water resources. The project planning phase involved agency consultation with other federal agencies, state and interstate regulatory agencies, industry, non-governmental organizations, and others in the private and public sector to determine the focus of the study regarding potential impacts on human health and the environment. The primary research focused on February 19, 2013 -4- ITEM 26 investigating impacts to drinking water resources. The first progress report on the results of this research was published by the EPA, December 2012, Study of the Potential Impacts of Hydraulic Fracturing on Drinking Water Resources, Progress Report, EPA 601/R-12/011, Office of Research and Development. The research consists of 18 research projects and is organized around five stages of the hydraulic fracturing water cycle: 1. Water acquisition: What are the possible impacts of large volume water withdrawals from ground and surface waters on water resources? 2. Chemical mixing: What are the possible impacts of hydraulic fracturing fluid surface spills on or near well pads on water resources? 3. Well injection: What are the possible impacts of the injection and fracturing process on water resources? 4. Flowback and produced water: What are the possible impacts of both types of wastewater surface spills on or near well pads on water resources? 5. Wastewater treatment and waste disposal: What are the possible impacts of inadequate treatment of hydraulic fracturing wastewater on water resources? The results from the study, which are not expected until 2014, are intended to inform the public and provide policymakers at all levels with high-quality scientific knowledge that can be used in decision-making. The research involves collection and analysis of existing data from 24,925 wells that have been hydraulically fractured, complex modeling conducted by the Lawrence Berkeley National Laboratory, toxicity assessments of 1,858 chemicals associated with hydraulic fracturing, and case studies. The EPA also manages the two most comprehensive databases on toxicological data that are used for risk assessments nationally and internationally. The literature reviews for this study are subject to a separate quality review that assesses the soundness, applicability and utility, clarity and completeness, uncertainty and variability, and evaluation and review of the data and information before inclusion in the research. Attachment 3 includes references accepted for inclusion in the EPA report that are organized by research topic related to water quality. This list is a subset of references reviewed to date that cover the most relevant research topics being investigated; for a complete list refer to the 2012 EPA report cited above. The EPA has compiled and continues to search for literature relevant to the research questions posed in this report including a recent Federal Register notice requesting peer-reviewed data and publications relevant to this study. There has not been any preliminary data released from this effort. Waste and Wastewater Environmental Concerns • Hydraulic fracturing produces higher volumes of wastewater that surface as flowback in a shorter period of time than conventional drilling techniques. This creates more challenges for capture, storage, and disposal of wastewater and associated emissions than for conventional drilling operations (e.g., more VOC emissions if not captured adequately, more potential for accidental spills). • Wastewater management and disposal may be the single most important issue associated with environmental and human health protection. The Bureau of Land Management has proposed new requirements for submission of wastewater management plans prior to drilling. Deep injections of wastes in Class II UIC wells, not fracturing operations, have been linked to earthquakes to date. Earthquake Potential in Fort Collins Water disposal in the oil field involves injecting waste water into a deep disposal well. This process usually increases pressure in the rock above the native state (pre-water disposal) of the rock. Usually there is not any fluid removed from the rock, only fluid (wastewater) added, thereby increasing reservoir pressure. Many other industries and the Federal government also use water disposal wells. There have been noted cases of water disposal wells causing seismic activity. National Academies of Science concluded a study in 2012 and listed three major findings: 1. “the process of hydraulic fracturing a well as presently implemented for shale gas recovery does not pose a high risk for inducing felt seismic events;” 2. “injection for disposal of wastewater derived from energy technologies into the subsurface does pose some risk for induced seismicity, but very few events have been documented over the past several decades relative to the large number of disposal wells in operation”; and 3. “Carbon Capture and Storage (CCS) due to the large net volumes of injected fluids, may have potential for inducing larger seismic.” February 19, 2013 -5- ITEM 26 The factor that appears to have the most direct consequence in regard to induced seismicity is the net fluid balance. The Bureau of Reclamation stated it has not done any independent studies regarding hydraulic fracturing or deep injection wells. However, it did state that the work done between 1999 and 2004 on all the Horsetooth Dams was performed as mitigation for major seismicity that it defines as much greater than what research reveals is a risk due to deep injection wells. Locally, a process called waterflooding is used and, in general, operators are required to maintain pressures that are below fracture gradient and even further lower, based on the last mechanical integrity test, according to COGCC regulations. In other words, at the Fort Collins Field waterflooding (recycled water), the Muddy formation maintains pressures near or slightly below original reservoir pressures. Waterflooding started in the Fort Collins Field as a smaller pilot test in September 1979 after obtaining COGCC approval. Upon success of the pilot, COGCC approved expansion and the expanded project started in July 1985. According to the current operator, “We’ve been injecting water for a long time at fairly steady rates without any recorded seismic events.” Habitat Fragmentation Resulting From Oil and Gas Development Several current studies pertinent to the Front Range or Rocky Mountain region were briefly reviewed to support the following conclusions (For further information and citations see Attachment 4): • Wildlife impacts and habitat fragmentation from oil and gas activities have been documented, largely for the Greater Yellowstone and Western Wyoming regions. Species studied include mule deer, pronghorn, and greater sage-grouse. The studies largely focused on how migration patterns and winter habitat use could be or have been affected by oil and gas development. N Mule deer migration patterns changed in the initial year of oil and gas development. Migration patterns did not appear to acclimate three years after well establishment. Instead, mule deer migration patterns continued to drift further from the well pad development areas. High value habitat areas prior to the study shifted to low habitat values throughout the study. N A further study found that mule deer abundance for the herds in the same area had declined by 23% during 2001-2010, where the oil and gas development had expanded. N One recent study has also examined the impact of oil and gas development on sagebrush-dependent songbirds (Gilbert and Chalfoun 2012). Some species, which are generally more tolerant to disturbance, such as the Horned lark (Eremophila alpestris) did not respond to increases in well densities. However other species, such as the Brewer’s sparrow (Spizella breweri) and sage sparrow (Amphispiza belli) which are dependent on sagebrush communities, had significant population decreases as oil and gas well density increased, suggesting there may be significant impacts to sagebrush-obligate species. A comprehensive synthesis of oil and gas impacts was recently compiled by The Wildlife Society in 2012. In addition to the issues addressed above, the report also identifies increased noxious weed invasions, impacts to waterfowl from wetland impacts, and the potential for increased competition between deer and elk as highly valued habitat is used for oil and gas development. The report also highlights that the cumulative effects of habitat fragmentation, overall loss, and degradation may prove to have the most impact on wildlife. • Horizontal drilling may reduce the overall impacts of habitat fragmentation, as multiple areas of land can be accessed from a single well pad. However, it is difficult to know the extent of this reduction without further study. • Based on the studies available, habitat fragmentation effects from oil and gas development appear to be better understood at the landscape level, e.g., how oil and gas development affects pronghorn and mule deer migration patterns. Thus, the findings from these studies may be best applied at the regional scale, e.g., Larimer County and the Rocky Mountain Foothills. • Staff did not find any research that compared the habitat fragmentation effects of oil and gas development in rural or open undeveloped lands with those in more traditional urban