The following is testimony given by Ed Behan, Larimer Alliance member, to the Board of County Commissioners (BOCC), during their General Administrative public meeting, Tuesday, March 2, 2021:
Good morning, Commissioners. . . My name is Ed Behan and I live in Fort Collins. I’m speaking today to ask you to take care that Larimer County’s revised Oil & Gas regulations include adequate financial protections, ensuring that bankrupt Oil & Gas companies don’t leave county taxpayers on the hook for abandoned wells.
The oil and gas industry is chronically subject to boom and bust cycles, as I noted living for fifteen years in Texas and Louisiana. This predates the pandemic with the effect it had on the economy, but that certainly didn’t improve the situation. As reported by the New York Times last summer, numerous companies declared bankruptcy within a few months last spring, including Extraction Oil & Gas, which operates wells here in Larimer County. It’s worth noting that Extraction paid its executives a whopping $6.7 million dollars in “retention agreements” last summer, just three days before declaring bankruptcy. I don’t believe these companies have concern for the health, safety or the environment of Larimer County at heart.
Companies paying their executives millions before filing as bankrupt are at risk of abandoning their responsibility for the safety of their wells, or to clean up and restore the environment after shutting down. In fact, the New York Times cites an estimated cost of $300,000 to plug a typical well after it is abandoned or “orphaned.” I will note as well at least one oil “investment” firm in Texas has eyes on developing a major project here in Larimer County under a strategy they call “Acquire, Develop, Divest,” which does not sound like a long term commitment to responsible operation.
The handout I will give you has a link to their website’s specific page on their Larimer County proposal. I will also provide for you the lead page of that New York Times reporting, with a link to the whole article at the bottom. In revising Larimer County’s Oil & Gas regulations, I urge you to mandate that any new wells have a bond of at least $300,000 to ensure that Larimer County residents like you and me
don’t end up paying for the damage caused when Oil & Gas operators go bankrupt.