All right, we're gonna get started.

I've been a call to order the town council special meeting on April twenty first, twenty twenty six.

Will you please rise and join me in the Pledge of Allegiance?

Liberty and Justice.

Mayor Pro Tem Bell.

Here.

Uh Councilmember Baer.

Present.

Council Member Mortalero.

Here.

Uh May uh sorry.

Councilmember Pestamarelli.

President.

Councilmember O'Connor.

Present.

Councilmember Hoback.

Councilmember Mortalero.

Here.

And Mayor Moore.

Here.

Mayor you have a quorum.

All right.

Thank you.

We'll see if we have a motion to approve the agenda tonight.

So moved.

Second.

All in favor say aye.

Aye.

Aye.

All opposed say no.

All right.

We have an agenda and we have one item on the agenda tonight, and that is an informational item for the potential sale of the town's mineral rights.

There will be public comment after that.

Normally we do public comment before items on the agenda, but we're going to reverse it tonight so we can get this information out.

All right.

Uh, and tonight we're gonna have an informational meeting uh about the potential sale of uh portion of the town's mineral rights.

Um this is just informational.

There is uh no decisions being made tonight.

Uh and I need to stress that uh though uh broad uh broad terms uh are are in place, negotiations are still uh underway.

And so because of the nature of that, there may be some information that that we can't disclose tonight, but there will be, assuming that a deal is brought before this council, uh, another public hearing, another meeting, um, where uh information that's unavailable tonight will be shared uh with this council and with the public.

Oops.

Uh so a quick agenda.

Uh I want to talk about where we where we are.

Um and and a really brief where we're going.

Um, the policy decisions uh that are at stake here.

What the next steps are uh where we're where we're going.

Uh then of course the the real reason we're here for public comments, um and then we'll we'll wrap this up.

Uh I will say staff intends to be extremely brief tonight because the the point of this meeting uh is is to hear from the public and to give the public space to speak.

So uh those that have been following along uh following an initial hearing in November 2024, which was continued uh until March 2025.

Uh ECMC, the state of Colorado uh Energy and Carbon Management Commission approved the Draco pad.

That was for 26 wells that are located uh near uh north of the landfill near the the westerly development uh off of County Road 7.

That site is in unincorporated Weld County.

Um those that have followed the process knows that uh Erie, though not the local government uh with relevant land use authority um did participate actively in the Weld County process and the state process.

Uh in the last spring, um there began talks about about uh uh acquiring the town mineral rights either through lease or sale.

Um so this has been an ongoing process for for about a year now.

Uh and any decisions, uh, of course, what to do with town property, which would include mineral rights, uh, is a policy decision for for this council.

And again, just to stress to everybody, no agreement uh has been reached or any decisions made, and that's not what's happening tonight.

Oops.

Sorry, I'm a little quick on the on the draw here.

So uh just to kind of orient ourselves uh where where we're talking about.

So, as I said, uh north of the landfill, uh, near westerly, uh, is where the Draco facility uh will be built.

That is north of the what's called the liquid handling hub.

So if you've ever driven down County Road 7, you need to see the the gigantic white tanks out there.

That is a uh a facility where regionally oil and gas wells report fluids to uh and then they're distributed from there for refining.

Um that facility will be drilling uh over four miles to the west to nearly uh highway 287.

That's what you see on the the very far left of this of this map is highway 287.

Uh and the the blue or the purplish box here uh shown is what's called the spacing unit uh being proposed for Draco.

There is a spacing unit that was that was approved with the oil and gas development plan in March.

This one is very slightly modified from that, basically shaving that last uh quarter mile um off of the western edge.

Uh this is currently under review by ECMC um and no decision has been reached on this amended spacing unit.

Um, but I I fully expect them to adopt this to be the area of production uh for Draco.

So this includes production under you know portions of uh Vista Point, uh Erie Commons, uh Baxter Farms, uh Canyon Creek, um basically the neighborhoods with within this map here.

So to just give you kind of a sense.

This production is from uh very great depth, mile mile and a half down.

