Occidental Petroleum won approval Wednesday from Colorado regulators for a large-scale oil and gas well development it plans on 34 square miles of rural Weld County.
Commissioners for the Colorado Oil & Gas Conservation Commission unanimously approved the Houston-based company’s plan after seeing revisions they’d asked for on Aug. 4 that more clearly committed Occidental to mitigate some of the environmental and wildlife impacts of the project to drill as many as 209 new wells on a remote cattle ranch outside the town of Roggen.
“I think this is the right direction for this applicant and for the state of Colorado,” said Jeff Robbins, COGCC chairman, after the vote.
The application, submitted by an Occidental subsidiary called Kerr-McGee Oil & Gas Onshore, was the first large-scale “comprehensive area plan” approved by the COGCC since it tightened its rules to prioritize public health, safety, wildlife resources and the environment in early 2021.
Winning approval gives Occidental exclusive right to develop oil and gas wells across the remote 24,331-acre property over six years, a timeline it says will allow construction of pipelines and electricity infrastructure that enable the company to avoid using onside storage tanks and natural gas-powered equipment on the 11 well sites it plans.
Occidental has said that the project, known as its Bronco comprehensive area plan, is considered one of its highest priorities internationally.
The plan consolidates the company’s facilities and infrastructure needed to produce oil and gas on the ranch, and the company is pleased to have won COGCC approval, said Jennifer Brice, an Occidental spokeswoman.
“It applies consistent health, safety, environmental and operational standards while reducing traffic impacts, emissions, and our surface footprint,” she said. “The next step includes submitting our Oil and Gas Development Plan for operating permits.”
The company will build pipelines and power infrastructure within an existing power line right-of-way and road that runs through the ranch. That’s expected to minimize surface impacts of the project, something Occidental has been working on with the ranch’s owner, Cervi Enterprises, a family-owned cattle ranching business.
Occidental hasn’t disclosed its expected budget for the Bronco project.
Based on typical per-well drilling costs in the Denver-Julesburg Basin, it’s expected to easily surpass $1 billion of investment by the company over several years.
The company earlier this year was stung by the COGCC rejection of a much smaller drilling project it proposed. But that application was for drilling sites within 2,000 feet of some homes within the town of Firestone in Weld County.
The Bronco area plan encompasses a ranch with one residence that would be more than a mile from the nearest new well, and the ranch owner supports the drilling project.
COGCC commissioners last week sought more clarity on Occidental’s plan, and on Wednesday they received enough to approve it quickly.The company amended the plan to commit to piping all contaminated water its wells produce on the ranch away to be treated and to not truck any of it, a promise the company estimates will eliminate the need for 1 million truck trips to the ranch over 35 years.
Occidental also clarified its plan to reflect that area utilities don’t have adequate electrical power near the ranch to power electric drilling rigs, and the power companies won’t be able to provide that in the foreseeable future.
Electric drilling rigs eliminate most on-site air emissions during well drilling. Without enough electrical power for rigs, Occidental promised to use natural gas-powered rigs to drill its wells instead of diesel-powered rigs that emit more pollution.
The company also committed to having a plan to mitigate impacts to wildlife across the ranch, which includes areas the state considers high-priority habitat as wintering range for pronghorn antelope.
Occidental pledged to develop a broad plan and receive approval for it from the Colorado Parks and Wildlife division before the first oil well site development application for the ranch is submitted to the COGCC.
The company expects that first application to come in about six months and then the company will steadily pursue associated drilling permits and applications for other well sites on the ranch in the months and years after that.Having a comprehensive area plan approved means the company will not have to provide data about the cumulative impacts with each well site, since that’s already been done. Each specific well site plan on the ranch will receive an expedited review from the COGCC because it’s part of an approved comprehensive area plan.