development. FINANCIAL AND SOCIAL IMPACTS A true triple bottom line analysis includes an assessment of environmental, social, and economic impacts. Staff analysis to date has focused on potential and possible environmental impacts if hydraulic fracturing is allowed. Staff however, was unable to conclusively determine financial impacts of any health and safety hazard related to hydraulic fracturing due to the significant number of variables that relate to the hydraulic fracturing process, transportation of material and waste produced, and removal of waste materials. A social impact analysis has not yet been undertaken February 19, 2013 -6- ITEM 26 for this discussion. It is assumed that social impacts of hydraulic fracturing are discussed and addressed in terms of concerns about health impacts, impacts to property and housing values, and quality of life. Should hydraulic fracturing be banned, the City would likely need to prepare for the costs associated with a lawsuit since similar ballot measures have resulted in lawsuits being filed. The City of Longmont is being sued by the State of Colorado for its regulation of drilling, and by the industry (Colorado Oil and Gas Association (COGA)) for its citizen- approved ban on hydraulic fracturing. If the City bans hydraulic fracturing, this action would prohibit any use of this treatment in the Fort Collins Field. Whether the local operator, Prospect Energy, would be able to present a claim for damages is unknown. There are other fracturing technologies that have seen limited use and for which there may be limited equipment available for field use (See Attachment 5). There could be a loss of local revenues generated from oil and gas development within the city limits. Revenues for the last two years average $215,460 annually. This revenue is based on state formulas that include well sites, jobs, roads and other measures to determine the revenues sent to individual communities. It is difficult to estimate what impact the loss of future wells or reduced production would have on this amount received by the City. STATUS OF OPERATOR AGREEMENT Prospect Energy and City staff have discussed possible terms of an agreement but no formal option is ready for Council review at this time. OPTIONS FOR RESTRICTING HYDRAULIC FRACTURING ON CITY-OWNED LANDS OUTSIDE THE CITY LIMITS 1. Include restrictions on City-owned lands outside of the city limits in the ban on hydraulic fracturing. 2. Include these restrictions in any Land Use Code requirements following the moratorium. 3. Extend the moratorium on City-owned lands and apply for Designated Outside Activity Areas status through the COGCC. 4. Utilize the Energy by Design Process for mineral rights owned by the State Land Board (SLB) and extend those requirements to other mineral owners through the adoption of surface use agreements. 5. Utilize the Energy by Design Process for mineral rights owned by the SLB and develop surface use agreements for other mineral interests that reflect best practice or meet the Land Use Code during the time the mineral right is extracted rather than committing to the Energy by Design process at this time. Natural Areas staff was consulted about the potential for a hydraulic fracturing or drilling ban on lands owned by the City that are outside the city limits, including Soapstone Prairie Natural Area and other natural areas. Natural Areas staff recommends against a ban. The recommendation is based on a variety of factors, but in particular relates to Soapstone and Meadow Springs Ranch (a Utilities property) for the following reasons: Staff learned that, in the absence of horizontal hydraulic fracturing, there is a some likelihood that smaller companies will lease minerals and drill vertically. Vertical wellheads could be placed on the ground at densities of one well per 20 to 35 acres. That density of activity would be very destructive to the surface of Soapstone and Meadow Springs. Hydraulic fracturing densities potentially could be kept to perhaps one five to ten acre well pad (with multiple wellheads) per section (640 acres), or perhaps even less. This would be far better for the natural, cultural, and scenic resources the City is trying to protect. The City Council approved a Memorandum of Understanding with the State Land Board (SLB) regarding a cooperative effort to undertake an Energy by Design (EBD) process The attached memo (Attachment 7) describes that effort. The final EBD report was presented to the public in September, and is to be reviewed by the SLB commissioners this month. The SLB took an unprecedented and major step forward by engaging in the EBD process, partly in response to the strong urging of the City of Fort Collins. Implementation of Energy by Design would place strict limits on mining activities, far stricter than any regulation or practice that staff is aware of in the State of Colorado in a similar environment. Staff is concerned about the implications of an effort by the City to ban drilling or hydraulic fracturing on these lands and the negative impact that would have on the collaborative relationship the City has built with the SLB, as well as on the Energy by Design approach that has been developed and is being reviewed. It is difficult to predict how the SLB would approach leasing of minerals on the City’s property in this event, but the collaborative approach developed February 19, 2013 -7- ITEM 26 through the EBD process would be put in jeopardy. Under the terms outlined in the EBD, mineral owners and /or lessees will be required to enter into an Operator Agreement or Surface Use Agreement with the City prior to any surface disturbance associated with exploration or production. This agreement will contain requirements much stricter than current State regulations and will implement the avoidance and mitigation strategies outlined in Energy by Design. The State Land Board is a partner in the planning process and will recognize and support the use of EBD. Further, Council approval is required for the City to enter into the Operator Agreement or Surface Use Agreement. In summary, Natural Areas negotiated with the SLB to create a potentially much better on-the-ground situation. Further, Natural Areas believes that patient planning, negotiations, and the use of multiple strategies will obtain the best possible long-term results. While there are substantial risks associated with this approach, staff believes they are far less than those posed by a hydraulic fracturing or drilling ban. STAFF RECOMMENDATION Staff recommends the following actions: • Adoption of Ordinance No. 032, 2013, on First Reading and Resolution 2013-012, as opposed to placing the question on the ballot. • Limit restrictions to lands within the city’s boundary and not include restrictions on City-owned lands outside the city boundaries • Direct staff to continue developing Code language regulating oil and gas exploration to the greatest extent of its home rule authority • Direct staff to prepare an operator agreement for Council consideration with Prospect Energy. BOARD / COMMISSION RECOMMENDATION There has not been any additional board or commission review since the moratorium was authorized in December 2012. PUBLIC OUTREACH There has not been any additional public outreach specific to the Ordinance and Resolutions proposed. ATTACHMENTS 1. Geology Memorandum, Dan Weinheimer, City of Fort Collins Policy and Project Manager 2. Air Quality Memorandum, Melissa Hovey, City Senior Environmental Planner 3. Water Quality Memorandum, Bonnie Pierce, City Environmental Data Analyst 4. Habitat Fragmentation Memorandum, Lindsay Ex City Environmental Planner 5. Options to Hydraulic Fracturing, Bonnie Pierce, City Environmental Data Analyst 6. Natural Areas Memorandum of Understanding 7. Natural Areas Memorandum, John Stokes, City Natural Areas Director 8. Map Oil and Gas Potential 9. Map (detailed Fort Collins) Oil and Gas Potential 10. January 22, 2013 Work Session Summary 11. Powerpoint presentation City Manager’s Office PO Box 580 300 LaPorte Ave. Fort Collins, CO 80522 970.221.6505 970.224.6107 - fax fcgov.com MEMORANDUM Date: February 6, 2013 To: Mayor Weitkunat and City Councilmembers From: Laurie Kadrich, Director, Community Development and Neighborhood Services Dan Weinheimer, Policy and Project Manager Through: Darin Atteberry, City Manager Wendy Williams, Assistant City Manager Re: Submitting to the Registered Electors of the City a Proposed Amendment to the Code of the City of Fort Collins Which Would Impose a Ban on Hydraulic Fracturing and Certain Storage of Waste Within the City Staff was asked to review the geology beneath Fort Collins and adjacent lands to determine what potential oil and gas resources may exist. Staff reviewed information provided by geologists at Colorado State University (CSU), the Colorado State Geologist, and the United States Geological Survey (USGS). Most of the academic and professional mapping and articles available on the North Front Range focus on the Greater Wattenberg Area (GWA) and very few mention Fort Collins or the Fort Collins Field by name. Geologists cite the lack of information as an indication of a low probability of oil and gas production within the community. The mapping indicates that the most likely production area is expected in the northeast of Fort Collins, where the present field exists. Recent activity in Northern Colorado has focused on the Niobrara formation and in Fort Collins the Niobrara development potential is estimated as “moderate”.i Potential Fort Collins Oil and Gas Activity To determine oil and gas potential staff reviewed the historic record of drilling in Fort Collins, the current operations and the regional geological information.  