Uh the units being targeted are between 7500 and 8,000 feet uh below the surface.

So if you imagine they're gonna drill sort of diagonally down from Draco, splaying out in a fan, and then across this area.

So some questions that have come up, and I think these are the most pointient ones.

Um so what happens if the town decides not to sell its minerals?

Um as people are aware, uh there was a Senate bill uh in 2024 that uh states that municipally or local government owned minerals within the boundaries of that local government are not subject to to forced pooling.

Um normally the process uh for a mineral owner is um if your mineral interest is within the spacing unit, uh you're you are approached um and offered lease or sale, um, you're free to negotiate that, accept it, decline it, whatever you'd like to do.

If you do decline the those terms, um then they have made you a good faith offer.

And provided that they can establish that they control 45% of the minerals within that spacing unit, they can pool the rest of the minerals in forcibly, uh, under terms that are dictated by Colorado statute.

Municipal governor or local governments are exempt from that forced pooling uh provision.

So if the town were to not sell, we do we do no deal at all.

Um we do have mineral rights, which are under the current subject of lease.

Um those already leased minerals would be produced per the terms of those leases.

Um those leases can't just be broken willy-nilly uh as long as all parties are abiding.

And we would receive whatever royalty payments are outlined within those individual leases.

Um the majority of those leases were tied to the land when the land was deeded to the town.

Um there were some that the town uh elected to lease uh after the fact.

I think the last lease that was signed was in like 2012.

So none recently, but this is um something that the town has done uh on again and off again uh throughout history.

The unleashed portions, of course, could not be forcibly pooled.

And the unleashed portions were we're not talking about a huge amount, it's uh something like three and a half percent of of this entire area.

Um but it but it does have have an impact.

Uh so can the town's minerals be avoided if they're in in this area, if they're in line to be drilled.

And the simple reading if you read the statute is that they must be avoided unless they are leased uh purchased or voluntarily pooled.

Now, what avoided means we don't know at this point.

We are in somewhat uncharted territory in that this provision passed by the Colorado uh legislature in 2024 is a bit untested.

Brina, do you want to did you want to speak for a moment on the actual uh I won't say details.

Could we go back a few slides, please?

Sorry in your excitement to get to the map.

Of course.

So there is an agreement that is still being negotiated between uh Erie and Civitas or uh SM.

There are some uh broad pieces that I'll bring forward tonight, but uh like all negotiations, this is not final until there is an agreement on a council agenda.

Meaning anything that we might talk about tonight may still change.

Um and but broad strokes, we are looking at some additional safety measures.

We're looking at plugging and abandoning 16 or 17 wells.

Those are in addition, excuse me, in addition to the ECMC's March 26, 2025 order to plug and abandon.

There is some additional oversight that we've negotiated, monthly inspections.

If there's a safety concern, we will be able to report that to the ECMC.

And then additional compensation.

Uh, we're looking at three parcels out by county line road.

We're looking at production revenue, meaning a percentage of the production would be um remitted to the town and then a cash payment, roughly four and a half million dollars.

At this point, there is no agreement that is final.

There is nothing um that is available public because we are still in the negotiation phase, which brings us to next steps.

So, in terms of next steps, if there is an agreement, it would come forward for council.

Nothing could happen without council approval.

It would have to be in public at a public meeting, and then council would have vote either to affirm the agreement or to reject the agreement.

If there is no deal that is reached, then um there would be nothing to bring forward because there would be no minerals that would be sold or leased by the town.

And then um anything that uh would be available uh that would be public would be part of that public meeting on a future date.

No decision is happening tonight.

Yeah, and I want to stress that prior to that meeting, um it is certainly staff's intention to share much more information, detailed maps, etc.

Um while negotiations are underway.

I I don't think it's appropriate to share those things.

Um and I also think it's important to note that when the state of Colorado approved Draco in March 2025, they approved a facility to drill up to and including 26 wells.

I would fully expect, no matter what action the town takes, that 26 wells will be drilled at Draco.

