Fracking Insider Readers: We are pleased to bring you Volume 35 of our State Regulatory Roundup, including updates in Colorado, Maryland, and North Dakota. As we explained in earlier volumes, we designed the Roundup to provide quick overviews on state regulatory activity. If you have any questions on any of these summaries, please do not hesitate to ask.
Colorado – In a June 24th vote, voters in Loveland rejected a ballot measure that would have instituted a two-year moratorium on hydraulic fracturing within city limits. The proposed ballot measure failed by approximately 900 votes, out of 21,000 total votes cast. Despite the rejection, fracking opponents have continued their campaign to gather signatures for two statewide ballot measures. One would increase the distance rigs must be set back from homes, from 500 feet to 2,000 feet, and the other would create an Environmental Bill of Rights which would give local communities greater control over oil and gas activities. The deadline for submitting signatures to qualify for the fall ballot is August 4th.
Maryland – The Federal Energy Regulatory Commission (FERC) has issued its environmental assessment (EA) for the Cove Point LNG liquefaction and export facility proposed by Dominion Cove Point LNG LP (DCP) that would have an annual export capacity of 5.75 million tonnes of LNG, to be transported by LNG marine carriers docking at an existing offshore pier. The EA concluded that approval of the project would not significantly affect the quality of the human environment, and that DCP’s proposed minimization and mitigation measures, along with 82 additional measures recommended in the EA, would reduce potential impacts. The project will be sited within the 131-acre footprint of the existing LNG import facility, negating the need for additional pipeline, storage tank, and pier construction. Nonetheless, the company still needs to obtain about 50 additional permits and approvals before construction can begin. Dominion filed its prefiling process notice with FERC in June 2012, and its application for the Commission’s approval in April 2013.
North Dakota – The North Dakota Industrial Commission issued an order on July 1st that establishes oil production limits that will take effect if an operator fails to capture natural gas at a well site. The order is intended to reduce natural gas flaring from production in the Bakken and Three Forks formations. The Commission approved a six-step policy last March aimed at reducing flaring, which included a requirement that a producer have a gas capture plan (GCP) as of June 1st. A GCP is a detailed plan of how much gas an operator expects to produce from a well, how the operator plans to deliver the produced gas to a processor, and where the processing will take place. The new order establishes an enforcement mechanism for the GCP requirement under which an operator that fails to comply with a GCP or meet flaring reduction targets can face new production restrictions. The Commission intends to reduce flaring to 26% by the 4th quarter of 2014, 23% by the 1st quarter of 2015, 15% by the 1st quarter of 2016, and 10% with the potential for 5% by the 1st quarter of 2020.
With assistance from Andrew McNamee