DENVER (CBS4) – Colorado is the fifth largest crude oil producer in the country, and yet despite increased demand, oil production here is down. The industry is blaming a lack of political will to develop energy here and is warning the implications are significant for the economy, the environment and national security.
Last month, the average price at the pump in Colorado was $3.34. In 30 days, it’s gone up 60 cents. If you drive to the mountains, you’re sure to find it above $4.
As the price at the pump hits a record high, the Biden administration is turning to countries like Iran, Venezuela and Saudi Arabia for help instead of tapping producers here in Colorado.
Dan Haley, CEO of the Colorado Oil and Gas Association, says, “We want to be a part of the solution, and we want to get people back to work and drilling.”
Haley says U.S. reliance on Russian oil and gas increased in the lead up to the war, with record imports last summer, even as production in Colorado has dropped 30% in the last two years.
“We need to decide as a country where we get our energy from. Do we want to get it from Russia? A hostile country that takes over other countries? Do we want to get it from Venezuela? A country we already put sanctions on? Do we want to get it from Iran? Saudi Arabia that doesn’t have environmental protections, labor standards or human rights standards that we have? Or do we want to develop in Colorado in this country using local workers under the toughest environmental standards in the world?”
While other states have now started to ramp-up production, a University of Colorado study found a state law passed in 2019, that tightened regulations, has helped slow investment and recovery here. Researchers noted oil and gas companies are pulling their regional headquarters out of the state due in part to the regulations, that have slowed permitting.
The industry averaged 30 permits a month before the law. Last year, it received five permits and, Haley says, there are more than 30 awaiting approval right now.
“We understand the need to meet a high standard in the state. We’re just asking for a quicker review process.”
Even if the state expedites permits, Haley says, it will take at least 3 months for operators to ramp up production. The industry shed 9,000 jobs over the last two years.
He admits Colorado can’t solve the global oil shortage, but he says 30 permits translates into thousands of barrels of oil a day, which would help.
“These are pocketbook issues. They hit you in the pocketbook and you feel the pain at pump, but think where we are geopolitical implications of this and being beholden to foreign countries for our energy.”