Processing Magazine

Court rules water from gas drilling must be regulated

April 22, 2009
The Associated Press reports that, energy companies drilling natural gas from underground coal seams must obtain water well permits or replace the water they use if other water supplies are affected in a Colorado Supreme Court recent ruling. Groundwater pumped out during coal-bed methane drilling is not just a waste product, the court said, ruling on a lawsuit by landowners who say their water supplies are threatened by companies using groundwater to free natural gas in coal seams. The decision means companies must defer to water users with older water rights and replace the water they use when it belongs to others. The ruling affects tributary water, which is connected to rivers and streams. Pumping groundwater relieves pressure that traps methane gas in coal seams. Other gas drilling might produce water, but not in the volumes that coal-bed methane extraction does. Millions of gallons of water might be pumped over the life of one well. There are about 38,000 active oil and gas wells statewide, and roughly 5,000 of those are coal-bed methane. The state engineer''s office and BP America Production Co. argued that water is a byproduct of drilling and should be regulated by state oil and gas rules. BP America re-injects the water it uses into the ground. But the Supreme Court upheld a state water court ruling that the water is put to beneficial use and is subject to state water laws. The justices said the pumping the groundwater is an integral part of extracting the gas, so the water isn''t "merely a nuisance." The Colorado Oil and Gas Association, a trade group, said in a statement that coal-bed methane drilling hasn''t been shown to harm water-rights owners. The group argues that new oil and gas regulations are driving companies out of Colorado or forcing them to cut back production and investment. Legislation negotiated by parties in the lawsuit would give energy companies a year to apply for water well permits and to submit water-replacement plans. The bill, now in the Colorado Senate, would also allow the state engineer''s office to come up with a way to determine which oil and gas wells across the state tap into tributary water. State water laws would apply to those.