SIGNED! Fenberg Bill to Prevent Forced Mineral Development Becomes Law

Fenberg: “This bill creates guardrails that will allow local governments to decide for themselves whether their mineral holdings will be developed or not.”

DENVER, CO – Legislation sponsored by Senate President Steve Fenberg, D-Boulder, that bolsters the rights of mineral owners, especially local governments, by putting protections around “forced pooling” orders was signed into law today. Forced pooling is the “mandatory consolidation of leased and unleased minerals to access one common underground mineral reserve.”

SB24-185 ensures publicly-owned minerals aren’t developed against the will of local governments. For forced pools of privately owned oil and gas, it promotes transparency around the process for proving that oil and gas operators own or control the requisite 45 percent of the mineral rights within a drilling unit in order to force pool the remaining minerals in the unit.

“Many local governments in Colorado own minerals that have been purchased with public funds, and because of our ‘forced pooling’ law, our communities have been forced to develop those minerals against their will and without their consent,” Fenberg said. “This bill creates guardrails that will allow local governments to decide for themselves whether their mineral holdings will be developed or not.”

Prior law required oil and gas operators to own or control 45 percent of the mineral rights within a drilling unit in order to force pool others’ minerals, but it did not require operators to submit sufficient evidence of their proportion of ownership or control. SB24-185 requires operators to provide a list of the public leases that make up the 45 percent threshold. 

The new law also prevents drilling from starting until a force pooling order has been issued, which ensures the 45 percent mineral right threshold has been met before extraction begins.