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Shell water rights opponents band together

STEAMBOAT PILOT & TODAY

County signs common interest agreement with towns, water district

 — Routt County, the Upper Yampa Water Conservancy District and the towns of Oak Creek and Yampa will pool their resources in opposing Shell Oil’s application to take 375 cubic feet of water per second from the Yampa River west of Craig.

The Routt County Board of Commissioners approved the “common interest agreement” Tuesday. The others also are expected to approve the agreement if they haven’t already, County Commissioner Nancy Stahoviak said. The entities are among 25 groups that have logged oppositions against the application filed by Shell Frontier Oil and Gas in water court in Steamboat Springs in late December 2008.

The agreement will allow the agencies to share confidential information and attorney work product “in a way that has been recognized by the courts as protected,” Routt County Attorney John Merrill said.

Shell says it needs the water to support a future oil shale industry. A study released re cently by Western Resource Advocates — a Boulder envi ronmental law center that opposes the development of oil shale resources — warns that water for oil shale will stress limited resources, come at the expense of water currently involved in agricultural uses and forever change wes tern Colorado’s “economies, communities and ways of life.” The debate is expected to continue for a long time to come.

“I wouldn’t be surprised if this case is still on (Colorado Water Division 6) Judge (Michael) O’Hara’s books in two years, maybe even three,” said Erin Light, Division 6 water engineer for the Colorado Department of Natural Resources.

O’Hara referred the case to Division 6 Water Referee Dan Birch to consult with Shell and its opponents and make a recommendation to the court. On March 2, however, Birch recused himself from the case because of his affiliation with the Upper Yampa Water Conservancy District and the Colorado River Water Con servation District, which also filed a statement of opposition.

Water lawyers and other officials interviewed this week said O’Hara will have broad latitude to either appoint another referee, perform the referee functions himself or skip that step and put the application on a trial track; they said that decision likely will be influenced by what Shell and the other parties want to do. Both opponents and a Shell official said they do not want to see the application put on a trial track just yet.

“Nobody wants that,” County Commissioner Doug Monger said. “We’re not really in trial mode yet.”

Shell spokesman Tracy Boyd agreed.“I think, given the choices, we’d prefer to have it referred to someone else in a referee function rather than go to trial,” he said. “Generally speaking, we’d rather work with interested parties rather than work with a trial scenario. … We’re more interested in contacting all the entities and getting a better understanding of what their concerns are.”

‘Enormous implications’

Light noted that there is no designated alternate referee and said she expects O’Hara to serve in that role. She also expects O’Hara to schedule a status conference with Shell and its opponents in the next 30 to 60 days.

“The entire case is before him now,” Light said. “It’s exactly the same process, except Judge O’Hara is doing everything.”

The 25 statements of opposition enumerate a number of different concerns with Shell’s request. The city of Steamboat Springs argues that its water rights in the Yampa River Basin “may be adversely impacted if the subject application is granted without adequate protective terms and conditions.”

“The city is going to have need for additional water rights and augmentation plans in the future,” said Glenn Porzak, a Boulder water attorney representing the city.

In its statement, Routt County argues that, if approved, the diversion seriously would hinder the development of water resources for the unincorporated South Routt County community of Phippsburg, whose public water system is operated by the county. The county also states the diversion would impair the development of water resources for agricultural uses and would have a serious negative impact on its ability to finance and develop future water projects.

Across the board, statements of opposition also say that Shell has yet to prove its need for the water, that the claimed rights are not speculative, and the feasibility of its project, which includes a 45,000-acre-foot reservoir.

“There’s going to be a huge test of can and will on this water right application,” Monger said.

Some of the most strongly worded statements come from Steamboat attorney Tom Sharp on behalf of the Mount Werner and Morrison Creek Metro politan water and sanitation districts. In the statements, Sharp alleges outright that the application is “based upon the speculative sale or transfer” of the rights and that the water re­quested is excessive and wasteful.

Many of the arguments in the statements of opposition are in line with the findings in the Western Resource Advocates study. That group describes commercial oil shale development as an unproven technology that could require as many as four barrels of water for each barrel of oil produced from shale. The study quotes Gov. Bill Ritter’s 2008 statement that “the development would constitute the largest industrial development in the state’s history — with enormous implications for all of Northwest Colorado and for the state itself.”

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