Second Regular Session
Seventy-fourth General Assembly
STATE OF COLORADO
REENGROSSED
This Version Includes All Amendments
Adopted in the House of Introduction
LLS NO. 24-0904.01 Sarah Lozano x3858
HOUSE BILL 24-1346
House Committees Senate Committees
Energy & Environment
A BILL FOR AN ACT
C
ONCERNING ENERGY AND CARBON MANAGEMENT REGULATION IN101
C
OLORADO, AND, IN CONNECTION THEREWITH , BROADENING102
THE ENERGY AND CARBON MANAGEMENT COMMISSION 'S103
REGULATORY AUTHORITY TO I NCLUDE REGULATION OF
104
GEOLOGIC STORAGE OPERATIONS .105
Bill Summary
(Note: This summary applies to this bill as introduced and does
not reflect any amendments that may be subsequently adopted. If this bill
passes third reading in the house of introduction, a bill summary that
applies to the reengrossed version of this bill will be available at
http://leg.colorado.gov
.)
The bill expands the authority of the energy and carbon
management commission (commission) to include the regulation of:
HOUSE
3rd Reading Unamended
April 17, 2024
HOUSE
Amended 2nd Reading
April 16, 2024
HOUSE SPONSORSHIP
Titone and McCormick, Bacon, Bird, Boesenecker, Herod, Jodeh, Kipp, Lindsay, Mabrey,
Parenti, Rutinel, Willford
SENATE SPONSORSHIP
Hansen and Priola,
Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.
Capital letters or bold & italic numbers indicate new material to be added to existing law.
Dashes through the words or numbers indicate deletions from existing law. ! Facilities that use equipment to capture a significant
quantity of carbon dioxide directly from the ambient air
(direct air capture facility); and
! Activities performed for the purpose of engaging in the
injection and underground sequestration of carbon dioxide
in pore space (geologic storage operations).
The commission may:
! Reimpose any regulatory responsibility or financial
assurance obligation imposed on a person that exercises the
right to control the conduct of geologic storage operations
(geologic storage operator) if the geologic storage operator
makes a material misrepresentation or omission that causes
the commission to approve a site closure; and
! Assess and collect regulatory and permitting fees from
geologic storage operators.
The bill also allows the commission to hire and designate
employees of the commission as administrative law judges who have the
authority to administer proceedings on behalf of the commission.
Current law provides a statute of limitations of one year after the
date of an alleged violation of energy and carbon management laws
(violation). The bill changes this statute of limitations to 3 years after the
discovery of the alleged violation and provides that the 3-year statute of
limitations period does not apply if information regarding the alleged
violation is knowingly or willfully concealed by the alleged violator.
The bill also expands the following energy and carbon
management law areas to include geologic storage operations and direct
air capture facilities:
! Enforcement and civil penalty procedures;
! Use of the energy and carbon management cash fund by the
commission;
! Mitigation of adverse environmental impacts by the
commission or an operator; and
! State agency and local government authority over oil and
gas development.
The commission is required to adopt rules related to the permitting
and regulation of direct air capture facilities. When reviewing an
application for a direct air capture facility, the commission must consider
whether a setback of the direct air capture facility from certain areas is
necessary and reasonable to protect and minimize adverse impacts to
public health, safety, and welfare; the environment; and wildlife
resources. The commission may assess and collect permitting and
regulatory fees from the operators of direct air capture facilities.
The bill also establishes that:
! Ownership of a portion of a pore space necessary for
geologic storage (sequestration estate) is vested in the
1346
-2- owner of the overlying surface estate if the sequestration
estate has not been separately severed, conveyed, or
reserved;
! Any conveyance of the ownership of an overlying surface
estate also conveys the grantor's ownership of any
sequestration estate except in certain circumstances; and
! A conveyance of the ownership of a mineral estate does not
convey the grantor's ownership in the sequestration estate
unless the conveyance instrument provides for the
conveyance.
Upon application of any interested person, the commission must
hold a hearing and enter an order (order) providing for the formation of
a unit of one or more geologic storage resources (geologic storage unit)
if the commission finds that the geologic storage unit is reasonably
necessary to effectuate a geologic storage project. The order must include
terms and conditions that are just and reasonable and establish a plan for
operations of the geologic storage unit (plan). An order is effective only
if the plan has been approved by those persons that collectively own at
least 75% of the geologic storage resources included in the geologic
storage unit area (required approval) and the commission makes a finding
in the order of the required approval.
The bill also allows a local government to request that the director
of the commission appoint a technical review board to assist a local
government in analyzing and answering any technical questions regarding
the local government's land use regulations.
The bill also requires the department of public health and
environment (department) to develop carbon dioxide accounting
procedures for geologic storage operations and direct air capture
facilities. The commission must compile relevant data to support the
carbon dioxide accounting procedures and work collaboratively with the
department in implementing the carbon dioxide accounting procedures.
The commission and the department must also work collaboratively to
address air emissions from direct air capture facilities and geologic
storage operations.
Be it enacted by the General Assembly of the State of Colorado:1
SECTION 1. In Colorado Revised Statutes, 34-60-102, add (3)2
as follows:3
34-60-102. Legislative declaration. (3) I
T IS FURTHER DECLARED 4
TO BE IN THE PUBLIC INTEREST FOR THE COMMISSION TO IMPLEMENT5
1346-3- AND ADMINISTER A PROGRAM FOR THE PERMITTING AND REGULATION OF1
PERMANENT GEOLOGIC STORAGE OPERATIONS IN A WAY THAT PRIORITIZES :2
(a) CONTRIBUTIONS TOWARD ACHIEVING THE STATE 'S3
GREENHOUSE GAS EMISSION REDUCTION GOALS, AS SET FORTH IN SECTION4
25-7-102 (2)(g);5
(b) BENEFITS TO THE STATE AND GLOBAL ENVIRONMENT BY6
REDUCING CARBON DIOXIDE POLLUTION ;7
(c) OPPORTUNITIES TO SUPPORT A JUST TRANSITION AND TO HELP8
RETRAIN WORKERS, PARTICULARLY WORKERS PREVIOUSLY EMPLOYED IN9
THE FOSSIL FUEL INDUSTRY;10
(d) PROTECTING DISPROPORTIONATELY IMPACTED COMMUNITIES11
AND ADVANCING ENVIRONMENTAL JUSTICE ; AND12
(e) THE SAFE AND RESPONSIBLE USE OF COLORADO'S ABUNDANT13
NATURAL RESOURCES FOR THE PERMANENT STORAGE OF CARBON DIOXIDE .14
SECTION 2. In Colorado Revised Statutes, amend 34-60-103 as15
follows:16
34-60-103. Definitions - rules. As used in this article 60, unless17
the context otherwise requires:18
(1) "And" includes the word "or" and the use of the word "or"19
includes the word "and". The use of the plural includes the singular and20
the use of the singular includes the plural.21
22
(2) (a) "CARBON DIOXIDE FLOW LINE" MEANS A SEGMENT OF PIPE23
TRANSFERRING INJECTION CARBON DIOXIDE BETWEEN THE WELLHEAD OF24
A CLASS VI INJECTION WELL AND A PIPELINE REGULATED BY THE PIPELINE25
AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION OF THE UNITED26
S
TATES DEPARTMENT OF TRANSPORTATION OR THE PUBLIC UTILITIES27
1346
-4- COMMISSION.1
(b) "C
ARBON DIOXIDE FLOW LINE" DOES NOT INCLUDE PIPELINES2
REGULATED BY THE PIPELINE AND HAZARDOUS MATERIALS SAFETY3
