Dan Haley of the Colorado Oil & Gas Association talked the dangers of about Proposition 112. Photos by Freda Miklin
BY FREDA MIKLIN
Both candidates for Colorado governor, Republican State Treasurer Walker Stapleton and Democratic U. S. Rep. Jared Polis have come out publicly against the passage of Proposition 112, which seeks to create 2,500-foot setbacks for new oil and gas drilling operations.
At their regular monthly meeting at Maggiano’s DTC Sept. 5, members of the Arapahoe County Republican Breakfast Club heard Dan Haley, president of the Colorado Oil and Gas Association, talk about the potential impacts on Colorado’s economy if Proposition 112 is passed by the voters in November. Founded in 1984, the Colorado Oil & Gas Association’s mission is to foster and promote the beneficial, efficient, responsible and environmentally sound development, production and use of Colorado oil and natural gas.
“The U.S. is the top producer of oil and natural gas in the world,” Haley said, bigger than both Russia and Saudi Arabia. “Our country is now an exporter of oil and gas,” he continued. Although renewable energy is a good goal, Haley explained, there will still be a need for oil and gas in the foreseeable future. He described the industry as employing 36,000 people with average salaries over $100,000 and having a $32 billion statewide annual economic impact, including over $1 billion in state and local taxes.
A study, The Economic and Fiscal Impacts of 2018 Initiative 97, (now called Proposition 112) was completed in July by the Common Sense Policy Roundtable, a consortium of public and private organizations that has been meeting monthly since 2013, “to provide Colorado lawmakers, policymakers, business leaders and citizens, with greater insight into the economic impact of public policy decisions that face the state and surrounding regions.” The study was reviewed by two Ph.D.’s from the economics and business division of the Colorado School of Mines in Golden, who issued a letter approving its methods and calling it “a well thought out and comprehensive piece of research.”
The startling conclusion of the study is that passage of Proposition 112 would result in up to 43,000 lost jobs in Colorado in 2019 and up to 147,000 in the decade to follow. Further assessing the impact of a 2,500-foot setback as described in Proposition 112, the report states that, “The direct loss in state and local tax revenue from new oil and gas activity, including from severance taxes, property taxes, income taxes, and sales and use taxes, would range from between $201 million and $258 million in the first year, growing to between $825 million and $1.1 billion by 2030.”
It goes on to say that, “A change from the existing 500-foot setback requirement to a 2,500-foot requirement would eliminate between 62 percent and 80 percent of annual new oil and gas development in the state. By 2030, it would reduce the total value of production in the state by between 54 percent and 70 percent.
ACRBC attendees were happy to see former Centennial Mayor Cathy Noon looking well, seen here with current Mayor Stephanie Piko.
Reminding readers that,” The industry operates within some of the nation’s strictest regulations regarding safety, water monitoring and air quality,” the report further clarifies that only 23 percent of the jobs lost in the decade following passage of Proposition 112 would be in the oil and gas extraction industry. The great majority of the lost jobs, amounting to 77 percent of the total, would come from industries not directly related to energy production, specifically including retail, professional services, healthcare and construction.
Supporting the economically disastrous findings of the Common Sense Policy roundtable study is an earlier study from 2016 by the University of Colorado’s Leeds School of Business, which found that, “a 2,500-foot setback would curtail accessible drilling locations by 90.2 percent.”
Haley also pointed out that the onerous setback increase would impact private property mineral rights. The Colorado Alliance of Mineral and Royalty Owners represents the interests of over 600,000 mineral owners across the state. They strongly object to Proposition 112. In their opinion, “Oil and gas development would be effectively shut down in the state if [Proposition 112] passes and imposes a 2,500-foot setback on oil and gas development in Colorado.”
While it is unarguably important that Coloradans who live, work, or play in proximity to oil and gas drilling operations must be kept safe, an overwhelming number of people and organizations believe that Proposition 112 is not the right way to ensure that that goal is achieved.
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