City of Longmont, Colorado: City Council to Consider a “No Drilling Within City Limits” Agreement with Two Oil and Gas Operators

On May 8 the Longmont City Council will consider an agreement with two oil and gas operators, TOP Operating (TOP) and Cub Creek Energy (Cub Creek). The agreement will essentially end oil and gas drilling within Longmont city limits in return for a cash payment of $3 million.

The agreement stipulates that TOP Operating will plug and abandon eight active wells, relinquish 11 future drilling sites, abandon 80 potential well permits, and never again drill from within city limits. The first well closure will be required to take place within 120 days of the agreement.

As part of the agreement, Cub Creek has committed to forever relinquish any right to drill inside Longmont city limits or on City-owned property, conditioned upon the state approving its proposed well location in Weld County northeast of Union Reservoir. Moreover, Cub Creek will immediately cease all attempts to “force pool” the city’s oil-and-gas mineral rights that are located under City-owned open space east of Union Reservoir and will, alternatively, lease them directly from the City. Any payments due to TOP are to be made from the receipt of these future mineral royalties.

“These were tough negotiations,” said Mayor Brian Bagley. “Personally, I take great satisfaction in seeing this particular chapter come to a conclusion after more than six years of hard work. The City’s goal has always been to

protect the health and safety of our residents by creating as much distance as possible between heavy industry and our homes. This agreement does just that. I want to thank all of the parties for their perseverance and determination in finding a solution to a very complicated, emotional issue.”

The ordinance to approve the agreement will be introduced to the City Council at its May 8 meeting, and the public hearing is scheduled for May 22.

Background

In 2012, when faced with more than 200 directional wells proposed on open space within the Longmont portion of Weld County, City staff engaged in negotiations with TOP with the goal of minimizing the number of wells. This led to the development and execution of a master contract in July of 2012, which included 11 consolidated areas that would be available for drilling, yet ensured that each location exceeded the

voluntary standards of the City’s oil and gas regulations.

At the same time, members of the community organized a ballot-issue petition that led to a vote in November 2012, banning fracking within the City of Longmont. However, the Colorado Supreme Court eventually overturned the ballot issue, Amendment 300, in May of 2016.

Following the Supreme Court’s decision, TOP assigned its drilling rights to Cub Creek. Longmont then began negotiations with Cub Creek to permanently end surface disruption due to the extraction of oil and gas from within city limits. Throughout the course of these negotiations, the City fought to minimize the impacts of oil and gas production in and around Union Reservoir, including the location/relocation of drilling outside city limits. This work culminated in the agreement that is to come before the City Council on May 8.

You can view the entire communication and agreement on the City's website: http://webapp.ci.longmont.co.us/mtgviewer.aspx?meetid=865&doctype=agenda&itemid=12304