ADMINISTRATION OF THE UNITED STATES DEPARTMENT OF4
TRANSPORTATION OR THE PUBLIC UTILITIES COMMISSION .5 (3) "CLASS VI INJECTION WELL" MEANS A WELL DRILLED6
PURSUANT TO A PERMIT FOR A CLASS VI INJECTION WELL ISSUED UNDER7
THE FEDERAL "SAFE DRINKING WATER ACT", 42 U.S.C. SEC. 300f ET SEQ.,8
AS AMENDED.9
(2) (4) "Commission" means the energy and carbon management10
commission created in section 34-60-104.3 (1).11
(3) (5) "Common source of supply" is synonymous with "pool" as12
defined in this section.13
(4) (6) (a) "Correlative rights" means that each owner and14
producer in a common pool or source of supply of oil and gas shall MUST15
have an equal opportunity to obtain and produce his THE OWNER'S OR16
PRODUCER'S just and equitable share of the oil and gas underlying such17
THE pool or source of supply.18
(b) A
S USED IN SECTION
34-60-141, "CORRELATIVE RIGHTS" MEANS19
THAT EACH OWNER OF A SEQUESTRATION ESTATE MUST HAVE AN EQUAL20
OPPORTUNITY TO UTILIZE THE OWNER 'S JUST AND EQUITABLE SHARE OF21
THE UNDERLYING GEOLOGIC STORAGE RESOURCE .22
(7) (a) "CUMULATIVE IMPACTS" MEANS THE EFFECTS ON PUBLIC23
HEALTH AND THE ENVIRONMENT , INCLUDING THE IMPACTS TO AIR24
QUALITY, WATER QUALITY, CLIMATE, NOISE, ODOR, WILDLIFE, AND25
BIOLOGICAL RESOURCES, CAUSED BY THE INCREMENTAL IMPACTS THAT A26
PROPOSED NEW OR AMENDED OPERATION REGULATED BY THE COMMISSION27
1346
-5- PURSUANT TO THIS ARTICLE 60 WOULD HAVE WHEN ADDED TO THE1
IMPACTS FROM OTHER PAST, PRESENT, AND REASONABLY FORESEEABLE2
FUTURE DEVELOPMENT OF ANY TYPE ON THE IMPACT AREA OR ON A3
DISPROPORTIONATELY IMPACTED COMMUNITY .4
(b) "CUMULATIVE IMPACTS" MAY INCLUDE BOTH ADVERSE AND5
BENEFICIAL ENVIRONMENTAL IMPACTS .6
(c) THIS SUBSECTION (7) IS EFFECTIVE ON THE EFFECTIVE DATE OF7
THE RULES ADOPTED PURSUANT TO SECTION 34-60-106 (11)(d)(I).8
9
(8) "DISPROPORTIONATELY IMPACTED COMMUNITY " HAS THE10
MEANING SET FORTH IN SECTION 24-4-109 (2)(b)(II).11
(4.3) (9) "Division of parks and wildlife" means the division of12
parks and wildlife identified in article 9 of title 33. C.R.S.13
(10) "ENERGY AND CARBON MANAGEMENT OPERATIONS " MEANS14
ALL OPERATIONS REGULATED BY THE COMMISSION .15
(11) "ENERGY AND CARBON MANAGEMENT OPERATOR " MEANS16
ANY PERSON THAT EXERCISES THE RIGHT TO CONTROL THE CONDUCT OF17
ENERGY AND CARBON MANAGEMENT OPERATIONS .18
(4.5) (12) "Exploration and production waste" means those wastes19
that are generated during the drilling of and production from oil and gas20
wells; during the drilling of and production from wells for deep21
geothermal operations, as defined in section 37-90.5-103 (3), regulated22
by the commission pursuant to article 90.5 of title 37; or during primary23
field operations and that are exempt from regulation as hazardous wastes24
under Subtitle C of the federal "Resource Conservation and Recovery Act25
of 1976", 42 U.S.C. secs. 6901 to 6934, as amended.26
(5) (13) "Gas" means all natural gases and all hydrocarbons not27
1346
-6- defined in this section as oil.1
(14) "GEOLOGIC STORAGE" MEANS THE INJECTION AND2
UNDERGROUND SEQUESTRATION OF INJECTION CARBON DIOXIDE IN A3
GEOLOGIC STORAGE RESOURCE PURSUANT TO A VALID CLASS VI PERMIT4
ISSUED PURSUANT TO THE FEDERAL "SAFE DRINKING WATER ACT", 425
U.S.C.
SEC. 300f ET SEQ., AS AMENDED.6 (15) (a) "GEOLOGIC STORAGE FACILITY" MEANS THE SPECIFIC PART7
OF A GEOLOGIC STORAGE RESOURCE THAT IS UTILIZED FOR GEOLOGIC8
STORAGE, TOGETHER WITH THE WELL OR WELLS AND ALL SURFACE9
EQUIPMENT AND DISTURBANCES ASSOCIATED WITH THE GEOLOGIC10
STORAGE OPERATIONS AT THE GEOLOGIC STORAGE LOCATION .11
(b) "GEOLOGIC STORAGE FACILITY" DOES NOT INCLUDE PIPELINES12
REGULATED BY THE PIPELINE AND HAZARDOUS MATERIALS SAFETY13
ADMINISTRATION OF THE UNITED STATES DEPARTMENT OF14
TRANSPORTATION OR THE PUBLIC UTILITIES COMMISSION .15
(16) "GEOLOGIC STORAGE LOCATION" MEANS A DEFINABLE AREA16
WHERE A GEOLOGIC STORAGE OPERATOR USES OR INTENDS TO USE THE17
SURFACE OF THE LAND IN ORDER TO OPERATE A GEOLOGIC STORAGE18
FACILITY.19
(17) "GEOLOGIC STORAGE OPERATIONS " MEANS ACTIVITIES20
PERFORMED FOR THE PURPOSE OF ENGAGING IN GEOLOGIC STORAGE IN THE21
STATE, INCLUDING:22
(a) T
HE FOLLOWING ACTIVITIES RELATED TO THE OPERATION OF A23
GEOLOGIC STORAGE FACILITY:24
(I) D
RILLING TEST BORES AND MONITORING WELLS ;25
(II) S
ITING;26
(III) I
NSTALLING AND OPERATING CARBON DIOXIDE FLOW LINES ;27
1346
-7- (IV) DRILLING;1
(V) D
EEPENING;2
(VI) R
ECOMPLETING;3
(VII) R
EWORKING; AND4
(VIII) A
BANDONING;5
(b) I
NJECTING
INJECTION CARBON DIOXIDE FOR THE PURPOSE OF6
GEOLOGIC STORAGE;7
(c) A
NY CONSTRUCTING, SITE PREPARING, OR RECLAIMING8
ACTIVITIES ASSOCIATED WITH THE ACTIVITIES DESCRIBED IN SUBSECTION9 (17)(a) OR (17)(b) OF THIS SECTION; AND10
(d) A
NY OTHER ACTIVITIES DETERMINED BY THE COMMISSION TO11
BE NECESSARY TO PROTECT AND MINIMIZE ADVERSE IMPACTS ASSOCIATED12
WITH GEOLOGIC STORAGE TO PUBLIC HEALTH , SAFETY, WELFARE, THE13
ENVIRONMENT, AND NATURAL RESOURCES.14(18) "GEOLOGIC STORAGE OPERATOR " MEANS ANY PERSON THAT15
EXERCISES THE RIGHT TO CONTROL THE CONDUCT OF GEOLOGIC STORAGE16
OPERATIONS.17
(19) (a) "GEOLOGIC STORAGE RESOURCE " MEANS PORE SPACE18
NECESSARY FOR GEOLOGIC STORAGE .19
(b) "G
EOLOGIC STORAGE RESOURCE " DOES NOT INCLUDE AN20
UNDERGROUND SOURCE OF DRINKING WATER , AS DEFINED IN 40 CFR21
144.3.22 (20) "GEOLOGIC STORAGE UNIT" MEANS A UNIT OF ONE OR MORE23
GEOLOGIC STORAGE RESOURCES OR PARTS OF A GEOLOGIC STORAGE24
RESOURCE ESTABLISHED BY THE COMMISSION PURSUANT TO SECTION25
34-60-141.26
(21) "GEOLOGIC STORAGE UNIT AREA " MEANS ANY GEOLOGIC27
1346
-8- STORAGE RESOURCE, OR PART OF A GEOLOGIC STORAGE RESOURCE ,1
INCLUDED IN A GEOLOGIC STORAGE UNIT .2
(22) "IMPACT AREA" MEANS A DEFINED GEOGRAPHIC AREA OR3
AREAS IN WHICH OPERATIONS REGULATED BY THE COMMISSION HAVE THE4
POTENTIAL TO CONTRIBUTE TO CUMULATIVE IMPACTS . THE COMMISSION5
SHALL DETERMINE THE IMPACT AREA FOR A PARTICULAR PROPOSED6
OPERATION BASED ON THE NATURE, INTENSITY, AND SCOPE OF THE7
OPERATION IN ITS PROPOSED LOCATION AND THE GEOGRAPHIC EXTENT OF8
POTENTIAL IMPACTS.9
(23) "IMPACTS TO CLIMATE" MEANS THE QUANTIFICATION OF10
EMISSIONS OF GREENHOUSE GASES, AS DEFINED IN SECTION 25-7-140 (6),11
THAT OCCUR FROM SOURCES THAT ARE CONTROLLED OR OWNED BY THE12
ENERGY AND CARBON MANAGEMENT OPERATOR AND FROM REASONABLY13
FORESEEABLE TRUCK TRAFFIC, AS WELL AS REDUCTIONS IN GREENHOUSE14
GAS EMISSIONS, ASSOCIATED WITH THE PROPOSED OPERATION .15
(24) "INJECTION CARBON DIOXIDE" MEANS CARBON DIOXIDE,16
INCLUDING ITS DERIVATIVES AND ALL MIXTURES, COMBINATIONS, AND17
PHASES, WHETHER LIQUID, GASEOUS, SUPER-CRITICAL, OR SOLID, AND18
WHETHER STRIPPED, SEGREGATED, OR DIVIDED FROM ANY OTHER FLUID19
STREAM, INCLUDING ALL INCIDENTAL ASSOCIATED SUBSTANCES DERIVED20
FROM THE SOURCE MATERIALS .21
(5.3) (25) "Local government" means except with regard to22
section 34-60-104 (2)(a)(I), a:23
24
(a) Municipality or city and county within whose boundaries an25
oil and gas location A SURFACE LOCATION FOR ENERGY AND CARBON26
MANAGEMENT OPERATIONS is sited or proposed to be sited; or27
1346
-9- (b) County, if an oil and gas location A SURFACE LOCATION FOR1
ENERGY AND CARBON MANAGEMENT OPERATIONS is sited or proposed to2
be sited within the boundaries of the county but is not located within a3
municipality or city and county.4
(5.5) (26) "Minimize adverse impacts" means, to the extent5
necessary and reasonable to protect public health, safety, and welfare; the6
environment; and wildlife resources, to:7
(a) Avoid adverse impacts from oil and gas ENERGY AND CARBON8
MANAGEMENT operations; and9
(b) Minimize and mitigate the extent and severity of those impacts10
that cannot be avoided.11
(6) (27) "Oil" means crude petroleum oil and any other12
hydrocarbons, regardless of gravities, which THAT are produced at the13
well in liquid form by ordinary production methods and which THAT are14
