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Colorado SC says commission did not abuse discretion when it declined engaging rule regarding permits

By Gabriel Neves | Jan 23, 2019

DENVER (Legal Newsline) – The Colorado Supreme Court has ruled that the state commission that oversees oil and gas resources that declined to engage in rulemaking regarding new permits for oil and gas drilling in the state properly declined to do so.

Justice Richard Gabriel issued a 31-page ruling on Jan. 14 that reversed a state Court of Appeals decision in the petition filed by Colorado Oil and Gas Conservation Commission, American Petroleum Institute and Colorado Petroleum Association against respondents Xiuhtezcatl Martinez, Itzcuahtli Roske-Martinez, Sonora Brinkley, et al.

The court reversed the lower court ruling, considering that the commission "properly declined" in engaging in the rule proposed by the respondent people and organizations.

As stated in the ruling, the proposed rule from the respondents "would have precluded the commission from issuing any permits for the drilling of an oil and gas well 'unless the best available science demonstrates, and an independent, third-party organization confirms, that drilling can occur in a manner that does not cumulatively, with other actions, impair Colorado’s atmosphere, water, wildlife, and land resources, does not adversely impact human health, and does not contribute to climate change.'”

After public comments and hearings, per the ruling, "the commission declined to engage in rulemaking to consider this proposed rule because, among other things, (1) the rule would have required the Commission to readjust the balance purportedly crafted by the General Assembly under the Act and conditioned new oil and gas drilling on a finding of no cumulative adverse impacts, both of which the Commission believed to be beyond its statutory authority, and (2) the Commission was already working with the Colorado Department of Public Health and Environment (CDPHE) to address the concerns to which the rule was directed and other Commission priorities took precedence over the proposed rulemaking at this time."

A district court in Denver upheld the decision, but the Court of Appeals reversed it.

In his ruling, Gabriel stated that "because the commission’s decision to decline to engage in rulemaking to consider respondents’ proposed rule was consistent with the applicable provisions of the (Colorado Oil and Gas Conservation) Act and with the commission’s authority to decide how best to marshal its resources to carry out its statutory duties, we perceive no abuse of discretion in that decision."

Colorado Supreme Court case number 17SC297

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