The historic record indicates that the Muddy “J” has been the only productive formation in Fort Collins. Niobrara development has been the focus of the recent activity in the Greater Wattenberg Area. ATTACHMENT 1  Prospect Energy has indicated that current operations have targeted the Niobrara formation but those efforts have not proved economical.  The geologic record indicates that the Niobrara is located near the surface in Fort Collins and the Niobrara is not deep enough to yield quality gas or oil. Northern Colorado The Greater Wattenberg Area (GWA) is a regulatory designation devised by the Colorado Oil and Gas Conservation Commission (COGCC) for the area of prolific oil and gas production adjacent to the Northern Front Range. Part of Larimer County and a portion of Fort Collins are often included in the GWA designation used by the COGCC. GWA is also part of the larger Denver-Julesburg Basin. Oil and gas in the Denver Basin come from several rock formations and depths ranging from less than 900 feet at the Florence field in Fremont County to about 9,000 feet at the Pierce field in Weld County. ii Fort Collins lies within the Front Range Urban Corridor. The urban corridor, located adjacent to and east of the Rocky Mountains in the Colorado and Wyoming portions of the basin, is as much as 40 miles wide and encompasses Denver, Colorado, Cheyenne, Wyoming, and other population centers. More than 1.05 billion barrels of oil and 3.67 trillion cubic feet of natural gas have been produced from wells across the Denver Basin. Of this, 245 million barrels of oil and 2.15 trillion cubic feet of natural gas are from wells within the Front Range Urban Corridor; this totals about 23 percent of the oil and 58 percent of the gas produced in the basin. The Denver Basin encompasses more than 70,000 square miles from eastern Colorado, southeastern Wyoming and southwestern Nebraska. The area has an extensive petroleum exploration history. The first oil well in the Denver Basin was completed in 1881 in the Florence field, the oldest continuously working oil field in the United States. The basin contains more than 1,500 oil and (or) gas fields, 96 of which are within the corridor. Currently producing sandstone reservoirs range in age from Paleozoic through Cretaceous. iii Across the Denver Basin, 187 wells have recorded production from Paleozoic-age rocks. Sixty- seven of these are within the urban corridor and produce mainly oil from the Permian Lyons Sandstone (fig. 2). Corresponding oil fields are Baxter Lake, Berthoud, Black Hollow, Douglas Lake, Fort Collins, Lake Canal, Loveland, New Windsor, and Pierce (fig. 4). All of these fields are located north and northeast of Boulder in Larimer and Weld Counties. Paleozoic-age rock formations that produce oil and gas include (from shallowest to deepest):  Pierre Shale – including Sharon Springs, Hygiene “Shannon”, and Sussex  Niobrara formation (shale and limestone)  Codell sandstone  “D” sandstone  Muddy “J” sandstone  “Dakota”  “Lakota”  Lyons sandstone Fort Collins The wells drilled within the Fort Collins Field were drilled with several target formations in mind. Initially, wells drilled in 1925 sought to reach the Hygiene (Pierre Shale) or the Muddy “J” sandstone. This is consistent with the discovery in 1923 of oil from the Muddy “J” in the Wellington Field to the north of Fort Collins. The Wellington Field was the first set of wells producing from the Muddy “J” in the Denver Basin. Muddy “J” sandstone near Fort Collins exists at a depth of approximately 4,500 feet with an average thickness of 25 feet.iv As demonstrated in Figure 2, the western flank of the Denver Basin, including the Muddy “J” steeply rises near Fort Collins. Going east from Fort Collins, there is greater depth beginning along Interstate-25. The shallower portions of the rock to the west of the City are not likely to have marketable oil and gas supplies. Prospect Energy’s operations in the Fort Collins Field are in the Muddy “J” formation. The company has tested the Niobrara in the Fort Collins Field but has not yet found a well that would be profitable. These results reflect the historical development of oil and gas in Fort Collins where operators have attempted to produce oil and gas from the Lyons, Lakota, Dakota, Codell, Niobrara and the Hygiene formations. A detailed review of COGCC records indicates the Muddy “J” is the only formation that has ever profitably produced within Fort Collins. As hydraulic fracturing and drilling technology advance it remains possible that other formations lying beneath Fort Collins might produce oil and gas. i Chapter 3 A Model for Determining Potential Areas of Future Oil and Gas Development, Greater Wattenberg Area, Front Range of Colorado By Troy Cook of Energy Resource Studies, Northern Front Range Colorado Edited by Neil S. Fishman; U.S. Geological Survey Digital Data Series DDS–69–P ii Pg 1; Chapter 2 of Oil and Gas Exploration and Development along the Front Range in the Denver Basin of Colorado, Nebraska, and Wyoming Compiled by Debra K. Higley; U.S. of Energy Resource Studies, Northern Front Range Colorado Edited by Neil S. Fishman; U.S. Geological Survey Digital Data Series DDS–69–P iii Pg 1; Chapter 2 of Oil and Gas Exploration and Development along the Front Range in the Denver Basin of Colorado, Nebraska, and Wyoming Compiled by Debra K. Higley; U.S. of Energy Resource Studies, Northern Front Range Colorado Edited by Neil S. Fishman; U.S. Geological Survey Digital Data Series DDS–69–P iv Pg 8; Chapter 2 of Oil and Gas Exploration and Development along the Front Range in the Denver Basin of Colorado, Nebraska, and Wyoming Compiled by Debra K. Higley; U.S. of Energy Resource Studies, Northern Front Range Colorado Edited by Neil S. Fishman; U.S. Geological Survey Digital Data Series DDS–69–P Memorandum To: Oil and Gas Team From: Melissa Hovey/Environmental Planner-Air Quality Date: 2/5/2013 Re: Current Studies on Air Emissions from Oil and Gas Development Staff advisors to City Council have been asked to collect information on the state of the science pertaining to environmental impacts from oil and gas development. This memo summarizes information from studies that address potential impacts to air quality due to emissions from oil and gas exploration and production activities. Several current studies pertinent to the Front Range or Rocky Mountain region were briefly reviewed to support the following conclusions (citations are listed below):  Measurable emissions of several pollutants attributable to drilling, construction, material storage and treatment, production, and transmission activities from oil and gas operations have been detected including the following: o Nitrogen oxides (NOx) and volatile organic compounds (VOCs) which are ozone precursors, o Hazardous air pollutants (HAPS) including several carcinogens (primarily benzene and formaldehyde) and other air toxics associated with chronic and sub- chronic health effects (respiratory and neurologic disease and head, throat, and eye irritation), o Particulate matter including dust and aerosols, o Odors (hydrogen sulfide and odiferous hydrocarbons), o Nitrogen and sulfur compounds that contribute to visibility impairment (haze) and atmospheric deposition (acid rain). o Methane, a potent greenhouse gas and ozone precursor.  Oil and gas development activities can emit raw (non-combusted) natural gas which has a unique signature that can be differentiated from motor vehicle emissions and other industrial or combustion sources. Elevated levels of volatile organic compounds associated with natural gas operations (drilling and venting) were found in the Front Range area.  Hydrocarbons emitted from oil and gas activities along the Front Range (primarily propane and other alkanes) comprise some of the highly reactive precursors important in the complex atmospheric chemistry responsible for winter ozone formation. Winter ozone formation is a recently discovered phenomenon that has clearly been attributed to emissions from oil and gas development and production activities in the Green River Basin (Wyoming) and Uintah Basin (Utah).  Potential impacts to human health including excess cancer risk and chronic non-cancer health impacts have been measured at locations within 0.5 miles of active well pad sites. ATTACHMENT 2 Memorandum  Additional studies, many of which are currently ongoing, will help to define the potential risk to human health, effectiveness of air emission control strategies, and potential impacts to air quality from oil and gas development activities. References Colborn T, Schultz K, Herrick L, and Kwiatkowski C. An Exploratory Study of Air Quality Near Natural Gas Operations. 