not the result of condensation of gas before or after it leaves the reservoir.15
(6.2) (28) "Oil and gas facility" means equipment or16
improvements used or installed at an oil and gas location for the17
exploration, production, withdrawal, treatment, or processing of crude oil,18
condensate, exploration and production waste, or gas.19
(6.4) (29) "Oil and gas location" means a definable area where an20
oil and gas operator has disturbed or intends to disturb the land surface in21
order to locate an oil and gas facility.22
(6.5) (30) "Oil and gas operations" means exploration for oil and23
gas, including:24
(a) The conduct of seismic operations and the drilling of test25
bores;26
(b) The siting, drilling, deepening, recompletion, reworking, or27
1346
-10- abandonment of an oil and gas well, underground injection well, or gas1
storage well;2
(c) Production operations related to any such well DESCRIBED IN3
SUBSECTION (30)(b) OF THIS SECTION, including the installation of flow4
lines and gathering systems;5
(d) The generation, transportation, storage, treatment, or disposal6
of exploration and production wastes; and7
(e) Any construction, site preparation, or reclamation activities8
associated with such THE operations DESCRIBED IN THIS SUBSECTION (30).9
(6.8) (31) "Operator" means any person who THAT exercises the10
right to control the conduct of oil and gas operations.11
(7) (32) "Owner" means the person who THAT has the right to drill12
into and produce from a pool and to appropriate the oil or gas he THE13
PERSON produces therefrom FROM THE POOL either for himself THE14
PERSON or others or for himself THE PERSON and others, including the15
owner of a well capable of producing oil or gas, or both.16
(7.1) (33) "Parks and wildlife commission" means the parks and17
wildlife commission created in section 33-9-101. C.R.S.18
(7.5) (34) "Permit" means any permit, sundry notice, notice of19
intention, or other approval, including any conditions of approval, which20
THAT is granted, issued, or approved by the commission.21
(8) (35) "Person" means any natural person, corporation,22
association, partnership, receiver, trustee, executor, administrator,23
guardian, fiduciary, or other representative of any kind and includes any24
department, agency, or instrumentality of the state or any governmental25
subdivision thereof OF THE DEPARTMENT, AGENCY, OR INSTRUMENTALITY26
OF THE STATE.27
1346
-11- (9) (36) "Pool" means an underground reservoir containing a1
common accumulation of oil or gas, or both. Each zone of a general2
structure, which zone is completely separated from any other zone in the3
structure, is covered by the word "pool" as used in this article ARTICLE 60.4
(37) "PORE SPACE" MEANS A CAVITY OR VOID, WHETHER NATURAL5
OR ARTIFICIALLY CREATED, IN A SUBSURFACE STRATUM.6
(10) (38) "Producer" means the owner of a well capable of7
producing oil or gas, or both.8
(39) "REASONABLY FORESEEABLE FUTURE DEVELOPMENT" MEANS9
DEVELOPMENT THAT HAS NOT YET BEEN UNDERTAKEN FOR WHICH AN10
APPLICABLE LOCAL, STATE, OR FEDERAL AGENCY HAS RECEIVED AN11
APPLICATION OR ISSUED A PERMIT. FUTURE DEVELOPMENT IS REASONABLY12
FORESEEABLE ONLY IF INFORMATION RELATED TO THE PERMIT IS PUBLICLY13
AVAILABLE.14
(40) "SEQUESTRATION ESTATE" MEANS A PORTION OF A GEOLOGIC15
STORAGE RESOURCE.16
(10.5) (41) "Surface owner" means any person owning all or part17
of the surface of land upon which oil and gas ENERGY AND CARBON18
MANAGEMENT operations are conducted, as shown by the tax records of19
the county in which the tract of land is situated, or any person with such20
rights under a recorded contract to purchase.21
(10.7) (42) "Underground natural gas storage cavern" means a22
facility that stored natural gas in an underground cavern or abandoned23
mine on or before January 1, 2000. An underground natural gas storage24
cavern includes all surface or subsurface rights and appurtenances25
associated with the underground injection, storage, and withdrawal of26
natural gas, but does not include any compressor stations or pipeline27
1346
-12- facilities subject to regulation by the public utilities commission or the1
United States department of transportation.2
(11) (43) "Waste", as applied to gas:3
(a) Includes the escape, blowing, or releasing, directly or4
indirectly into the open air, of gas from wells productive of gas only, or5
gas in an excessive or unreasonable amount from wells producing oil or6
both oil and gas; and the production of gas in quantities or in such manner7
as unreasonably reduces reservoir pressure or, subject to subsection8
(11)(b) (43)(b) of this section, unreasonably diminishes the quantity of oil9
or gas that ultimately may be produced; excepting gas that is reasonably10
necessary in the drilling, completing, testing, and in furnishing power for11
the production of wells; and12
(b) Does not include the nonproduction of gas from a formation13
if necessary to protect public health, safety, and welfare; the environment;14
or wildlife resources as determined by the commission.15
(12) (44) "Waste", as applied to oil:16
(a) Includes underground waste; inefficient, excessive, or17
improper use or dissipation of reservoir energy, including gas energy and18
water drive; surface waste; open-pit storage; and waste incident to the19
production of oil in excess of the producer's aboveground storage20
facilities and lease and contractual requirements, but excluding storage,21
other than open-pit storage, reasonably necessary for building up or22
maintaining crude stocks and products of crude stocks for consumption,23
use, and sale; and24
(b) Does not include the nonproduction of oil from a formation if25
necessary to protect public health, safety, and welfare; the environment;26
or wildlife resources as determined by the commission.27
1346
-13- (13) (45) "Waste", in addition to the meanings as set forth in1
subsections (11) (43) and (12) (44) of this section:2
(a) Means, subject to subsection (13)(b) (45)(b) of this section:3
(I) Physical waste, as that term is generally understood in the oil4
and gas industry;5
(II) The locating, spacing, drilling, equipping, operating, or6
producing of any oil or gas well or wells in a manner that causes or tends7
to cause reduction in quantity of oil or gas ultimately recoverable from a8
pool under prudent and proper operations or that causes or tends to cause9
unnecessary or excessive surface loss or destruction of oil or gas; and10
(III) Abuse of the correlative rights of any owner in a pool due to11
nonuniform, disproportionate, unratable, or excessive withdrawals of oil12
or gas from the pool, causing reasonably avoidable drainage between13
tracts of land or resulting in one or more producers or owners in the pool14
producing more than an equitable share of the oil or gas from the pool;15
and16
(b) Does not include the nonproduction of oil or gas from a17
formation if necessary to protect public health, safety, and welfare; the18
environment; or wildlife resources as determined by the commission.19
(14) Repealed.20
(15) (46) "Wildlife resources" means fish, wildlife, and their21
aquatic and terrestrial habitats.22
SECTION 3. In Colorado Revised Statutes, 34-60-105, amend23
(1)(b) introductory portion and (1)(b)(V) as follows:24
34-60-105. Powers of commission. (1) (b) Any delegation of25
authority to any other state officer, board, or commission to administer26
any other laws of this state relating to the conservation of oil or gas, or27
1346
-14- either of them, is hereby rescinded and withdrawn, and that authority is1
unqualifiedly conferred upon the commission, as provided in this section;2
except that, as further specified in section 34-60-131, nothing in this3
article 60 alters, impairs, or negates the authority of:4
(V) A local government to regulate oil and gas ENERGY AND5
