Boulder County plans to lease mineral rights for drilling rig

Boulder County has received a letter from Extraction Oil and Gas threatening to seek a pooling order if the county does not lease mineral rights for a Weld County drilling project.

Extraction’s “Blue Paintbrush” rig is located approximately 1,000 feet east of the Boulder County line on land on which Boulder County has a conservation easement.

Mining has permits from the Colorado Oil and Gas Conservation Commission to drill up to 32 wells on the pad, but the Blue Paintbrush wells are designed to drill horizontally from the Weld County site to produce oil and gas under four square miles of Boulder County, where Boulder County is the majority mineral owner.

Boulder County sued in 2018, arguing that its conservation easement and several existing leases do not permit approved drilling, but that suit was unsuccessful.

According to a statement, Boulder County received a mining letter on July 5 offering to lease the mining rights owned by the county. If the county does not agree to lease 552 acres of mineral rights or accept a working interest in the Blue Paintbrush pits, Extraction said it will seek a statutory pooling order from the COGCC.

“In the event that we do not receive your election within 60 days, we will assume that you do not wish to lease your mining interest,” the letter read. “(Extraction Oil and Gas) will then proceed to drill these wells in accordance with the terms of its existing oil and gas leases and applicable COGCC rules and orders.”

Extraction already filed an application with the COGCC on July 7 to force the pooling of minerals, but the application is now in a regulatory pending period.

In the statement, Boulder County officials said they believe the county “has a strong case against forced pooling,” but not agreeing to lease risks the county having to share the cost of drilling and oil and gas production.

“Boulder County has a long-standing policy of not voluntarily leasing its mineral rights for development,” the statement said. “However, given the threat of forced pooling and the significant amounts of land, minerals and money at stake in this situation, the county will complete a full public process before making a decision on the offer.”

The Boulder County Parks and Open Spaces Advisory Committee will consider Extraction’s lease offer at a public hearing on Thursday, the first step in the process to determine whether to lease open spaces for the development.

To provide feedback to the advisory committee, residents can register to speak at the meeting. The meeting can also be viewed remotely at boco.org/posac.

The advisory committee will then make a recommendation to the County Board of Commissioners, who will address the matter at a public hearing on November 1.

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