2012 (in press). Hum Ecol Risk Assess. Available at: http://www.endocrinedisruption.com/files/HERA12- 137NGAirQualityManuscriptforwebwithfigures.pdf. Gidney, B.; Pena, S. Upstream Oil and Gas Storage Tank Project Flash Emissions Models Evaluations; Final Report; Texas Commission on Environmental Quality, (July 16, 2009). Available at http://www.tceq.texas.gov/assets/public/implementation/air/am/contracts/reports/ei/20090716- ergi-UpstreamOilGasTankEIModels.pdf Gilman JB, Lerner B, Kuster WC, de Gouw J, Source Signature of Volatile Organic Compounds (VOCs) from Oil and Natural Gas Operations in Northeastern Colorado. (Jan 14, 2013). Environ. Sci. Technol. DOI: 10.1021/es304119a . Available at: http://pubs.acs.org/doi/abs/10.1021/es304119a McKenzie LM, et al. Human Health Risk Assessment of Air emissions from Development of Unconventional Natural Gas Resources. (Feb. 2012). Sci Total Environ. DOI:10.1016/j.scitotenv.2012.02.018 http://cogcc.state.co.us/library/setbackstakeholdergroup/Presentations/Health%20Risk%20Asses sment%20of%20Air%20Emissions%20From%20Unconventional%20Natural%20Gas%20- %20HMcKenzie2012.pdf NOAA, State of Utah, EPA, BLM, Western Energy Alliance. 2012 Uintah Basin Winter Ozone and Air Quality Study - Summary of Interim Findings, Ongoing Analyses, and Additional Recommended Research. (Aug. 7, 2012). Available at: http://www.deq.utah.gov/locations/uintahbasin/docs/2012/Aug/UBOSWinter2012InterimFinding sMitigation%20.PDF Pétron G, Frost G, Miller BR, et al. Estimation of Emissions from Oil and Natural Gas Operations in Northeastern Colorado. (2012) Earth System Research Laboratory, National Oceanic & Atmospheric Administration, Boulder, CO. http://www.epa.gov/ttnchie1/conference/ei20/session6/gpetron.pdf Pétron G, Frost G, Miller BR, et al. Hydrocarbon Emissions Characterization in the Colorado Front Range: A Pilot Study, (Feb. 2012). J. Geophys. Res., 117, D04304, doi:10.1029/2011JD016360. More information available at: http://researchmatters.noaa.gov/news/Pages/COoilgas.aspx Memorandum Skone TJ, Littlefield J, and Marriott J. Life Cycle Greenhouse Gas Inventory of Natural Gas Extraction, Delivery and Electricity Production. (2011). DOE/NETL-2011/1522.: US Department of Energy, National Energy Technology Laboratory, Pittsburgh, PA, USA. Available at: http://www.netl.doe.gov/energyanalyses/pubs/NG-GHG-LCI.pdf Sublette County, Wyoming Department of Environmental Quality, Wyoming Department of Health. Screening Health Risk Assessment, Sublette County, Wyoming. (Jan 2011) Available at: http://www.sublettewyo.com/DocumentCenter/Home/View/438 Texas Commission on Environmental Quality. Condensate Tank Oil and Gas Activities: Final Report, prepared by Eastern Research Group. (October 10, 2012). Available at: http://www.tceq.texas.gov/assets/public/implementation/air/am/contracts/reports/ei/5821199776 FY1211-20121031-ergi-condensate_tank.pdf Texas Commission on Environmental Quality. Characterization of Oil and Gas Production Equipment and Develop a Methodology to Estimate Statewide Emissions: Final Report, prepared by Eastern Research Group. (Nov. 24, 2010). Available at: http://www.tceq.texas.gov/assets/public/implementation/air/am/contracts/reports/ei/5820784003 FY1026-20101124-ergi-oilGasEmissionsInventory.pdf Tollefson J. Air Sampling Reveals High Emissions from Gas Field. (Feb. 2012). Nature.com. Available at: http://www.nature.com/news/air-sampling-reveals-high-emissions-from-gas-field- 1.9982 U.S. Environmental Protection Agency. Integrated Science Assessment for O3 and Related Photochemical Oxidants: Third External Review Draft. (June 2012). U.S. Environmental Protection Agency, Research Triangle Park, NC. Available at: http://cfpub.epa.gov/ncea/isa/recordisplay.cfm?deid=242490 U.S. Environmental Protection Agency. Regulatory Impact Analysis: Proposed New Source Performance Standards and Amendments to the National Emissions Standards for Hazardous Air Pollutants for the Oil and Natural Gas Industry. (July 2011). Office of Air and Radiation, Office of Air Quality Planning and Standards, Research Triangle Park, NC. Available at: http://www.epa.gov/ttnecas1/regdata/RIAs/oilnaturalgasfinalria.pdf U.S. Environmental Protection Agency. Draft Residual Risk Assessment for the Oil and Gas Production and Natural Gas Transmission and Storage Source Categories. (July 2011). Office of Air and Radiation, Office of Air Quality Planning and Standards. Available at: http://epa.gov/airquality/oilandgas/pdfs/20110728risk.pdf Western Energy Alliance, Western Governors’ Association, Environ. A Comprehensive Emissions Inventory of Upstream Oil and Gas Activities in the Rocky Mountain States. Presented at EPA Conference (April 2012). Available at: http://www.epa.gov/ttnchie1/conference/ei20/session6/abarilan.pdf Memorandum Wyoming Department of Environmental Quality. Final Report 2012 Upper Green River Ozone Study (Oct. 2012). Available at: http://deq.state.wy.us/aqd/downloads/AirMonitor/Final%20Report_UGWOS%202012_October %202012.pdf Ongoing Research 1. University of Texas, nine oil companies, and Environmental Defense Fund are conducting a major field study to measure emissions from natural gas production in several geographic areas. Estimated completion date: Jan. 2013. More information available at: http://www.engr.utexas.edu/news/7416-allenemissionsstudy 2. Garfield County Board of County Commissioners and Colorado State University are conducting a three year study on air emissions near well pad activities. Estimated completion date is fall of 2015. More information available at: http://www.garfield- county.com/news/administration-air-quality-study-iga.aspx 3. COGCC, CDPHE, and CDNR will sponsor a three year study by Colorado State University to study emissions from oil and gas development in the Front Range. Estimated completion date (assuming full funding is procured) is June 2016. More information available at: http://dnr.state.co.us/SiteCollectionDocuments/News/Statetoundertakemajorstudyonoilan dgasemissions.pdf 4. Wyoming DEQ is continuing its winter ozone study in the Upper Green River Basin to better define associated health impacts and the effectiveness of NOx and VOC control strategies. 5. NOAA and the State of Utah are continuing to study the winter ozone formation chemistry in the Uintah Basin. 1 Attachment #3 Hydraulic Fracturing Research Related to Impacts on Water Resources In response to public concern and industry growth, the US House of Representatives requested in 2009 that the US EPA conduct scientific research to examine the relationship between hydraulic fracturing and drinking water resources. The project planning phase involved agency consultation with other federal agencies, state and interstate regulatory agencies, industry, non-governmental organizations, and others in the private and public sector to determine the focus of the study regarding potential impacts on human health and the environment. The resulting primary research questions were directed to investigating impacts to drinking water resources as the priority. The first progress report on the results of this research was published during December 2012 in: EPA, 2012, Study of the Potential Impacts of Hydraulic Fracturing on Drinking Water Resources, Progress Report, EPA 601/R-12/011, Office of Research and Development. The research scope is organized around 5 stages of the hydraulic fracturing water cycle: 1. Water acquisition: What are the possible impacts of large volume water withdrawals from ground and surface waters on water resources? 2. Chemical mixing: What are the possible impacts of hydraulic fracturing fluid surface spills on or near well pads on water resources? 3. Well injection: What are the possible impacts of the injection and fracturing process on water resources? 4. Flowback and produced water: What are the possible impacts of both types of wastewater surface spills on or near well pads on water resources? 5. Wastewater treatment and waste disposal: What are the possible impacts of inadequate treatment of hydraulic fracturing wastewater on water resources? The progress report describes 18 trans-disciplinary research projects underway that can be categorized into 5 different types of research activities including: analysis of existing data from multiple sources, scenario evaluations using complex chemical fate and transport modeling, laboratory studies, toxicity assessments, and both retrospective and prospective case studies. Each research project involves a literature review, extensive stakeholder involvement, and stringent quality assurance requirements including development and peer review of each research project’s Quality Assurance Project Plan (QAPP) by EPA’s Science Advisory Board, an independent and external federal advisory committee. The result is designation of the report as a “Highly Influential Scientific Assessment.” The results from the study are intended to inform the public and provide policymakers at all levels with high- quality scientific knowledge than can be used in decision-making. The literature reviews are subject to a separate quality review that assesses the soundness, applicability and utility, clarity and completeness, uncertainty and variability, and evaluation and review of the data and information before inclusion in the research. The following list includes references accepted for inclusion in the EPA report that are organized by research topic related to water quality. This list is a subset of references reviewed to date that cover the most relevant research topics being investigated; for a complete list refer to the 2012 EPA report listed above. The EPA has compiled and continues to search for literature relevant to the research questions posed in this report including a recent Federal Register notice requesting peer-reviewed data and publications relevant to this study. 