CARBON MANAGEMENT operations pursuant to section 29-20-104.6
SECTION 4. In Colorado Revised Statutes, 34-60-106, amend7
(9)(c)(II), (9)(c)(III)(A), (9)(c)(III)(B), (9)(c)(IV)(A), (9)(c)(IV)(C),8
(9)(c)(IV)(D), (9)(d) introductory portion, (9)(d)(I), (9)(d)(II), (9)(d)(III),9
and (11)(d)(I); repeal (9)(c)(III)(C), (9)(e)(III), (11)(d)(III), and10
(11)(d)(IV); and add (9)(c)(IV)(D.5) and (9)(d.5) as follows:11
34-60-106. Additional powers of commission - fees - rules -12
definitions - repeal. (9) (c) (II) The commission may issue and enforce13
permits as necessary for the purpose set forth in this subsection (9)(c) FOR14
GEOLOGIC STORAGE OPERATIONS AND MAY REGULATE GEOLOGIC STORAGE15
OPERATIONS after the commission makes the determination and holds the16
hearing set forth in subsection (9)(c)(I) of this section and the commission17
and the governor satisfy the requirements set forth in subsection (9)(a) of18
this section.19
(III) (A) If the class VI injection well A GEOLOGIC STORAGE20
LOCATION is proposed to be sited in an area that would affect a21
disproportionately impacted community, the commission shall weigh the22
geologic storage operator's submitted cumulative impacts analysis and23
determine whether, on balance, the class VI injection well GEOLOGIC24
STORAGE OPERATIONS will have a positive effect on the disproportionately25
impacted community. A proposal that will have negative net cumulative26
impacts on any disproportionately impacted community must be denied.27
1346
-15- The commission's decision must include a plain language summary of its1
determination.2
(B) The commission may amend by rule the cumulative effects3
IMPACTS analysis and requirements set forth in this subsection (9)(c)(III)4
if the commission finds the analysis and requirements to be inconsistent5
with, or incomplete with respect to, the federal environmental protection6
agency's requirements for class VI primacy.7
(C) As used in this subsection (9)(c)(III), "cumulative impacts"8
means the effect on public health and the environment, including the9
effect on air quality, water quality, the climate, noise, odor, wildlife, and10
biological resources, caused by the incremental impact that a proposed11
new or modified class VI injection well would have when added to the12
impacts from other past, present, and reasonably foreseeable future13
development of any type on the affected area, including an airshed or14
watershed, or on a disproportionately impacted community.15
(IV) (A) The commission shall require each operator of a class VI16
injection well GEOLOGIC STORAGE OPERATOR to provide adequate17
financial assurance demonstrating that the
GEOLOGIC STORAGE operator18
is financially capable of fulfilling every obligation imposed on the19
operator under this article 60 and under rules that the commission adopts20
pursuant to this article 60.21
(C) The commission shall adopt rules requiring that the financial22
assurance cover the cost of obligations that are in addition to the23
obligations listed in subsection (9)(c)(IV)(B) of this section if the24
additional obligations are reasonably associated with
class VI injection25
wells and locations GEOLOGIC STORAGE OPERATIONS .26
(D) An operator A GEOLOGIC STORAGE OPERATOR shall maintain27
1346
-16- the financial assurance required under this subsection (9)(c)(IV) or under1
any rules adopted pursuant to this subsection (9)(c)(IV) until the2
commission approves site closure, as specified in rules adopted by the3
commission. Commission approval of a site closure does not otherwise4
modify an operator's responsibility to comply with applicable laws.5
(D.5) I
F A GEOLOGIC STORAGE OPERATOR MAKES A MATERIAL6
MISREPRESENTATION OR OMISSION THAT CAUSES THE COMMISSION TO7
APPROVE A SITE CLOSURE PURSUANT TO SUBSECTION (9)(c)(IV)(D) OF8
THIS SECTION, THE COMMISSION MAY REIMPOSE ANY REGULATORY9
RESPONSIBILITY OR FINANCIAL ASSURANCE OBLIGATION IMPOSED ON THE10
GEOLOGIC STORAGE OPERATOR PURSUANT TO SUBSECTION (9)(c)(IV)(A)11
OF THIS SECTION.12
(d) In issuing and enforcing permits pursuant to subsection (9)(c)
13
of this section FOR GEOLOGIC STORAGE OPERATIONS , the commission shall14
ensure, after a public hearing, that:15
(I) The permitting of a class VI injection well GEOLOGIC STORAGE16
LOCATION complies with a local government's siting of the proposed class17
VI injection well GEOLOGIC STORAGE location AND THAT THE18
COMMISSION HAS CONSULTED WITH ANY LOCAL GOVERNMENT WHOSE19
BOUNDARIES INCLUDE LANDS OVERLYING THE GEOLOGIC STORAGE20
FACILITY;21
(II) The proposed new or modified class VI injection well22
GEOLOGIC STORAGE LOCATION has received an ANY applicable air permit23
PERMITS from the division of administration in the department of public24
health and environment;25
(III) The
GEOLOGIC STORAGE operator of the class VI injection
26
well has received the consent of any surface owner or owners of the land27
1346
-17- where the surface disturbance will occur and has provided the1
commission a written contractual agreement that the surface owner or2
owners have executed; and3
(d.5) (I) F
OR THE PURPOSES OF IMPLEMENTING AND4
ADMINISTERING THIS SUBSECTION (9), THE COMMISSION MAY ASSESS AND5
COLLECT REGULATORY AND PERMITTING FEES FROM GEOLOGIC STORAGE6
OPERATORS IN AN AMOUNT AND FR EQUENCY DETERMINED BY THE7
COMMISSION BY RULE.8
(II) T
HE COMMISSION SHALL TRANSFER ANY FEES ASSESSED AND9
COLLECTED PURSUANT TO SUBSECTION (9)(d.5)(I) OF THIS SECTION TO THE10
STATE TREASURER, WHO SHALL CREDIT THE FEES TO THE ENERGY AND11
CARBON MANAGEMENT CASH FUND CREATED IN SECTION 34-60-122 (5).12
(e) As used in this subsection (9), unless the context otherwise13
requires:14
(III) "Disproportionately impacted community" has the meaning
15
set forth in section 24-4-109 (2)(b)(II).16
(11) (d) (I) By April 28, 2024 SEPTEMBER 30, 2024, the17
commission shall promulgate rules that evaluate and address the18
cumulative impacts of oil and gas operations. The rules shall include a19
definition of cumulative impacts THE RULES SHALL REQUIRE EVALUATION20
OF ALL IMPACTS SET FORTH IN THE DEFINITION OF CUMULATIVE IMPACTS21
DESCRIBED IN SECTION 34-60-103. THE RULES SHALL REQUIRE22
ADDRESSING THOSE IMPACTS RESULTING FROM OPERATIONS REGULATED23
BY THE COMMISSION. WELLS DRILLED FOR THE EXCLUSIVE PURPOSE OF24
OBTAINING SUBSURFACE DATA OR INFORMATION TO SUPPORT OPERATIONS25
REGULATED BY THE COMMISSION DO NOT REQUIRE A CUMULATIVE26
IMPACTS ANALYSIS.27
1346
-18- (III) In promulgating the definition of cumulative impacts by rule1
pursuant to subsection (11)(d)(I) of this section, the commission shall2
review, consider, and include addressable impacts to climate, public3
health, the environment, air quality, water quality, noise, odor, wildlife,4
and biological resources, and to disproportionately impacted5
communities, as defined in section 24-4-109 (2)(b)(II).6
(IV) As used in this subsection (11)(d), "impacts to climate"7
means quantification of emissions of greenhouse gases, as defined in8
section 25-7-140 (6), that occur from sources that are controlled or owned9
by the operator and reasonably foreseeable truck traffic at an oil and gas10
location.11
12
SECTION 5. In Colorado Revised Statutes, 34-60-108, add (10)13
as follows:14
34-60-108. Rules - hearings - process. (10) T
HE DIRECTOR OF15
THE COMMISSION MAY HIRE AND DESIGNATE EMPLOYEES OF THE16
COMMISSION AS ADMINISTRATIVE LAW JUDGES WHO HAVE THE AUTHORITY17
TO ADMINISTER OATHS, EXAMINE WITNESSES, RECEIVE EVIDENCE, AND18
CONDUCT HEARINGS, INVESTIGATIONS, AND OTHER PROCEEDINGS ON19
BEHALF OF THE COMMISSION.20
SECTION 6. In Colorado Revised Statutes, amend 34-60-115 as21
follows:22
34-60-115. Limitation on actions. (1) No
AN action or other23
proceeding based upon a violation of this article ARTICLE 60 or any rule24
regulation, or order of the commission shall NOT be commenced or25