The exact nature of what what units may be spaced, what what areas will be produced, that is not something the town knows or could know until that path is ventured down.

But I I'm under no delusions that uh that Draco will not go forward with with 26 laterals.

Okay, that concludes the presentation.

Um let's see, council's gonna have two opportunities to talk tonight.

One is right now if they have any clarifying questions to what's just been shared.

Um, and then at the end of public comment, we'll also have a chance for council to ask any clarifying questions.

Um councilmember Baer, and this often happens, we'll start with you and we'll just work our way around.

Great.

Thank you for the presentation and thank you everyone for coming out.

Um so we can all operate hopefully on a on a level set of information and understanding.

Um Brina, I guess my question is for you.

You mentioned an additional 16 to 17 wells and it on top of the 22 wells that are included in the conditions of approval for Draco with the state.

Um the conditions of approval are above and beyond the floor that the state has for um safety measures that must be met.

Um so the additional I I see here are middle schoolers all over town going 16, 17 uh wells.

But I'm disappointed I didn't think of that one.

My middle schooler will be disappointed in me as well.

Well um so then gold star for me.

Um so in addition, but it's my understanding that those 16 or 17 wells um will be plugged and abandoned out of necessity, but what we're um talking about really is an expedited process.

I think that's accurate, yes.

Okay.

Um thank you.

I just wanted to clarify that.

And then uh the additional monitoring.

Um there is a floor of safety and monitoring that occurs and happens, and part of the approval criteria that a condition of approval was that the town would or there would be air quality monitoring surrounding the pad.

So this would be different than that.

Potentially.

Um that pad, my understanding, I'm looking to Mr.

Frank, is not located in the town's boundaries.

So we would not have jurisdiction over anything that would happen, obviously outside of our our boundaries.

This would be getting us uh right to come onto monthly um uh to do an inspection outside of our boundaries.

Rather than asking permission um yeah, so we we currently don't have a right to inspect facilities which are outside of Erie, um, beyond like you said asking and hoping for the best.

This would this would codify our ability to inspect that site.

Um we just actually finished our first quarterly inspection uh of our inspection program.

Um very excited.

Uh we've already inspected every facility in in town.

Um this is obviously a big one that would be outside of town and and having access.

Obviously, the state would do its its routine inspections as well as Weld County, but I think it's pretty critical that the town um also be able to inspect the site.

Um if you read the report, we found a few things that the state had missed uh at other locations.

Okay, thank you.

Those are my questions.

All right, thanks, Councilmember Mortalero.

All right, uh thank you.

And you know, thanks everybody for coming out.

Uh and and David and Brina for all your work uh on this.

I just have uh a couple questions.

Obviously, we've been talking about this for a little bit.

Um you said that they're looking at uh not going all the way out to 287, stopping short of that.

What what um is there a reasoning behind that or the there was no reason listed in the the amended application?

Okay, uh simply that they they want this configuration rather than that.

I don't really want to speculate because I don't know.

Okay, thanks.

Um and then uh one of the things that you you brought up the ECMC uh were the there were six wells that you were concerned about that were plugged in and abandoned already.

Um you got agreement uh to that they would test the soil before and after the drilling operations um for those wells.

Um would you also add those to your quarterly inspection with your uh imaging uh to make sure there's no gas leaks?

Um so it's a it's a larger question than it appears on the surface.

Uh no pun intended.

Uh when you have a plugged in abandoned well that's leaking, you may have methane in the soil, but you're not gonna have uh detectable amounts of methane.

You're not gonna be able to see that at the surface with an OGI camera.

Okay.

We we are hopeful that um this summer we plan to begin a pilot program to investigate plugged in abandoned wells to collect uh soil vapor samples.

Um depending on how that pilot program goes, we're gonna bring to council the proposal to do to test every well we can get access to in town.

Um the a hundred and some uh plugged and abandoned wells.

That's gonna be a big lift and isn't directly related to this, other than um these six, which are a condition of the state's permit and and will have to be done regardless of what action council takes on this matter.

Okay.