2 List of References: Spills of produced water: Healy, R.W., Bartos, T.T., Rice C.A., McKinley, M.P. and Smith B.D. 2011. Groundwater chemistry near an impoundment for produced water, Powder River Basin, Wyoming USA. Journal of Hydrology, 403 (1-2): 37-48. Healy, R.W., Rice, C.A., Bartos, T.T., and McKinley, M.P. 2008. Infiltration from an impoundment for coal-bed natural gas, Powder River Basin, Wyoming: Evolution of water and sediment chemistry. Water Resources Research, 44 (6): W06424. Impacts from spills of fracturing fluid containing BTEX Farhadian, M., Vachelard, C., Duchez, D. and Larroche, C. 2008. In situ bioremediation of monoaromatic pollutants in groundwater: A review. Bioresource Technology, 99 (13): 5296-5308. Seagren, E.A. and Becker, J.G. 2002. Review of natural attenuation of BTEX and MTBE in groundwater. Practice Periodical of Hazardous, Toxic, and Radioactive Waste Management, 6 (3): 156-172. Seo, J.S., Keum, Y.S. and Qing, X.L. 2009. Bacterial degradation of aromatic compounds, International Journal Environmental Research and Public Health. 6 (1): 278-309. Impacts from spills of fracturing fluid containing ethylene glycol Staples, C.A., Williams, J.B., Craig, G.R., and Roberts, K.M. 2001. Fate, effects and potential environmental risks of ethylene glycol: a review. Chemosphere. 43 (3): 377-383. Impacts from spills of fracturing fluid containing phenol Van Schie, P.M. and Young L.Y. 2000, Biodegradation of phenol: mechanisms and applications. Bioremediation Journal, 4 (1): 1-18. Impacts from spills of fracturing fluid containing surfactants Scott, M.J. and Jones, M.N. 2000. The biodegradation of surfactants in the environment. Biochimica et Biophysica Acta. 1508 (1-2): 235-251. Sharma, V.K., Anquandah, G.A.K., Yngard, R.A., Kim, H., Fekete J., Bouzek, K., Ray, A.K. and Golovko, D. 2009. Nonylphenol, octylphenol, and bisphenol-A in the aquatic environment: a review on occurrence, fate, and treatment. Journal of Environmental Science and Health, Part A: Toxic/Hazardous Substances and Environmental Engineering. 44 (5): 423-442. Soares, A., Guieysse, B., Jefferson, B., Cartmell, E., and J.N., L. 2008. Nonylphenol in the environment: a critical review on occurrence, fate, toxicity and treatment in wastewaters. Environment International. 34 (7): 1033- 1049. Van Ginkel, C.G. 1996. Complete degradation of xenobiotic surfactants by consortia of aerobic microorganisms. Biodegradation. 7 (2): 151-164. Impacts from spills of fracturing fluid containing naphthalene’s 3 Haritash, A.K. and Kaushik, C.P. 2009. Biodegradation aspects of polycyclic aromatic hydrocarbons (PAHs): A review. Journal of Hazardous Materials. 169 (1-3): 1-15. Rogers, S.W., Ong, S.K., Kjartanson, B.H., Golchin, J., and Stenback, G.A. 2002. Natural attenuation of polycyclic aromatic hydrocarbon-contaminated sites: review. Practice Periodical of Hazardous, Toxic, and Radioactive Waste Management. 6 (3): 141-155. Debate on extent to which subsurface pathways could cause significant adverse consequences for groundwater resources Davies, R.J. 2011. Methane contamination of drinking water caused by hydraulic fracturing remains unproven. Proceedings of the National Academy of Sciences. 108 (43): E871. Engelder, T. 2012. Peer review letter for Warner, N.R., Jackson, R.B., Darrah, T.H., Osborn, S.G., Down, A., Zhao, K., White, A., and Vengosh, A. 2012. Geochemical Evidence for Possible Natural Migration of Marcellus Formation Brine to Shallow Aquifers in Pennsylvania. Proceedings of the National Academy of Sciences. 109 (30): 11961-11966. Harrison, S.S. 1983. Evaluating systems for ground-water contamination hazards due to gas-well drilling on the glaciated Appalachian Plateau. Ground Water. 21 (6): 689-700. Harrison, S.S. 1985. Contamination of aquifers by overpressurizing the annulus of oil and gas wells. Ground Water. 23 (7): 317-324. Jackson, R.B., Osborn, S.G., Vengosh, A., and Warner, N. 2011. Reply to Davies: Hydraulic fracturing remains a possible mechanism for observed methane contamination of drinking water. Proceedings of the National Academy of Sciences. 108 (43): E872. Myers, T. 2012. Author’s Reply. Ground Water. 50 (6): 828-830. Myers, T. 2012. Potential contaminant pathways from hydraulically fractured shale to aquifers. Ground Water. 50 (6): 872-882. Osborn, S.G., Vengosh, A., Warner, N.R., and Jackson, R.B. 2011. Methane contamination of drinking water accompanying gas-well drilling and hydraulic fracturing. Proceedings of the National Academy of Sciences. 108 (20): 8172-8176. Warner, N.R., Jackson, R.B., Darrah, T.H., Osborn, S.G., Down, A., Zhao, K., White, A., and Vengosh, A. 2012. Geochemical evidence for possible natural migration of Marcellus formation brine to shallow aquifers in Pennsylvania. Proceedings of the National Academy of Sciences of the United States of America. 109 (30): 11961-11966. Investigation of brominated disinfection byproducts in treated drinking water from treatment plants that received hydraulic fracturing wastewaters Brown, D., Bridgeman, J., and West, J.R. 2011. Predicting chlorine decay and THM formation in water supply systems. Reviews in Environmental Science and Biotechnology. 10 (1): 79-99. Plewa, M.J, Muellner, M.G., Richardson, S.D., Fasano, F., Buettner, K.M., Woo, T.T., McKague, B., and Wagner, E.D. 2008. Occurrence, synthesis and mammalian cell cytotoxicity and genotoxicity of haloacetamides: an 4 emerging class of nitrogenous drinking water disinfection byproducts. Environmental Science & Technology. 42 (3): 955-961. Water requirements for hydraulic fracturing in shale gas plays Ground Water Protection Council and ALL Consulting. 2009. Modern Shale Gas Development in the US: A Primer. Ground Water Protection Council and ALL Consulting for US Department of Energy. Available at http://www.netl.doe.gov/technologies/oil-gas/publications/epreports/shale_gas_primer_2008.pdf Accessed by EPA December 12, 2012. Satterfield, J., Kathol, D., Mantell, M., Hiebert, F., Lee, R., and Patterson, K. 2008. Managing Water Resource Challenges in Select Natural Gas Shale Plays. Presented at Ground Water Protection Council Annual Forum, Oklahoma City, Oklahoma. References used by EPA to develop a consolidated list of chemicals associated with fracturing fluids and/or found in flowback and produced water US House of Representatives. 2011. Chemicals Used in Hydraulic Fracturing. Available at http://democrats.energycommerce.house.gov/sites/default/files/documents/Hydraulic%20Fracturing%20Re port%204.18.11.pdf Accessed by EPA November 27, 2012. Colborn, J. Milici, R., Cook, T., Charpentier, R., Kirschbaum, M., Klett, T., Pollastro, R., and Schenk, C. 2011. Assessment of Undiscovered Oil and Gas Resources of the Devonian Marcellus Shale of the Appalachian Basin Province. National Assessment of Oil and Gas Fact Sheet 2011-3092. US Geological Survey. 2 p. Available at http://pubs.usgs.gov/fs/2011/3092/. Accessed by EPA November 30, 2012. US Environmental Protection Agency. 2011. Data Received from Hydraulic Fracturing Service Companies. Non- confidential business information is available at: http://www.regulations.gov/#!docketDetail;rpp=100;so=DESC;sb=docId;po=0;D=EPA-HQ-ORD-2010- 0674 Accessed by EPA November 27, 2012. US Environmental Protection Agency, Office of Water. 2004. Evaluation of Impacts to Underground Sources of Drinking Water by Hydraulic Fracturing of Coalbed Methane Reservoirs. EPA 816-R-04-003. Available at http://water.epa.gov/type/groundeater/uic/class2/hydraulicfracturing/wells_coalbedmethanestudy.cfm. Accessed by EPA November 27, 2012. Pennsylvania Department of the Environment. 2010. Chemicals Used by Hydraulic Fracturing Companies in Pennsylvania for Surface and Hydraulic Fracturing Activities. Available at http://files.dep.state.pa.us/OilGas/BOGM/BOGMPortalFiles/MarcellusShale/Frac%20list%206-30- 2010.pdf Accessed by EPA November 27, 2012. Ground Water Protection Council. 2012. FracFocus well records: January 1, 2011 through February 27, 2012. Available at http://www.fracfocus.org/. Hayes, T. 2009. Sampling and Analysis of Water Streams Associated with the Development of Marcellus Shale Gas. Gas Technology Institute for Marcellus Shale Coalition. Available at http://eidmarcellus.org/wp- content/uploads/2012/11/MSCommission-Report.pdf. Accessed by EPA November 30, 2012. US Environmental Protection Agency. 