maintained unless it has been commenced within one year from THREE26
YEARS AFTER the date of the DISCOVERY OF THE alleged violation.27
1346
-19- (2) THE THREE-YEAR PERIOD OF LIMITATION DESCRIBED IN1
SUBSECTION (1) OF THIS SECTION DOES NOT APPLY IF INFORMATION2
REGARDING THE ALLEGED VIOLATION IS KNOWINGLY OR WILLFULLY3
CONCEALED BY THE ALLEGED VIOLATOR .4
SECTION 7. In Colorado Revised Statutes, 34-60-121, amend5
(1)(a), (1)(b), (1)(c)(I)(C), (1)(c)(I)(D), (1)(d), (1)(e), (4)(c), (5), (6),6
(7)(a) introductory portion, and (7)(b) as follows:7
34-60-121. Violations - investigations - penalties - rules -8
definition - legislative declaration. (1) (a) Any
ENERGY AND CARBON9
MANAGEMENT operator that violates this article
ARTICLE 60, any rule or10
order of the commission, or any permit is subject to a penalty of not more11
than fifteen thousand dollars for each act of violation per day that such12
THE violation continues. A VIOLATION DESCRIBED IN THIS SUBSECTION13
(1)(a)
CONTINUES FOR EACH DAY THAT IT IS NOT CORRECTED BY THE14
ENERGY AND CARBON MANAGEMENT OPERATOR .15
(b) The commission may impose a penalty by order only after a16
hearing in accordance with section 34-60-108 or by an administrative17
order by consent entered into by the commission and the
ENERGY AND18
CARBON MANAGEMENT operator.19
(c) The commission shall:20
(I) Promulgate rules that establish a penalty schedule appropriate21
to the nature of the violation and provide for the consideration of any22
aggravating or mitigating circumstances. The rules must establish the23
basis for determining the duration of a violation for purposes of imposing24
the applicable penalty and include presumptions that:25
(C) The failure to diligently implement corrective action pursuant26
to a schedule embodied in an administrative order on consent, order27
1346
-20- finding violation, or other order of the commission constitutes an1
independent violation for which the
ENERGY AND CARBON MANAGEMENT2
operator may be subject to additional penalties or corrective action orders3
imposed by the commission; and4
(D) The number of days of violation does not include any period5
necessary to allow the
ENERGY AND CARBON MANAGEMENT operator to6
engage in good faith negotiation with the commission regarding an7
alleged violation if the
ENERGY AND CARBON MANAGEMENT operator8
demonstrates a prompt, effective, and prudent response to the violation.9
(d) An
ENERGY AND CARBON MANAGEMENT operator subject to a10
penalty order shall pay the amount due within thirty days after its11
imposition unless the
ENERGY AND CARBON MANAGEMENT operator files12
a judicial appeal. The commission may recover penalties owed under this13
section in a civil action brought by the attorney general at the request of14
the commission in the second judicial district. Money collected through15
the imposition of penalties shall
MUST be credited first to any legal costs16
and attorney fees incurred by the attorney general in the recovery action17
and then to the environmental response account in the energy and carbon18
management cash fund created in section 34-60-122 (5).19
(e) The general assembly hereby declares that the purposes of this20
subsection (1) are to deter noncompliance and to encourage any21
out-of-compliance
ENERGY AND CARBON M ANAGEMENT operators to come22
into compliance as soon as possible and to those ends intends that, in23
determining the amount of a penalty, the commission should not reduce24
the number of days of violation for which a penalty is assessed below that25
number which the evidence supports.26
(4) (c) Whenever the commission or the director has reasonable27
1346
-21- cause to believe a violation of any provision of this article 60, any rule or1
order of the commission, or any permit has occurred, including based on2
a written complaint from any person, the commission or the director shall3
provide written notice to the
ENERGY AND CARBON MANAGEMENT4
operator whose act or omission allegedly resulted in the violation and5
require that the
ENERGY AND CARBON MANAGEMENT operator remedy the6
violation. The notice must be served personally or by certified mail,7
return receipt requested, to the
ENERGY AND CARBON MANAGEMENT8
operator or the
ENERGY AND CARBON MANAGEMENT operator's agent for9
service of process and must state the provision alleged to have been10
violated, the facts alleged to constitute the violation, and any corrective11
action and abatement deadlines the commission or director elects to12
require of the
ENERGY AND CARBON MANAGEMENT operator.13
(5) (a) If an
ENERGY AND CARBON MANAGEMENT operator fails to14
take corrective action required pursuant to subsection (4) of this section,15
or whenever the commission or the director has evidence that a violation16
of any provision of this article
ARTICLE 60, or of any rule regulation, or17
order of the commission, or of any permit has occurred, under18
circumstances deemed to constitute an emergency situation, the19
commission or the director may issue a cease-and-desist order to the20
ENERGY AND CARBON MANAGEMENT operator whose act or omission21
allegedly resulted in such
THE violation. Such THE cease-and-desist order22
shall MUST require such action by the ENERGY AND CARBON23
MANAGEMENT operator as the commission or director deems appropriate.24
The order shall MUST be served personally or by certified mail, return25
receipt requested, to the
ENERGY AND CARBON MANAGEMENT operator or26
the
ENERGY AND CARBON MANAGEMENT operator's agent for service of27
1346
-22- process and shall MUST state the provision alleged to have been violated,1
the facts alleged to constitute the violation, the time by which the acts or2
practices cited are required to cease, and any corrective action the3
commission or the director elects to require of the
ENERGY AND CARBON4
MANAGEMENT operator.5
(b) The commission or the director may require an
ENERGY AND6
CARBON MANAGEMENT operator to appear for a hearing before the7
commission no sooner than fifteen days after the issuance of a8
cease-and-desist order; except that the
ENERGY AND CARBON9
MANAGEMENT operator may request an earlier hearing. At any hearing10
concerning a cease-and-desist order, the commission shall permit all11
interested parties and any complaining parties to present evidence and12
argument and to conduct cross-examination required for a full disclosure13
of the facts.14
(c) In the event
THAT an ENERGY AND CARBON MANAGEMENT15
operator fails to comply with a cease-and-desist order, the commission16
may request the attorney general to bring suit pursuant to section17
34-60-109.18
(6) If the commission determines, after a hearing conducted in19
accordance with section 34-60-108, that an
ENERGY AND CARBON20
MANAGEMENT operator has failed to perform any corrective action21
imposed under subsection (4) of this section or failed to comply with a22
cease-and-desist order issued under subsection (5) of this section with23
regard to a violation of a permit provision, the commission may issue an24
order suspending, modifying, or revoking such
THE permit or may take25
other appropriate action. An
ENERGY AND CARBON MANAGEMENT26
operator subject to an order that suspends, modifies, or revokes a permit27
1346
-23- shall continue the affected operations only for the purpose of bringing1
them THE AFFECTED OPERATIONS into compliance with the permit or2
modified permit and shall do so MUST BRING THE AFFECTED OPERATIONS3
INTO COMPLIANCE under the supervision of the commission. Once the4
affected operations are in compliance to the satisfaction of the5
commission and any penalty not subject to judicial review or appeal has6
been paid, the commission shall reinstate the permit.7
(7) (a) The commission or the director shall issue an order to an8