Great.

And you also mentioned at the uh the town hall meeting about the air monitoring.

We're not just relying on SM or the state to do the air monitoring.

We have our own equipment, we have one stationary and five mobile one.

So yes, so um the the state's requirements for air quality monitoring, both what they what the state provides and what the operator is is required to provide is through the duration of of pre-production activities.

That's the the construction, drilling, hydraulic fracturing, flowback.

Uh and then for a period of not less than six months after the initiation of production.

That's the most volatile time for an oil and gas facility.

That's not to say that's the only time you can have emissions.

So after that six month period, neither the state nor the operator is required to continue doing that air quality monitoring.

And so that's that is why it's critical that uh that the town deploy one of its polar air satellite stations as as near as is feasible.

Um and we're working with uh the westerly developer to figure out where's the most appropriate place um between that development and this facility uh to put that location.

Obviously, with construction ongoing out there, we need to be able to access the site.

So we're just trying to work out the details on where exactly that thing's gonna go.

Uh but we will have that deployed prior to construction.

Okay.

Great.

Thank you.

All right, Councilmember Hobak.

Uh thank you.

I have a number of questions about the process that got us to the point that we're actually negotiating a contract.

And to my recollection, my notes, um, council found out about this offer in September.

This presentation is the first I've seen that uh we were contacted in the spring of 2025.

So can you tell us who it was that contacted the town about our built mineral rights and uh who they first contacted?

I believe trying to remember back, this is quite a while ago now.

The the initial phases of this were um our economic director, uh Julian Jacqueline, uh came to me and said, Do you know who this 7N company is?

Um we're we'd like to approach them with a with a cash offer for for this parcel of land along County Line Road.

I said, Yes, 7N is a division of uh at the time Civitas now SM Energy.

And I said, uh, if you're interested in in purchasing land from this company, here are some contacts for you to call.

Um he then reached back out and said, Well, we we actually had a brief meeting with them where they said um we made them a cash offer uh slightly above uh appraised value.

They said, no, we're we won't sell our land.

Um, but we would we would exchange it for some town mineral rights, and that's that's what initiated the conversation.

Um at the time um it really didn't appear we were talking about a single parcel um that that was an equitable exchange uh and it took quite a while for it to develop to the point where like okay, this might actually be a serious offer, uh and that's when we brought it to council.

Okay, that makes sense.

And how did Comp similar question how did the contact come about with Matt Owens of Alamanda Minerals?

Uh I think it was in September after that after that meeting.

Um Mayor Moore sent me an email and said uh here's some contact information from a gentleman.

Um I think it would be a good idea, good idea to reach out to him and hear him out.

Um I gave him a call.

Uh he gave me his pitch.

Uh I said that's that's a in that's intriguing.

Um certainly he's got a lot of uh industry knowledge.

He he knows how these things work.

Um essentially what Alameda Minerals um they act as a real estate broker for private mineral holders.

Normally, um, and maybe maybe some folks uh in this audience, certainly folks across town, when you're approached with a mineral lease offer, you read it and you go, boy, I don't I have no idea what this what this says.

There's not a lot of resources.

Um typically you go hire an attorney uh to say what what is this?

Should I sign it?

Um is the first question.

Is this is this a fair deal?

What is the market value of these minerals?

Um and that's sort of the service that he was offering.

So I said, draft us a proposal, um, we'll bring that to council, we'll we'll consider a contract.

Okay.

Um was there any discussion, and uh I know council didn't give direction to um issuing an RFP or some sort of a committee competitive brid for this?

No, there was there wasn't an RFP process.

Um I'm I'm not aware of any other companies that do this exact work.

Um so you mentioned three and a half percent of the land, I guess, within the Draco area.

How do you come up with that?

I've seen I think as Mayor Moore's post on the internet was 2.8%.

We haven't seen any maps.

Residents have any seen any maps that go to that kind of detail.

How close do we are we to knowing how much we're really gonna sell?

I might turn to the town attorney.

That's what exactly we're talking about here is uh still being talked about.