2011. Sampling Data for Flowback and Produced Water Provided to EPA by Nine Oil and Gas Well Operators (Non-Confidential Business Information). Available at 5 http://www.regulations.gov/#!docketDetail;rpp=100;so=DESC;sb=docId;po=0;D=EPA-HQ-ORD-2010- 0674. Accessed by EPA November 27, 2012. Data also collected from Operator Material Safety Data Sheets (MSDSs) submitted to the US EPA and from data provided by the New York State Department of Environmental Conservation. Memorandum To: Oil and Gas Team From: Lindsay Ex, Senior Environmental Planner Date: 2/6/2013 Re: Current Studies on Habitat Fragmentation from Oil and Gas Development Staff advisors to City Council have been asked to collect information on the state of the science pertaining to environmental impacts from oil and gas development. This memo summarizes information from studies that address potential impacts to habitat fragmentation due to the land use impacts from oil and gas exploration and production activities. Several current studies pertinent to the Front Range or Rocky Mountain region were briefly reviewed to support the following conclusions (citations are listed below):  Wildlife impacts and habitat fragmentation from oil and gas activities have been documented, largely for the Greater Yellowstone and Western Wyoming regions. Species studied include mule deer (Odocoileus hemionus), pronghorn (Antilocapra americana), and greater sage-grouse (Centrocercus urophasianus). The studies largely focused on how migration patterns and winter habitat use could be or have been affected by oil and gas development. o Sawyer et al. (2006) found that mule deer migration patterns changed in the initial year of oil and gas development and that migration patterns did not appear to acclimate three years after well establishment. Instead, mule deer migration patterns continued to drift further from the well pad development areas. High value habitat areas prior to the study shifted to low habitat values throughout the study. Conversely, some areas of low value habitat were predicted to be of higher value, though still less-suitable, as they were further from the oil and gas development areas. o Sawyer et al. (2009) examined three types of well pads and their effects on mule deer migration and found that having a liquids gather system (pipelines) at the site may reduce indirect habitat loss by 38-63% rather than being stored on site. The study also found that drilling in crucial winter range areas created a short-term disturbance. o A further study (Sawyer and Neilson 2011) found that mule deer abundance for the herds in the same area had declined by 23% during 2001-2010, where the oil and gas development had expanded. o Beckmann et al. (2012) studied how natural gas fields impacted pronghorn over a 5-year period (2005-2009) in the Greater Yellowstone Area. The studied found that pronghorn in the area have abandoned up to 82% of their highest quality winter range, though changes in mortality or reproduction were not observed in the 125 female pronghorns the studied tracked. o In the Powder River Basin of Wyoming and Montana, Doherty et al. (2008) found that female greater sage-grouse were 1.3 times more likely to avoid existing habitats that lacked natural gas wells within a 1000 acre area than similar areas with the maximum 12.3 wells allowed per 1000 acre. ATTACHMENT 4 1 Memorandum o One recent study has also examined the impact of oil and gas development on sagebrush-dependent songbirds (Gilbert and Chalfoun 2012). Some species, which are generally more tolerant to disturbance, such as the Horned lark (Eremophila alpestris) did not respond to increases in well densities. However other species, such as the Brewer’s sparrow (Spizella breweri) and sage sparrow (Amphispiza belli) which are dependent on sagebrush communities, had significant population decreases as oil and gas well density increased, suggesting there may be significant impacts to sagebrush-obligate species. o A comprehensive synthesis of oil and gas impacts was recently compiled by The Wildlife Society in 2012. In addition to the issues addressed above, the report also identifies increased noxious weed invasions, impacts to waterfowl from wetland impacts, and the potential for increased competition between deer and elk as highly valued habitat is used for oil and gas development. The report also highlights that the cumulative effects of habitat fragmentation, overall loss, and degradation may prove to have the most impact on wildlife (see also Watkins et al. 2007).  Horizontal drilling may reduce the overall impacts of habitat fragmentation (GWPC 2009), as multiple areas of land can be accessed from a single well pad, but it is difficult to know the extent of this reduction without further study.  Based on the studies available, habitat fragmentation effects from oil and gas development appear to be better understood at the landscape level, e.g., how oil and gas development affects pronghorn and mule deer migration patterns. Thus, the findings from these studies may be best applied at the regional scale, e.g., Larimer County and the Rocky Mountain Foothills.  Staff did not find any research that compared the habitat fragmentation effects of oil and gas development with those of more traditional urban development. References Beckmann J, Murray K, Seidler R, and Berger J. Human-mediated shifts in animal habitat use: Sequential changes in pronghorn use of a natural gas field in Greater Yellowstone. 2012. Biological Conservation 147(1): 222-233. Available at http://www.sciencedirect.com/science/article/pii/S0006320712000043. Doherty K, Naugle D, Walker B, and Graham J. Greater Sage-grouse Winter Habitat Selection and Energy Development. 2008. Journal of Wildlife Management 72(1): 187-195. Available at: http://onlinelibrary.wiley.com/doi/10.2193/2006-454/abstract. Gilbert M and Chalfoun A. Energy Development Affects Population of Sagebrush Songbirds in Wyoming. 2009. Journal of Wildlife Management 73(7): 1052-1061. Available at http://onlinelibrary.wiley.com/doi/10.1002/jwmg.123/abstract. Memorandum Ground Water Protection Council (GWPC). Modern Shale Gas Development in the United States: A Primer. 2009. US Department of Energy, 116 pp. Available at http://www.netl.doe.gov/technologies/oil-gas/publications/epreports/shale_gas_primer_2009.pdf. Sawyer H, Nielson R, Lindzey F, and McDonald L. Winter Habitat Selection of Mule Deer Before and During Development of a Natural Gas Field. 2006. Journal of Wildlife Management 70(2): 396-403. Available at: http://www.bioone.org/doi/abs/10.2193/0022- 541X%282006%2970%5B396%3AWHSOMD%5D2.0.CO%3B2?journalCode=wild. Sawyer H, Kauffman M, and Nielson R. L. Influence of Well Pad Activity on Winter Habitat Selection Patterns of Mule Deer. 2009. Journal of Wildlife Management 73(7): 1052-1061. Available at: http://www.bioone.org/doi/abs/10.2193/2008-478. Sawyer H and Nielson R. Mule Deer Monitoring in the Pinedale Anticline Project Area: 2011 Annual Report, prepared for the Pinedale Anticline Planning Office. 2011. Available at http://www.wy.blm.gov/jio-papo/papo/wildlife/reports/muledeer/2011annualrpt.pd. The Wildlife Society. Impacts of Crude Oil and Natural Gas Developments on Wildlife and Wildlife Habitat in the Rocky Mountain Region. 2012. Technical Review 12-02. Available at http://wildlife.org/documents/technical- reviews/docs/Oil%20and%20Gas%20Technical%20Review_2012.pdf. Watkins, B, Bishop C, Bergman E, Bronson A, Hale B, Wakeling B, Carpenter L, and Lutz D. Habitat guidelines for mule deer: Colorado Plateau shrubland and forest ecoregion. 2007. Mule Deer Working Group, Western Association of Fish and Wildlife Agencies, USA. Available at http://www.muledeerworkinggroup.com/Docs/CPE_Mule_Deer_Habitat_Guidelines.pdf. 1 Attachment #5 Description of Fracturing Technologies One way that fracture stimulation technologies can be categorized is according to the rate at which energy is applied to induce fracturing. The following are the broad categories of fracturing techniques: 1. Hydraulic fracturing involves a relatively low rate of loading of the geologic formation resulting in a 2- winged fracture outward from the well bore approximately 180o apart. The potential penetration for the fracture into the formation can be up to a few hundred feet, and this is the most widely used type of fracturing. 2. At the other extreme, explosive fracturing involves a very rapid loading of the formation, resulting in a highly fracture zone around the wellbore, but usually to a radius not exceeding 10 feet. A radial fracture pattern is created. 3. In between these two extremes is pulse fracturing, characterized by peak pressures resulting in multiple vertical fractures extending radially from the wellbore with penetrations on the order of 10 to 20 feet. Overview of fracturing technologies The oil and gas industry is a conservative industry that tends to continue to use the most productive existing technologies until enough data is collected on new extraction techniques before they are commonly adopted. The following is a list of other fracturing technologies that have seen limited use and for which there may be limited equipment available for field use: 1. Water-based fracturing: Most commonly employed method. Large volumes of “clean” water introduced under high pressure. Water –based hydraulic fracturing can represent 1/3 to ½ of total well costs. Water can be damaging to the geologic formation (e.g., clay swelling) that reduces hydrocarbon extraction. Proppants are employed to keep fractures open. 2. Gel-based fracturing: One example is a liquefied petroleum gas (LPG) or propane based gel that uses a zero-oxygen, closed system and specialized equipment (GASFRAC). There are some claims that gels can also be damaging to the geologic formation, but GASFRAC claims the gel reverts to vapor due to pressure and heat, and then returns to the surface for collection and possible reuse. Proppants are commonly used. 3. Liquid CO2: This technique avoids formation damage, leaves no chemical residue which leads to rapid cleanup, and reduces the use of water that can cause clay swelling. Mixing the fluids poses problems because a purpose-built pressurized blending system is required, and only a few exist. 