ENERGY AND CARBON MANAGEMENT operator to appear for a hearing9
before the commission in accordance with section 34-60-108 whenever10
the commission or the director has evidence that an
ENERGY AND CARBON11
MANAGEMENT operator is responsible for:12
(b) If the commission finds, after such hearing, that the
ENERGY13
AND CARBON MANAGEMENT operator is responsible under the legal14
standards specified in paragraph (a) of this subsection (7), it
SUBSECTION15
(7)(a)
OF THIS SECTION, THE COMMISSION may issue an order that prohibits16
the issuance of any new permits to the
ENERGY AND CARBON17
MANAGEMENT operator, suspends any or all of the ENERGY AND CARBON18
MANAGEMENT operator's certificates of clearance, or both. When the19
ENERGY AND CARBON MANAGEMENT operator demonstrates to the20
satisfaction of the commission that it has brought each of the violations21
into compliance and that any penalty not subject to judicial review or22
appeal has been paid, the commission may vacate the order.23
SECTION 8. In Colorado Revised Statutes, 34-60-124, amend24
(3), (4)(a)(II),
(4)(e)(II), (4)(f), (6)(a), (6)(c), (7), and (8)(b); and add25
(4)(g) as follows:26
34-60-124. Energy and carbon management cash fund -27
1346
-24- definitions - repeal. (3) The money in the fund is subject to annual1
appropriation by the general assembly; except that money deposited in the2
fund constituting forfeited security or other financial assurance provided3
by
ENERGY AND CARBON MANAGEMENT operators in accordance with4
section 34-60-106 (3.5), (9)(c)(IV)(A), and (13) is continuously5
appropriated to the commission for the purpose of fulfilling obligations6
under this article 60 upon which an
ENERGY AND CARBON MANAGEMENT7
operator has defaulted.8
(4) The fund may be expended:9
(a) By the commission, or by the director at the commission's10
direction, prior to, during, or after the conduct of any operations subject11
to the authority of the commission to:12
(II) Gather background or baseline data on any air, water, soil, or13
biological resource that the commission determines may be so impacted14
by the conduct of oil and gas
ENERGY AND CARBON MANAGEMENT15
operations; and16
(e) (II) This subsection (4)(e) is repealed, effective July 1, 2025;17
and18
(f) To create and maintain the website described in section19
34-60-106 (22); AND20
(g) BY THE COMMISSION FOR THE PURPOSE OF INFORMATION21
TECHNOLOGY INITIATIVES.22
(6) For the purposes provided for in subsection (4) of this section,23
the commission is authorized to:24
(a) Enter onto any lands or waters, public or private; and, except25
in emergency situations, the commission shall provide reasonable notice26
prior to such entry in order to allow a surface owner, local government27
1346
-25- designee, ENERGY AND CARBON MANAGEMENT operator, or responsible1
party to be present and to obtain duplicate samples and copies of2
analytical reports;3
(c) Confiscate and sell for salvage any equipment abandoned by4
a responsible party at a location where the conduct of oil and gas ENERGY5
AND CARBON MANAGEMENT operations has resulted in a significant6
adverse environmental impact; except that this authority shall be IS7
subject to and secondary to any valid liens, security interests, or other8
legal interests in such equipment asserted by any taxing authority or by9
any creditor of the responsible party.10
(7) If the commission determines that mitigation of a significant11
adverse environmental impact on any air, water, soil, or biological12
resource is necessary as a result of the conduct of oil and gas ENERGY13
AND CARBON MANAGEMENT operations, the commission shall issue an14
order requiring the responsible party to perform such THE mitigation. If15
the responsible party cannot be identified or refuses to comply with such16
THE order, the commission shall authorize the necessary expenditures17
from the fund. The commission shall bring suit in the second judicial18
district to recover such THE expenditures from any responsible party who19
THAT refuses to perform such THE mitigation or any responsible party20
who THAT is subsequently identified, such THE action to be brought21
within a two-year period from AFTER the date that final expenditures were22
authorized. Moneys MONEY recovered as a result of such THE suit shall23
MUST first be applied to the commission's legal costs and attorney fees24
and shall MUST then be credited to the fund.25
(8) As used in this section:26
(b) (I) "Responsible party" means any person who conducts an oil27
1346
-26- and gas ENERGY AND CARBON MANAGEMENT operation in a manner that1
violates any then-applicable provision of this article 60, or of any rule or2
order of the commission, or of any permit that threatens to cause, or3
actually causes, a significant adverse environmental impact to any air,4
water, soil, or biological resource. "Responsible party" includes any5
person who disposes of any other waste by mixing it with exploration and6
production waste that threatens to cause, or actually causes, a significant7
adverse environmental impact to any air, water, soil, or biological8
resource.9
(II) Except as otherwise provided in subsection (8)(b)(I) of this10
section, "responsible party" does not include any landowner, whether of11
the surface estate, mineral estate, or both, who does not engage in, or12
assume responsibility for, the conduct of oil and gas ENERGY AND13
CARBON MANAGEMENT operations.14
SECTION 9. In Colorado Revised Statutes, amend 34-60-131 as15
follows:16
34-60-131. No land use preemption. Local governments and17
state agencies, including the commission and agencies listed in section18
34-60-105 (1)(b), have regulatory authority over oil and gas development19
ENERGY AND CARBON MANAGEMENT OPERATIONS , including as specified20
in section 34-60-105 (1)(b). A local government's regulations may be21
more protective or stricter than state requirements.22
SECTION 10. In Colorado Revised Statutes, 34-60-134, repeal23
(1)(b) as follows:24
34-60-134. Reporting of water used in oil and gas operations25
- cumulative reporting - definitions - rules - repeal. (1) Definitions.26
As used in this section and in section 34-60-135, unless the context27
1346
-27- otherwise requires:1
(b) "Disproportionately impacted community" has the meaning set2
forth in section 24-4-109 (2)(b)(II).3
SECTION 11. In Colorado Revised Statutes, add 34-60-140,4
34-60-141, 34-60-142, and 34-60-143 as follows:5
6
34-60-140. Ownership of geologic storage resources and7
injection carbon dioxide - legislative declaration. (1) T HE GENERAL8
ASSEMBLY DECLARES THAT THIS SECTION IS INTENDED TO ALLOW FOR THE9
PERMANENT USE OF GEOLOGIC STORAGE RESOURCES FOR GEOLOGIC10
STORAGE OPERATIONS AND IS NOT INTENDED TO IMPACT THE USE OR11
OWNERSHIP OF THE SUBSURFACE FOR CONJUNCTIVE USE OF SURFACE AND12
GROUNDWATER RESOURCES , ARTIFICIAL RECHARGE, STORAGE, AND13
EXTRACTION INTENDED TO MAXIMIZE UTILIZATION OF WATER FOR14
BENEFICIAL USE OR OTHER OPERATIONS .15
(2) (a) E
XCEPT AS SET FORTH IN SUBSECTION
(5) OF THIS SECTION:16
(I) I
F OWNERSHIP OF THE SEQUESTRATION ESTATE HAS NOT BEEN17
SEPARATELY SEVERED , CONVEYED, OR RESERVED PURSUANT TO18
SUBSECTION (2)(b) OF THIS SECTION, IT IS PRESUMED THAT OWNERSHIP OF19
THE SEQUESTRATION ESTATE IN THE STATE IS VESTED IN THE OWNER OF20
THE OVERLYING SURFACE ESTATE ; AND21
(II) O
WNERSHIP OF
INJECTION CARBON DIOXIDE AND THE22
FACILITIES AND EQUIPMENT THAT STORE INJECTION CARBON DIOXIDE IN23
THE STATE IS VESTED IN:24
(A) T
HE PERSON THAT INJECTS THE
INJECTION CARBON DIOXIDE25
INTO A GEOLOGIC STORAGE RESOURCE ; OR26
(B) A
NY PERSON CONVEYED TITLE TO THE
INJECTION CARBON27
1346
-28- DIOXIDE OR THE FACILITIES AND EQUIPMENT THAT STORE THE INJECTION1
CARBON DIOXIDE BY THE PERSON DESCRIBED IN SUBSECTION (2)(a)(II)(A)2
OF THIS SECTION.3
(b) O
WNERSHIP OF A SEQUESTRATION ESTATE MAY BE :4
(I) S