It is still being talked about.

Um we are in the process of identifying the minerals that we do own with a title company and a landman, and so that that process is still undergoing, and I suspect that's why you're hearing different numbers is because we're trying to figure out what exactly we do own and going back in in um in some cases uh a number of years to figure out what title ha who had and transferred to whom at what point we're talking like union Pacific deeds from like the 1870s.

Okay, yeah, no, I riveting riveting reading in in like fancy cursive.

So that number may have changed from two and a half eight two point eight percent to three and a half percent and i yes, depending on again, we're tracing the ownership, which um as you can imagine takes a minute.

Okay.

Have we been in touch with in contact with any other companies or individuals in the last 12 months about selling our mineral rights?

We received a number of unsolicited lease offers.

And is there a reason those have not been brought brought to council?

Frankly, they're um of nowhere near the quality of this offer.

Uh frankly, exponentially.

Um they're pretty standard uh lease terms uh as far as um yeah, royalty interest um that yeah, order orders of magnitude.

Okay.

Um so maps and precise precision aside.

I know we can't talk that to make generalities um for all of us.

Is it safe to say that short of a few outliers, some things that are already leased and and that sort of thing.

What Erie owns are the mineral rights underneath ERE properties?

Facilities, streets, parks, open space, random commercial lots.

Is that an accurate statement?

I think that's accurate.

By and large, yes.

Um occasionally, depending on when title was transferred.

Sometimes the title only is the surface, the the top, and the mineral rights have been severed.

But generally speaking, yes, we own the the rights underneath our parcels and properties.

Okay.

Um subsurface trespassing is no.

Okay.

Maybe I can later.

Yeah, I mean, it it it is it is what it what it sounds like.

Um the the nuance of what constitutes trespass, uh, even on the surface is uh their differing opinions.

Uh if you've ever if you've ever gone to court for a for a case like that, um when someone is trespassing and in what nature what constitutes trespass is the is the difficult part of that question.

And I'm not a lawyer.

Thank you very much.

No more questions.

All right, come around, Councilmember Pastor Amelli.

Thank you.

Uh had one question.

So does Draco have to start and finish in the timeline?

Yeah, so uh as part of the oil and gas development plan approval, um when that when that hearing was being scheduled, uh obviously interested persons can petition um for affected party status.

Uh one party who did so was the adjacent landowner, um the westerly development by a Southern Land Company.

A negotiated uh settlement, if you will, was reached between uh Southern Land as a company and and Civitas now, SM Energy.

And one provision of that was a a truncated occupation for this pre-production activity.

Um initially that agreement was two years from when the permit would be granted, which was expected to be at that time October 2024.

Sorry, not two years, three years.

Um and of course, since it was delayed that hit the until early uh 2025, what's in the agreement, what's in the oil and gas development plan is May of 2028.

However, the I would encourage anyone to go listen to the to those couple of ECMC hearings.

The ECMC commissioners made it very clear that all efforts possible must be made to have all of the wells finished and in production by October of 2027.

So that is not a hard deadline.

It is May 2028, is the hard deadline, but the commission was very clear that the target for the end of pre-production should be October of 2027.

So delaying or moving the project with this leasing or selling of the minerals, would it have any effect on Draco implementation?

Is there any chance?

I don't know their precise development timeline.

Um obviously they haven't started construction.

Um yes, I mean there is it's a it's a tight window to drill 26 wells in this amount of time.

The reason why I'm asking is there was a lot of urgency and there was a lot of pushing, there was a lot of uh you know, make it fast kind of thing which happened in this deal, which makes me think why it's being so rushed.

And even all the uh negotiations I mean were just pushed is what I felt.

So that's why I'm asking is is there a reason for them to finish that so that the Draco project wouldn't be affected?

I I'm sure internally they certainly have a date on the calendar whereby they're like we we have to have earth movers out there.

We have to start we have to have drill rigs mobilized by this date in order to meet those those committed timelines.

I I have no idea what those dates are.

I can do my own math on on how long I think it takes to drill and frack a well and say it's probably soon.