4. Straight nitrogen without proppant: Nitrogen is pumped as a cryogenic liquid and then heated to form a gas prior to being injected into the well. 5. Coiled tubing fracturing: A continuous roll or “coil” of tubing is used in place of drill pipe or tubing strings. It offers several advantages including portability, a small well site footprint, and the elimination of a rig. This method reduces the risk of wellbore damage from multiple well interventions and down-hole tool runs. 6. Propellant gas fracturing: This is a method of pulse fracturing, also called controlled pulse fracturing, tailored pulse loading, or high energy gas fracturing and involves the use of a wireline run, electrically ignited propellant (similar to solid rocket fuel) which is placed across the formation to create a high pressure pulse. This is less damaging to the wellbore than explosive fracturing techniques. With recent concerns over the possibility that hydraulic fracturing may contaminate aquifers, this technique could be used to guarantee that breakthrough (of the confining layer) will not occur and ensure the fracture does not communicate with overlying aquifers. One disadvantage is that the fractures are left unpropped and are susceptible to closure and plugging. 7. Nitrogen pulse: This is used to create short multi-directional fractures and may be most applicable to coalbed methane wells. This method does not use a proppant, so the fractures are susceptible to closure and plugging. 8. Dry fracturing: Also called exothermic extraction. Few details known due to patent concerns. This involves using hot gases and was originally intended for artic regions where water used in fracking freezes. May also use metal oxides, evaporants, and pumice. When the hot gases expand they crack the shale. 2 Definition of hydraulic fracturing: The technical description of hydraulic fracturing is provided in the following publication: B.C. Haimson, F.H. Cornet, 2003, ISRM Suggested Methods for rock stress estimation – Part 3: hydraulic fracturing (HF) and/or hydraulic testing of pre-existing fractures (HTPF), International Journal of Rock Mechanics and Mining Sciences, 40: 1011-1020. There does not appear to be one universally accepted common definition of hydraulic fracturing because the technology evolved over several decades. This International Society for Rock Mechanics (ISRM) method paper provides a basis for a definition of modern methods of hydraulic fracturing. Oil and Gas Development Potential Existing Wells City Limits Growth Management Area Developement High Probability Low 0 2.5 5 7.5 10Miles © Community Development & Neighborhood Services 281 North College Avenue P.O. Box 580 Fort Collins, CO 80522.0580 970.416.2740 970.224.6134- fax fcgov.com Attachment 10 Planning, Development, & Transportation MEMORANDUM Date: January 25, 2013 To: Mayor and City Councilmembers Through: Darin Atteberry, City Manager Diane Jones, Deputy City Manager – Policy, Planning and Transportation Karen Cumbo, Planning, Development, and Transportation Director From: Laurie Kadrich, Community Development and Neighborhood Services Director Re: Work Session Summary – January 22, 2013 re: Request by City Council Consider Submitting a ballot measure for the April 2, 2013 Municipal election asking voters to ban hydraulic fracturing treatment. City Council in Attendance: Mayor Weitkunat, Mayor Pro Tem Ohlson, Councilpersons Horak, Kottwitz, Manvel, Poppaw, and Troxell. Presenting Staff: Laurie Kadrich, Dan Weinheimer, Wanda Nelson In December 2012 City Council authorized a moratorium preventing any further drilling of oil and gas well in the city limits or on City-owned lands until July 31, 2013. Since that time, citizens asked the Council to consider banning hydraulic fracturing in the city. Staff requested Council’s feedback on three items: Specific Questions: 1. Should the City Council direct staff to draft a ballot measure for the April 2, 2013 Municipal election asking voters to ban hydraulic fracturing treatment in the City of Fort Collins or on City-owned lands? 2. Should the question be addressed by Land Use Code or the Environmental Health section of the Municipal Code? 3. Should the question be limited to hydraulic fracturing or apply to storage, disposal of waste materials? Council Feedback:  In response to Question 1, the City Council directed staff to proceed with drafting a Resolution to be considered at the February 19, 2013 Regular meeting submitting a ballot measure to ban hydraulic fracturing treatment exempting wells that were annexed in the City.  In response to Question 2, the City Council directed staff to address the question in the Environmental Health section of the Municipal Code.  In response to Question 3, the City Council directed staff to include storage and disposal of waste materials. Work Session Summary – January 22, 2013 re: Request by Citizens to Consider Submitting a Ballot Measure January 25, 2013 Page 2 - 2 - Additional Direction Council asked staff to prepare information for the February 19, 2013 meeting to address the following:  Describe the geology of Fort Collins and where drilling activity will likely occur.  Locate science-based studies on hydraulic fracturing.  To be balanced in the information presented using the “triple-bottom” line approach  Describe the financial impacts if a ban were to be imposed.  Pursue negotiation of an operator agreement with the local operator. Work Session Summary – January 22, 2013 re: Request by Citizens to Consider Submitting a Ballot Measure January 25, 2013 Page 3 - 3 - . 1 Should the City Council Ban “Hydraulic Fracturing Treatment”? Laurie Kadrich Director, Community Development & Neighborhood Services Dan Weinheimer Policy and Project Manager Wanda Nelson City Clerk February 19, 2013 City Council Meeting ATTACHMENT 11 2 Items for City Council Consideration: First Reading Ordinance No. 032: Amend City Code to Ban Hydraulic Fracturing and Storage within the City (operator agreement in place). OR Resolution 2013-011: Submit a question on the April Ballot asking whether to Ban Hydraulic Fracturing and Storage within the City (operator agreement in place). 3 Items for City Council Consideration: Resolution 2013-012: • Request for regulatory powers over oil and gas exploration and production locally • Support the City of Longmont in its litigation over home rule authority • Authorize negotiations with Larimer County to regulate oil and gas exploration and production within the Growth Management Area (GMA) 4 Items for City Council Consideration: Provide direction to staff on what option(s) to consider for city-owned lands outside the city limits 1.Include in the City Code, or on a ballot question to ban hydraulic fracturing 2.Include in any Land Use Code requirements following expiration of the moratorium 3.Extend the moratorium on city-owned lands and apply for Designated Outside Activity Areas status through the COGCC 5 Items for City Council Consideration: Provide direction to staff on what option(s) to consider for city-owned lands outside the city limits (cont’.) 4. Utilize the Energy by Design Process for mineral rights owned by the State Land Board: extend those requirements to other mineral owners thru the adoption of surface use agreements 5. Develop surface use agreements for other mineral interests that reflect best practice or meet LUC during the time the mineral right is extracted (rather than committing to the Energy by Design process) 6 What is Hydraulic Fracturing? • Generally allows for more oil or gas recovery • A treatment used by the oil and gas industry to stimulate oil and gas recovery by: – Injecting fluids, including chemicals, under pressure into the well – Designed to fracture geological formations – Enhance production of oil & gas – Commonly referred to as “fracking” 7 Where Does Hydraulic Fracturing Occur? • Nearly every new drilling process uses hydraulic fracturing to stimulate well production • Can also be used to increase production after the well production reduces, application for the extraction of oil and gas products • Some potential for application in the Fort Collins field 8 Existing Wells in Fort Collins City Limits 9 Well Activity City Limits & City-owned Natural Areas 10 Regional Geology 11 Regional Geology, with City Limits and GMA 12 Why are people concerned? • Air Quality – Pollutants – Carcinogens, dust, aerosols, odors – Haze and acid rain • Water Quality – Methane gas – Spills and shallow water contamination – Illicit dumping 13 Why are people concerned? Cont.’ • Waste and Wastewater – Capture, storage and disposal challenges • Earthquake Potential – Deep disposal wells • Habitat Fragmentation (regional concern) – Migration patterns and winter use 14 New COGCC Rules 89.33%City Limits Excluded from Drilling (effective 8/1/13) 15 Staff Recommendation • Adopt Ordinance No. 032 • Adopt Resolution 2013-012 • Limit Ban to City Limits • Continue modifying LUC to greatest extent possible • Continue negotiations with Prospect Energy to develop an operator agreement 16 Items for City Council Consideration: First Reading Ordinance No. 032: Amend City Code to Ban Hydraulic Fracturing and Storage within the City (operator agreement in place). OR Resolution 2013-011: Submit a question on the April Ballot asking whether to Ban Hydraulic Fracturing and Storage within the City (operator agreement in place). 