EVERED FROM THE OWNERSHIP OF THE OVERLYING SURFACE5
ESTATE; AND6
(II) C
ONVEYED OR RESERVED IN THE SAME M ANNER AS OWNERSHIP7
OF A MINERAL ESTATE.8
(3) A
NY CONVEYANCE OF THE OWNERSHIP OF AN OVERLYING9
SURFACE ESTATE ALSO CONVEYS ALL OF THE GRANTOR 'S OWNERSHIP OF10
ANY SEQUESTRATION ESTATE UNLESS :11
(a) T
HE CONVEYANCE INSTRUMENT EXPRESSLY RESERVES THE12
SEQUESTRATION ESTATE, INCLUDING BY BROAD RESERVATION OF PORE13
SPACE; OR14
(b) T
HE SEQUESTRATION ESTATE HAS BEEN PREVIOUSLY SEVERED ,15
BY RESERVATION OR CONVEYANCE , FROM THE OWNERSHIP OF THE16
OVERLYING SURFACE ESTATE .17
(4) A
CONVEYANCE OF THE OWNERSHIP OF A MINERAL ESTATE OR18
ANOTHER SUBSURFACE INTEREST DOES NOT CONVEY THE GRANTOR 'S19
OWNERSHIP IN THE SEQUESTRATION ESTATE UNLESS THE CONVEYANCE20
INSTRUMENT EXPRESSLY PROVIDES FOR CONVEYANCE OF THE GRANTOR 'S21
OWNERSHIP OF THE SEQUESTRATION ESTATE .22
23
(5) NOTWITHSTANDING ANY PROVISION OF LAW TO THE24
CONTRARY, NOTHING IN THIS SECTION:25
(a) A
FFECTS ANY OWNERSHIP OR RIGHTS TO PORE SPACE , A26
SEQUESTRATION ESTATE, OR
INJECTION CARBON DIOXIDE OR TO FACILITIES27
1346
-29- AND EQUIPMENT THAT STORE INJECTION CARBON DIOXIDE THAT ARE1
ACQUIRED OR RESERVED BEFORE THE EFFECTIVE DATE OF HOUSE BILL2
24-1346, ENACTED IN 2024;3
(b) C
HANGES OR ALTERS THE COMMON LAW AS OF THE EFFECTIVE4
DATE OF
HOUSE BILL 24-1346, ENACTED IN 2024, AS IT RELATES TO THE5
OWNERSHIP OF REAL PROPERTY , INCLUDING SURFACE ESTATES , PORE6
SPACE, OR A MINERAL ESTATE, OR TO THE RIGHTS OR DOMINANCE OF A7
MINERAL ESTATE; OR8
(c) A
FFECTS THE ABILITY OF AN OWNER OF PORE SPACE TO :9
(I) B
ROADLY CONVEY OR RESERVE ALL OF THE OWNER 'S RIGHT,10
TITLE, AND INTEREST IN AND TO PORE SPACE , INCLUDING THE OWNER'S11
INTEREST IN A SEQUESTRATION ESTATE; OR12
(II) C
ONVEY OR RESERVE ANY RIGHT, TITLE, OR INTEREST IN AND13
TO ESTATES IN PORE SPACE OTHER THAN THE SEQUESTRATION ESTATE .14
34-60-141. Geologic storage units - legislative declaration -15
definitions. (1) T
HE GENERAL ASSEMBLY DECLARES THAT THE PURPOSE16
OF THIS SECTION IS THE PROTECTION OF CORRELATIVE RIGHTS ,17
FACILITATION OF COLORADO'S ENERGY RESOURCES, AND FACILITATION OF18
THE USE OF GEOLOGIC STORAGE RESOURCES FOR GEOLOGIC STORAGE19
OPERATIONS.20
(2) A
S USED IN THIS SECTION, UNLESS THE CONTEXT OTHERWISE21
REQUIRES:22
(a) "G
EOLOGIC STORAGE UNIT ORDER " MEANS AN ORDER THAT23
PROVIDES FOR THE FORMATION OF A GEOLOGIC STORAGE UNIT AND THAT24
IS ENTERED BY THE COMMISSION PURSUANT TO SUBSECTION (4)(b) OF THIS25
SECTION.26
(b) "P
LAN" MEANS A PLAN FOR GEOLOGIC STORAGE OPERATIONS27
1346
-30- OF THE GEOLOGIC STORAGE UNIT APPROVED BY THE COMMISSION1
PURSUANT TO SUBSECTION (4)(c)(II) OF THIS SECTION.2
(3) A
N AGREEMENT FOR GEOLOGIC STORAGE OR GEOLOGIC3
STORAGE OPERATIONS, OR FOR CARRYING ON ANY OTHER METHODS OF4
UNIT OR COOPERATIVE DEVELOPMENT OR OPERATION OF A GEOLOGIC5
STORAGE RESOURCE, IS AUTHORIZED AND MAY BE PERFORMED , AND, IF6
THE AGREEMENT IS APPROVED BY THE COMMISSION AS BEING IN THE7
PUBLIC INTEREST OR IS REASONABLY NECESSARY FOR GEOLOGIC STORAGE8
OPERATIONS, DOES NOT VIOLATE ANY STATUTES RELATING TO TRUSTS ,9
MONOPOLIES, OR CONTRACTS AND COMBINATIONS IN RESTRAINT OF10
TRADE.11
(4) (a) U
PON THE APPLICATION OF ANY INTERESTED PERSON , THE12
COMMISSION SHALL HOLD A HEARING TO CONSIDER THE NEED FOR A13
GEOLOGIC STORAGE UNIT.14
(b) T
HE COMMISSION SHALL ENTER AN ORDER PROVIDING FOR THE15
FORMATION OF A GEOLOGIC STORAGE UNIT IF THE COMMISSION FINDS THAT16
THE GEOLOGIC STORAGE UNIT IS REASONABLY NECESSARY TO EFFECTUATE17
A GEOLOGIC STORAGE PROJECT. THE GEOLOGIC STORAGE UNIT AREA OF A18
GEOLOGIC STORAGE UNIT MUST BE BASED ON SITE CHARACTERIZATION19
AND MODELING CONDUCTED PURSUANT TO THE FEDERAL "SAFE DRINKING20
W
ATER ACT", 42 U.S.C. SEC. 300f ET SEQ., AS AMENDED, AND ANY RULES21
ESTABLISHED BY THE COMMISSION PURSUANT TO THE FEDERAL ACT .22
(c) A
GEOLOGIC STORAGE UNIT ORDER MUST :23
(I) I
NCLUDE TERMS AND CONDITIONS THAT ARE JUST AND24
REASONABLE;25
(II) E
STABLISH A PLAN FOR OPERATIONS OF THE GEOLOGIC26
STORAGE UNIT, WHICH PLAN MUST INCLUDE:27
1346
-31- (A) A DESCRIPTION OF THE GEOLOGIC STORAGE UNIT AREA ;1
(B) A
DESCRIPTION OF THE OPERATIONS THAT WILL BE CONDUCTED2
IN THE GEOLOGIC STORAGE UNIT AREA ;3
(C) A
DETERMINATION OF THE PERCENTAGE OF EACH GEOLOGIC4
STORAGE RESOURCE ALLOCATED TO EACH SEPARATELY OWNED TRACT5
WITHIN THE GEOLOGIC STORAGE UNIT AREA ;6
(D) A
DESCRIPTION OF THE METHOD BY WHICH EACH OWNER OF A7
SEQUESTRATION ESTATE INCLUDED IN THE GEOLOGIC STORAGE UNIT AREA8
WILL BE ALLOCATED COMPENSATION RELATED TO THE USE OF THE9
SEQUESTRATION ESTATE;10
(E) A
DESCRIPTION OF THE MANNER IN WHICH THE GEOLOGIC11
STORAGE UNIT AREA WILL BE SUPERVISED AND MANAGED AND , IF12
APPLICABLE, HOW COSTS RELATED TO OPERATIONS OF THE GEOLOGIC13
STORAGE UNIT WILL BE ALLOCATED AND PAID ;14
(F) T
HE TIME WHEN OPERATIONS OF THE GEOLOGIC STORAGE UNIT15
WILL COMMENCE AND THE MANNER IN WHICH , AND THE CIRCUMSTANCES16
UNDER WHICH, OPERATIONS OF THE GEOLOGIC STORAGE UNIT WILL17
TERMINATE; AND18
(G) A
NY ADDITIONAL PROVISIONS THAT ARE FOUND TO BE19
APPROPRIATE FOR CONDUCTING OPERATIONS OF THE GEOLOGIC STORAGE20
UNIT AND FOR THE PROTECTION OF CORRELATIVE RIGHTS .21
(d) A
GEOLOGIC STORAGE UNIT ORDER IS EFFECTIVE ONLY IF :22
(I) T
HE PLAN HAS BEEN APPROVED IN WRITING BY THOSE PERSONS23
THAT, PURSUANT TO THE GEOLOGIC STORAGE UNIT ORDER , COLLECTIVELY24
OWN AT LEAST SEVENTY -FIVE PERCENT OF THE GEOLOGIC STORAGE25
RESOURCES INCLUDED IN THE GEOLOGIC STORAGE UNIT AREA ; AND26
(II) T
HE COMMISSION MAKES A FINDING IN THE GEOLOGIC STORAGE27
1346
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SUBSECTION (4)(d)(I) OF THIS SECTION.2
(5) A
GEOLOGIC STORAGE UNIT ORDER MAY BE AMENDED BY AN3
ORDER MADE BY THE COMMISSION IN THE SAME MANNER AND SUBJECT TO4
THE SAME CONDITIONS AS THE ORIGINAL GEOLOGIC STORAGE UNIT ORDER .5
(6) A
NY OWNER OF A SEQUESTRATION ESTATE INCLUDED IN THE6
GEOLOGIC STORAGE UNIT AREA THAT IS NOT INCLUDED IN THE GEOLOGIC7
STORAGE UNIT ORDER MAY PETITION THE COMMISSION FOR INCLUSION IN8
THE GEOLOGIC STORAGE UNIT ORDER .9
(7) N
OTWITHSTANDING ANY PROVISION OF LAW TO THE10
CONTRARY:11
(a) N
OTHING IN THIS SECTION CONFERS ON ANY PERSON THE RIGHT12
OF EMINENT DOMAIN; AND13
(b) A
GEOLOGIC STORAGE UNIT ORDER DOES NOT GRANT TO ANY14
PERSON THE RIGHT OF EMINENT DOMAIN .15
(8) G
EOLOGIC STORAGE OPERATIONS CONDUCTED PURSUANT TO16
A GEOLOGIC STORAGE UNIT ORDER , INCLUDING THE COMMENCEMENT ,17
DRILLING, OR OPERATION OF A CLASS VI INJECTION WELL ON ANY PORTION18
OF THE GEOLOGIC STORAGE UNIT AREA , CONSTITUTE, FOR ALL PURPOSES,19
GEOLOGIC STORAGE OPERATIONS ON EACH SEPARATELY OWNED TRACT IN20
THE GEOLOGIC STORAGE UNIT AREA BY THE OWNERS OF SEQUESTRATION21
ESTATES INCLUDED IN THE GEOLOGIC STORAGE UNIT AREA .22
(9) A
GEOLOGIC STORAGE UNIT ORDER MUST NOT BE CONSTRUED23
TO RESULT IN A TRANSFER OF ALL OR ANY PART OF THE TITLE OF ANY24
PERSON TO THE SEQUESTRATION ESTATE OR ASSOCIATED RIGHTS IN ANY25
TRACT IN THE GEOLOGIC STORAGE UNIT AREA .26
34-60-142. Technical assistance to local governments. T O27
1346
-33- PROVIDE A LOCAL GOVERNMENT WITH TECHNICAL ASSISTANCE REGARDING1
THE LOCAL GOVERNMENT 'S DEVELOPMENT OF LAND USE AND SITING2
REGULATIONS FOR GEOLOGIC STORAGE OPERATIONS, THE LOCAL3
GOVERNMENT THAT HAS LAND USE JURISDICTION MAY REQUEST THAT THE4
DIRECTOR OF THE COMMISSION APPOINT A TECHNICAL REVIEW BOARD TO5
ASSIST THE LOCAL GOVERNMENT BY ANALYZING AND ANSWERING ANY6
TECHNICAL QUESTIONS NECESSARY FOR THE LOCAL GOVERNMENT TO7
DEVELOP THE LOCAL GOVERNMENT 'S ASSOCIATED LAND USE8
REGULATIONS.9
34-60-143. Coordination between the department of public10
health and environment and the commission on geologic storage11
operations - definition. (1) A
S USED IN THIS SECTION, UNLESS THE12
CONTEXT OTHERWISE REQUIRES, "DEPARTMENT" MEANS THE DEPARTMENT13
OF PUBLIC HEALTH AND ENVIRONMENT .14
(2) (a) T
