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Energy

Colorado regulators approve tougher rules for new oil and gas wells

FILE PHOTO: An oil well pump jack is seen at an oil field supply yard near Denver, Colorado, U.S., February 2, 2015. REUTERS/Rick Wilking/File Photo

DENVER (Reuters) - Colorado’s oil and gas regulator on Monday approved tougher permitting rules for new oil and gas wells, including requiring a 2,000-foot (610 meter) separation between wells and homes or public spaces, from the current 500-foot setback.

Regulators had given preliminary approval for the rule in September and the unanimous vote by the five-person commission was expected. The 2,000-foot separation, opposed by some industry groups, takes effect Jan. 15. It allows drillers to seek exceptions in some cases.

The new rules allow “transparent and protective oil and gas development,” Commissioner Bill Gonzalez said following the vote. “These rules do not effectively ban oil and gas development” in the state, he said, rebutting criticism of the wider setback.

Colorado produced 444,000 barrels oil per day in August, tied with Alaska as the fifth-largest U.S. oil-producing state, according to the latest data available from the U.S. Energy Information Administration (EIA). Activists in the state had tried to pass similar legislation in the past.

There are 4,600 permits before the commission for new oil and gas wells, and all will fall under the new rules, said Megan Castle, a commission spokeswoman.

The setback rule came out of legislation passed last year that altered the commission’s mission. That law requires the Oil and Gas Conservation Commission to protect public health, safety, welfare and the environment, a change from its prior role of fostering development.

The rules “will likely give untethered discretion to the Director and the commission” on permitting, said Lynn Granger, executive director of industry group API Colorado. It will “work closely with the commission, staff and energy-producing communities to better clarify and implement” the rules, she said.

Reporting by Liz Hampton; Editing by Tom Brown and Dan Grebler

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