17 Items for City Council Consideration: Resolution 2013-012: • Request for regulatory powers over oil and gas exploration and production locally • Support the City of Longmont in its litigation over home rule authority • Authorize negotiations with Larimer County to regulate oil and gas exploration and production within the Growth Management Area (GMA) 18 Items for City Council Consideration: Provide direction to staff on what option(s) to consider for city-owned lands outside the city limits 1.Include in the City Code, or on a ballot question to ban hydraulic fracturing 2.Include in any Land Use Code requirements following expiration of the moratorium 3.Extend the moratorium on city-owned lands and apply for Designated Outside Activity Areas status through the COGCC 19 Items for City Council Consideration: Provide direction to staff on what option(s) to consider for city-owned lands outside the city limits (cont’.) 4. Utilize the Energy by Design Process for mineral rights owned by the State Land Board: extend those requirements to other mineral owners thru the adoption of surface use agreements 5. Develop surface use agreements for other mineral interests that reflect best practice or meet LUC during the time the mineral right is extracted (rather than committing to the Energy by Design process) ORDINANCE NO. 032, 2013 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING THE CODE OF THE CITY OF FORT COLLINS TO IMPOSE A BAN ON HYDRAULIC FRACTURING AND CERTAIN STORAGE OF WASTE WITHIN THE CITY WHEREAS, in December 2012, the City Council authorized a moratorium preventing any further drilling for oil and gas in the City until July 31, 2013; and WHEREAS, since that time, citizens have requested that the City Council consider imposing a ban on hydraulic fracturing in the City; and WHEREAS, the City Council has determined that in order to preserve the health, safety and welfare of the City residents, hydraulic fracturing should be banned within the City, as well as the storage in open pits of solid or liquid wastes and/or flowback created in connection with the hydraulic fracturing process; and WHEREAS, the City Council has further determined that in order to respect the rights of existing oil and gas operators in the City, the proposed ban on hydraulic fracturing and storage should not apply to any oil or gas wells or pad sites existing within the City as of February 19, 2013, provided that the operators of such wells and/or pad sites enter into satisfactory agreements with the City to regulate their existing and future operations. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS that Chapter 12 of the Code of the City of Fort Collins is hereby amended by the addition of a new Article VIII which reads in its entirety as follows: ARTICLE VIII. HYDRAULIC FRACTURING Sec. 12-135. Hydraulic fracturing/open pit storage prohibited. The use of hydraulic fracturing to extract oil, gas or other hydrocarbons, and the storage in open pits of solid or liquid wastes and/or flowback created in connection with the hydraulic fracturing process is prohibited within the City. Sec. 12-136. Exemptions. The prohibitions contained in §12-135 shall not apply to any oil or gas wells or pad sites existing within the City on February 19, 2013, provided that any such wells or pad sites become the subject of an operator agreement between the operator of the same and the City, which agreement includes strict controls on methane release and, in the judgment of the City Manager, adequately protects the public health, safety and welfare. Introduced, considered favorably on first reading, and ordered published this 19th day of February, A.D. 2013, and to be presented for final passage on the 5th day of March, A.D. 2013. _________________________________ Mayor ATTEST: _____________________________ City Clerk Passed and adopted on final reading on the 5th day of March, A.D. 2013. _________________________________ Mayor ATTEST: _____________________________ City Clerk RESOLUTION 2013-011 OF THE COUNCIL OF THE CITY OF FORT COLLINS SUBMITTING TO THE REGISTERED ELECTORS OF THE CITY A PROPOSED AMENDMENT TO THE CODE OF THE CITY OF FORT COLLINS WHICH WOULD IMPOSE A BAN ON HYDRAULIC FRACTURING AND CERTAIN STORAGE OF WASTE WITHIN THE CITY WHEREAS, in December 2012, the City Council authorized a moratorium preventing any further drilling for oil and gas in the City until July 31, 2013; and WHEREAS, since that time, citizens have requested that the City Council consider imposing a ban on hydraulic fracturing in the City; and WHEREAS, the City Council has determined that in order to protect the health, safety and welfare of City residents, a proposal for a ban on hydraulic fracturing within the City, including a ban on the storage in open pits in the City of solid or liquid wastes and/or flowback created in connection with the hydraulic fracturing process, should be submitted to the registered electors of the City for a vote; and WHEREAS, the City Council has further determined that in order to respect the rights of existing oil and gas operators in the City, the proposed ban on hydraulic fracturing and storage should not apply to any oil or gas wells or pad sites existing within the City as of February 19, 2013, provided that the operators of such wells or pad sites enter into satisfactory agreements with the City to regulate their existing and future operations; and WHEREAS, under Article X, Section 3 of the City Charter, the City Council may submit any question or proposed ordinance or resolution to a vote of the people at a regular or special election. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS that the following question, in substantially the form shown below, shall be submitted to the registered electors of the City of Fort Collins at the general municipal election to be held on April 2, 2013: SHALL CHAPTER 12 OF THE CODE OF THE CITY OF FORT COLLINS BE AMENDED BY ADDING A NEW ARTICLE VIII HEALTH AND ENVIRONMENT TO PROHIBIT WITHIN T H E FORT COLLINS CITY LIMITS THE USE OF HYDRAULIC FRACTURING TO EXTRACT OIL, GAS, OR OTHER HYDROCARBONS, AND TO PROHIBIT WITHIN THE FORT COLLINS CITY LIMITS THE STORAGE IN OPEN PITS OF SOLID OR LIQUID WASTES AND/OR FLOWBACK CREATED IN CONNECTION WITH THE HYDRAULIC FRACTURING PROCESS, AND EXCEPTING FROM THESE PROHIBITIONS ANY OIL OR GAS WELL OR WELL PAD SITE THAT EXISTED WITHIN THE CITY AS OF FEBRUARY 19, 2013, PROVIDED THAT THE OPERATOR OF SUCH WELL OR PAD SITE ENTERS INTO AN AGREEMENT WITH THE CITY THAT SPECIFICALLY IMPOSES STRICT CONTROLS ON ANY METHANE RELEASED IN CONNECTION WITH SUCH OPERATIONS AND THAT, IN THE JUDGMENT OF THE CITY MANAGER, ADEQUATELY PROTECTS THE PUBLIC HEALTH, SAFETY AND WELFARE? YES _______ NO_______ Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 19th day of February A.D. 2013. Mayor ATTEST: City Clerk RESOLUTION 2013-012 OF THE COUNCIL OF THE CITY OF FORT COLLINS REQUESTING STATUTORY POWER TO REGULATE OIL AND GAS EXPLORATION AND PRODUCTION, SUPPORTING THE CITY OF LONGMONT IN ITS LITIGATION WITH THE STATE OF COLORADO CONCERNING THE REGULATION OF OIL AND GAS EXPLORATION AND PRODUCTION AND AUTHORIZING NEGOTIATIONS WITH LARIMER COUNTY REGARDING OIL AND GAS REGULATIONS IN THE CITY'S GROWTH MANAGEMENT AREA WHEREAS, the exploration for and production of oil and gas within the City presents significant health, safety and welfare issues for the City and its citizens and, in particular, presents significant risk to the environment of the City as it relates to both air and water quality and the aesthetic interests of the City; and WHEREAS, the Colorado Oil and Gas Conservation Commission has commenced litigation against the City of Longmont with the goal of preventing the Longmont City Council and the citizens of Longmont, through the exercise of their power of initiative, from enacting and implementing local regulations of oil and gas operations; and WHEREAS, the City Council believes that it is in the best interests of the citizens of the City to support, and seek the expansion of, the power of home rule cities to regulate oil and gas exploration and production within their territorial boundaries. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby requests that the Governor and Attorney General support the Colorado General Assembly in enacting legislation that will explicitly grant Colorado home rule cities broad regulatory powers over oil and gas exploration and production within their municipal boundaries. Section 2. That the City Council hereby supports the City of Longmont in its litigation with the State of Colorado concerning the power of home rule cities to regulate the exploration for and production of oil and gas development within the boundaries of the City of Longmont. Section 3. That the City Council hereby expresses its intent to negotiate with the Board of Commissioners of Larimer County for the establishment of County regulation of oil and gas exploration and production outside of the City but within the Fort Collins Growth Management Area. Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 19th day of February, A.D. 2013. Mayor ATTEST: City Clerk