Town staff on Tuesday night presented Erie trustees with proposed amendments to the town’s operator agreement with Encana Oil and Gas in response to the state regulating body refusing to enforce some of the terms of the agreement.
The amendments specify that Encana must follow guidelines laid out in the agreement, including terms that exceed state regulations enforced by the Colorado Oil and Gas Conservation Commission, or COGCC.
Questions about the enforceability of the agreement brought up during a meeting in February also are addressed in the amendments.
“The Town shall retain its independent authority to enforce such terms and conditions,” according to the amendments.
The amendments require Encana to submit a copy of the agreement as part of any state applications in the area covered under the agreement, which was approved by the Board of Trustees in August.
Trustees had little response to the proposal Tuesday other than comments by Mayor Pro Tem Mark Gruber and Trustee Dan Woog, who said they were tired of spending money on the agreement.
In February, trustees directed town staff to consult special counsel hired by Erie to help draft the agreement about the concerns.
Erie spokesman Fred Diehl said Tuesday that the town has spent at least $4,000 on special counsel to address the questions, bringing the total amount spent on the agreement to about $120,000.
The amendments will come back to trustees for approval on March 22, Diehl said.
Encana spokesman Doug Hock reiterated the company’s dedication to the agreement in an email Tuesday.
“We intend to stand behind the conditions of the agreement, regardless of whether enforcement is through the town or the state,” Hock wrote.
Concerns arose about the agreement following a January letter from the COGCC Director Matthew Lepore to Town Administrator A.J. Krieger that refused to include 11 of the agreement’s 18 best practices in a permit for wells planned for the Morgan Hills pad site.
The commission omitted specifications addressing lighting requirements, recycling and reuse of town water, traffic management, road repairs and fencing because they are not covered under the group’s jurisdiction.
Whitney Bryen: 303-473-1113, firstname.lastname@example.org or twitter.com/soonerreporter