Frac ban exemption made in Broomfield

Dec. 12, 2014
A Colorado District Court judge has ruled that a hydraulic fracturing ban in Broomfield, Colo., does not apply to an operator that entered into an agreement with the city before the ban was passed.

A Colorado District Court judge has ruled that a hydraulic fracturing ban in Broomfield, Colo., does not apply to an operator that entered into an agreement with the city before the ban was passed.

The court upheld Sovereign Operating Co.'s claim that the city's fracing ban, passed in 2013, cannot retroactively apply to operations covered by that memorandum of understanding (MOU).

District Court Judge Christopher Melonakis issued the ruling on Sept. 25. He found that Sovereign's contractual rights under the MOU had "undoubtedly vested," and the ban violated the state constitution's prohibition against ex post facto laws.

Tom Metzger, chairman and chief operating officer of Sovereign, said his company agreed to three continuances of its Use by Special Review permit process that allow the city to conduct public forum study sessions, receive expert third party advice on oil and gas operations, and hold a town hall meeting to receive public input. The process culminated in operator and the city entering into the MOU with stringent regulations to address local needs.

"We're pleased that the court said clearly that local agreements between an operator and a municipality like the one Sovereign entered into can't be violated retroactively by fracing bans," Metzger said.

Colorado Oil and Gas Association Pres. Tisha Schuller called the ruling a victory for certainty and clarity in the way Colorado regulates oil and gas regulations. "In just the last several months three previous rulings have found that fracing bans are on their face unlawful and now another court has found that agreements between a city and a local operator prior to bans passing are binding," Schuller said.