County considers change in oil and gas lease fees

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Moffat County government is changing the way it does business with gas and oil companies, and plans to look into surface owners' rights in the next couple months.

These changes come as Moffat County heads into what may be an oil boom. The county has authorized two mineral leases in the last two weeks, and seven interested parties have approached Comstock regarding leases in the past month.

During an oil and gas workshop at the Moffat County courthouse on Friday, Natural Resources Department Director Jeff Comstock presented proposed changes to oil and gas lease negotiation policies.

Comstock and Dan Davidson, Museum of Northwest Colorado director, negotiate most of the county's mineral leases. Currently, they demand at least $35 per mineral acre and 16.67 percent in production royalties. Comstock proposed removing those restrictions, so the county can do business with companies they might want to offer a higher dollar amount per acre, but a lower royalty rate.

Previously, oil and gas companies had to fill out an intent-to-drill data sheet and submit copies of applications to state and government agencies and maps of the drill sites, before drilling.

The new intent-to-drill regulations would require companies to submit forms to eight departments or individuals. Permits must be sought from the planning, road and bridge, natural resources, and state highway departments. Agreements must be sought with surface owners and water-rights owners, if the company's water source is a well, stock pond or irrigation ditch.

Temporary use permits for temporary living trailers, conditional use permits for pipelines, and driveway permits would each have fees.

All this comes as some county residents, such as Wes McStay, object to the county's dealings in mineral rights. He has said it could be unethical for the county to use tax dollars to fund these projects.

Davidson responded that the museum's mineral rights have been donated by private citizens, who have the right to dispose of the property as they see fit.

McStay attended the meeting to voice his concern about surface owners' rights when the county leases mineral acres under their property.

"Most of the activity is on someone else's land," McStay said. "We should share the pain and the gain."

The county requires the drilling company to make every reasonable attempt to reach an agreement with the surface owner, but the government doesn't review the agreement because it isn't their business, Comstock said.

The Board of Commissioners agreed to host a workshop for public comment on surface owners' rights in the upcoming months.

Rob Gebhart can be reached at 824-7031 or by e-mail at rgebhart@craigdailypress.com.

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