HE DEPARTMENT SHALL DEVELOP CARBON DIOXIDE15
ACCOUNTING PROCEDURES FOR
GEOLOGIC STORAGE OPERATIONS. THE16
COMMISSION SHALL COMPILE RELEVANT DATA PURSUANT TO THE17
COMMISSION'S REGULATORY AUTHORITY TO SUPPORT THE CARBON18
DIOXIDE ACCOUNTING PROCEDURES DEVELOPED BY THE DEPARTMENT .19
(b) T
HE COMMISSION AND THE DEPARTMENT SHALL WORK20
COLLABORATIVELY TO IMPLEMENT SUBSECTION (2)(a) OF THIS SECTION21
AND TO SHARE DATA TO FACILITATE THE MONITORING , VERIFICATION, AND22
ACCOUNTING OF CARBON DIOXIDE IN
GEOLOGIC STORAGE OPERATIONS.23
(3) T
HE COMMISSION AND THE DEPARTMENT SHALL WORK24
COLLABORATIVELY TO FACILITATE APPLICATION OF THE DEPARTMENT 'S25
REGULATORY AUTHORITY TO ADDRESS AIR EMISSIONS FROM
GEOLOGIC26
STORAGE OPERATIONS. THE COMMISSION SHALL REQUIRE OPERATORS OF 27
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FROM THE DEPARTMENT.2
SECTION 12. In Colorado Revised Statutes, 24-30-1003, amend3
(1) as follows:4
24-30-1003. Administrative law judges - appointment -5
qualifications - standards of conduct. (1) The executive director of the6
department of personnel may appoint such administrative law judges,7
except those employed pursuant to sections 24-50-103 (7), 34-60-108,8
and 40-2-104, C.R.S., as may be necessary to provide services to each9
state agency; except
THAT the state personnel board, THE ENERGY AND10
CARBON MANAGEMENT COMMISSION , and the public utilities commission11
entitled to
MAY use administrative law judges. Administrative law judges12
shall MUST be appointed in accordance with the provisions of section 1313
of article XII of the state constitution and the laws and rules governing14
the state personnel system.15
SECTION 13. In Colorado Revised Statutes, 2-3-128, amend16
(1)(d) as follows:17
2-3-128. Oil and gas - performance audit - report - definitions18
- repeal. (1) As used in this section, unless the context otherwise19
requires:20
(d) "Operator" has the meaning set forth in section 34-60-103.21
(6.8).22
SECTION 14. In Colorado Revised Statutes, 25-7-132, amend23
(2)(a)(I) as follows:24
25-7-132. Emission data - public availability - submission of25
2023 reports to state auditor - definitions - repeal. (2) (a) As used in26
this subsection (2), unless the context otherwise requires:27
1346
-35- (I) "Operator" has the meaning set forth in section 34-60-103.1
(6.8).2
SECTION 15. In Colorado Revised Statutes, 25-15-101, amend3
(6)(b)(IX) and (6)(b)(X) as follows:4
25-15-101. Definitions. As used in this article 15, unless the5
context otherwise requires:6
(6) (b) "Hazardous waste" does not include:7
(IX) Waste from oil and gas operations, as defined in section8
34-60-103, (6.5), or from deep geothermal operations, as defined in9
section 37-90.5-103 (3), including, but not limited to, drilling fluids,10
produced water, and other wastes associated with the exploration,11
development, or production of crude oil, natural gas, or geothermal12
resources, that is disposed of in accordance with the requirements of the13
energy and carbon management commission pursuant to article 90.5 of14
title 37 and article 60 of title 34, as applicable; and15
(X) Exploration and production waste, as defined in section16
34-60-103. (4.5).17
SECTION 16. In Colorado Revised Statutes, 25-15-603, amend18
(15) as follows:19
25-15-603. Definitions - repeal. As used in this part 6, unless the20
context otherwise requires:21
(15) "Oil and gas operations" has the meaning set forth in section22
34-60-103. (6.5).23
SECTION 17. In Colorado Revised Statutes, 29-20-104, amend24
(1)(h) introductory portion, (1)(h)(II), and (3)(a)(I) as follows:25
29-20-104. Powers of local governments - definition.26
(1) Except as expressly provided in section 29-20-104.2 or 29-20-104.5,27
1346
-36- the power and authority granted by this section does not limit any power1
or authority presently exercised or previously granted. Except as provided2
in section 29-20-104.2, each local government within its respective3
jurisdiction has the authority to plan for and regulate the use of land by:4
(h) Regulating the surface impacts of oil and gas operations, as5
defined in section 34-60-103 (6.5), deep geothermal operations, as6
defined in section 37-90.5-103 (3), class VI injection wells, and intrastate7
underground natural gas storage facilities, as defined in section 34-64-1028
(3.5) ENERGY AND CARBON MANAGEMENT OPERATIONS , AS DEFINED IN9
SECTION 34-60-103, in a reasonable manner to address matters specified10
in this subsection (1)(h) and to protect and minimize adverse impacts to11
public health, safety, and welfare and the environment. Nothing in this12
subsection (1)(h) is intended to alter, expand, or diminish the authority of13
local governments to regulate air quality under section 25-7-128. As used14
in this subsection (1)(h), "minimize adverse impacts" means, to the extent15
necessary and reasonable, to protect public health, safety, and welfare and16
the environment by avoiding adverse impacts from oil and gas operations,17
as defined in section 34-60-103 (6.5), deep geothermal operations, as18
defined in section 37-90.5-103 (3), class VI injection wells, and intrastate19
underground natural gas storage facilities, as defined in section 34-64-10220
(3.5) ENERGY AND CARBON MANAGEMENT OPERATIONS , AS DEFINED IN21
SECTION 34-60-103, and minimizing and mitigating the extent and22
severity of those impacts that cannot be avoided. The following matters23
are covered by this subsection (1)(h):24
(II) The location and siting of oil and gas facilities and oil and gas25
locations, as those terms are defined in section 34-60-103 (6.2) and (6.4);26
deep geothermal operations, as defined in section 37-90.5-103 (3); class27
1346
-37- VI injection wells; and intrastate underground natural gas storage1
facilities, as defined in section 34-64-102 (3.5) ENERGY AND CARBON2
MANAGEMENT OPERATIONS , AS DEFINED IN SECTION 34-60-103;3
(3) (a) To provide a local government with technical expertise4
regarding whether a preliminary or final determination of the location of5
an oil and gas facility or oil and gas location within its respective6
jurisdiction could affect oil and gas resource recovery:7
(I) Once an operator, as defined in section 34-60-103, (6.8), files8
an application for the location and siting of an oil and gas facility or oil9
and gas location and the local government has made either a preliminary10
or final determination regarding the application, the local government11
having THAT HAS land use jurisdiction may ask the director of the energy12
and carbon management commission pursuant to section 34-60-104.5 (3)13
to appoint a technical review board to conduct a technical review of the14
preliminary or final determination and issue a report that contains the15
board's conclusions.16
SECTION 18. In Colorado Revised Statutes, 30-20-101, amend17
(6)(b)(VI) as follows:18
30-20-101. Definitions. As used in this part 1, unless the context19
otherwise requires:20
(6) (b) "Solid waste" does not include:21
(VI) Exploration and production wastes, as defined in section22
34-60-103, (4.5), C.R.S., except as such THE EXPLORATION AND23
PRODUCTION wastes may be deposited at a commercial solid waste24
facility;25
SECTION 19. In Colorado Revised Statutes, 39-29-112, amend26
(8)(a)(I) as follows:27
1346
-38- 39-29-112. Procedures and reports - definitions - repeal.1
(8) (a) As used in this subsection (8), unless the context otherwise2
requires:3
(I) "Operator" has the meaning set forth in section 34-60-103.4
(6.8).5
SECTION 20. Safety clause. The general assembly finds,6
determines, and declares that this act is necessary for the immediate7
preservation of the public peace, health, or safety or for appropriations for8
the support and maintenance of the departments of the state and state9
institutions.10
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