DENVER -- Colorado Gov. Bill Ritter, who has made promoting renewable energy a cornerstone of his administration, on Thursday called natural gas "a mission-critical fuel" that is essential to the state and nation's economy.
"Natural gas is a vital part of the new energy economy, a permanent part of the new energy economy, not a bridge fuel, not a transition fuel, but a mission-critical fuel," Ritter told a crowd of industry officials at the Colorado Oil and Gas Association's annual conference in Denver.Ritter and the Denver-based trade group have frequently been at odds as his administration promoted stricter oil and gas regulations and a "new energy economy" that includes attracting renewable energy companies to Colorado.
The association filed a lawsuit this spring to overturn new regulations that implemented two 2007 laws requiring more weight be given to the environment, wildlife and public health and safety when oil and gas development is considered.
Association spokesman Nate Strauch called Ritter's speech "eye-opening." He said industry representatives hope it signals a narrowing of differences with the governor.
"I think the industry is just very encouraged by what it heard today," Strauch said.Industry officials have assailed Colorado's new rules, which took effect April 1, as some of the most burdensome in the country. They said the rules have contributed to the slowdown in the state's oil and gas production.
A state commission that regulates oil and gas development was also overhauled to include more members outside the industry.
State regulators and the rules' proponents, including environmental, hunting and angling groups, said the recession, low natural gas prices and tight credit are behind the decline in production, not the regulations.
Even before Thursday's speech, Ritter had made overtures to the industry. He has urged federal officials to quickly certify proposed natural gas pipelines, saying a lack of capacity results in lower gas prices for area producers.
In May, Ritter wrote to congressional leaders to ask them to reconsider ending a tax break for the oil and gas industry, saying it could discourage energy development. His administration is also applying for a $10 million federal grant to expand use of compressed natural gas for transportation fuel in Colorado.
Ritter said during his speech Thursday that he has asked U.S. Rep. Diana DeGette, a Democrat from Denver, to consider a comprehensive study of the drilling technique hydraulic fracturing before "jumping directly to a new and potentially intrusive regulatory program."
DeGette has introduced a bill that would regulate hydraulic fracturing, also called "fracking," under the federal Safe Drinking Water Act. The 2005 energy bill exempted the process from regulation under that law.
The process involves injecting liquids, sand and chemicals underground to force open channels in tight sand and rock formations so that oil and gas will flow. Landowners and groups supporting DeGette's bill say fracking threatens groundwater, a claim industry groups dismiss as unsubstantiated.
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