In a unanimous decision which resolved more than five years of dispute, the Colorado Supreme Court on January 14, 2019 upheld the decision of the Colorado Oil and Gas Commission (COGCC) which had refused to engage in rulemaking proposed by environmental groups. Led by the so-called teenage activist Xiuhtezcatl (pronounced Shoe-Tez-Caht) Martinez, the activists proposed a rule that would have conditioned all new oil and gas development on a finding of no cumulative adverse impacts to public health and the environment. Responding to the rulemaking petition which was originally submitted in 2013, the COGCC said the rulemaking was beyond its statutory authority; on appeal, the district court agreed with the agency; and then the Court of Appeals, in a split decision, reversed.
Referring to the proponents of the rulemaking as “youth activists,” Justice Gabriel reversed the Court of Appeals and wrote that the COGCC properly recognized that its statutory authority did not allow it to issue such a rule. Rather, the Court ruled that the Commission’s organic statute requires a balancing process and makes clear that the Commission is required to:
- foster the development of oil and gas resources, protecting and enforcing the rights of owners and producers; and
- in doing so, to prevent and mitigate significant adverse environmental impacts to the extent necessary to protect public health, safety, and welfare; but
- only after taking into consideration cost-effectiveness and technical feasibility.
Recognizing that courts “owe deference” to agency decisions, Justice Gabriel concluded, in part:
Specifically, …, we do not believe that the pertinent provisions of the Act allow the Commission to condition one legislative priority (here, oil and gas development) on another (here, the protection of public health and the environment).
The Court’s ruling will remove a potential across-the-board impediment to additional oil and gas development in Colorado. We expect the environmental groups will continue to seek redress in the Colorado legislature and to oppose future projects on an individual basis.
COGCC v. Martinez. Case No. 2019 CO 3.
Link to opinion: https://www.courts.state.co.us/userfiles/file/Court_Probation/Supreme_Court/Opinions/2017/17SC297.pdf
This post was drafted by John Watson, an attorney in the Denver, CO office of Spencer Fane LLP. For more information, visit spencerfane.com.