Uh it's gotta be if not if not this spring, this summer, um, where they're gonna have to make a decision point uh on on whether they move forward with our minerals or without.

At some point they have to call for a pooling hearing with ECMC, and they'll need to know what minerals they're trying to pool, what minerals they own, and what minerals they need to exclude.

So will the minerals that we sell give them any leverage or anything.

So the the town has a lot of very unique leverage right now.

In that since our mineral interests that are unleashed can't be pooled, the only way to acquire them is through direct negotiations with us.

However, at some point, the company will need to move forward, and then we'll have no leverage.

We'll we'll just be out.

They'll say we're going with plan B.

That doesn't include Erie, and that's what we're doing.

And also the fee 4.7 million, is that standard or I don't know what's standard.

This is a this is uh an odd space.

This circumstance has only existed since January 1, 2025, when that legislation came into effect.

So if we don't sell, we don't pay anything?

Yes, the so the the fee to alumina minerals is not uh four and a half million.

It is seven and a half percent of whatever whatever is gained by the town not to exceed four and a half million.

So another last clarification was uh last time Mayor Protam on record said that the contact mat was bought by the council sorry, by the staff to the council.

Today I'm hearing a different one.

No, it was I'll clarify that.

Um the CEO of Alameda Minerals reached out to me.

I immediately just sent his contact information over to uh Mr.

Franks.

Um the email is very short.

I just it's like his LinkedIn uh profile and his phone number and his email.

I think that's the entire contents of that email.

Subsequent to that, he reached out to me for the contact information for the mayor of Frederick.

Um so this is what he does.

This is his deal.

But I wasn't involved with the negotiations or uh the contract in any way.

It was simply getting the information over to staff, correct?

The reason why I'm asking is uh Mayor Protam last time he said staff brought the contact to us.

But here it is a different version.

But I wasn't aware.

So what you said was understanding you don't know, but you said something or I that was an assumption.

His contact was through David Frank.

Uh turned out reached out to the mayor before the mayor passed on the contact declaration to David Frank.

So it was understanding.

That's all.

Okay, Councilmember O'Connor.

Thank you.

So if we don't lease or sell the mineral rights, they must um they must avoid them.

But does that mean like I you I had sent in a question regarding that uh a couple weeks ago, and the first understanding was that they were going to completely just steer around the mineral rights, but there's also at least another way that they can do that and still avoid it, but possibly go through our mineral rights.

I I hate to speculate.

I I don't know what they will propose.

Okay.

Um I don't know what the state would be amenable to accepting, and I don't know what the town would object to should the state make a ruling that uh isn't in our interest.

But they but one um one option that they could try to push forward is to go through our mineral rights, but not perforate the pipe and I mean if we let's let's talk let's set aside legalities and state statute and ECMC rules because there's a lot of nuance there.

You could physically avoid uh producing a section of a lateral.

There's there's casing, steel casing driven all the way down the hole, all five miles of it.

And then in stages from the tow, you work backwards, you will set a packer, you will perforate the casing with small explosives, and then pressurize that section of casing to hydraulically fracture the rock.

And then you then you move back and you do the next segment.

If you if you didn't do a portion of the casing, you would have solid steel casing and no way to draw oil into the pipe from that section.

So it's physically possible, certainly.

Um whether that relates back to the question of mineral trespass, I'm not a lawyer, and I don't know what the state how how the state would would approach something like that.

You could also simply um geosteer your your boreholes in a way to just avoid those areas as well.

That's another way to physically uh avoid production from a certain from a certain area or parcel.

But we just we don't know until that I think you had mentioned that until they um do a form two submittal that we wouldn't know if they were going to attempt to go through our mineral rights or not.

Correct.

The form two is an application for permit to drill, and that's when that's when uh you propose to the state of Colorado, this is precisely the alignment that we intend to drill.

Um this is where our boring is is going to go, and this is the the pressures at which we're gonna frack, these are the intervals that we're going to perforate, etc.

And so yeah, until that application goes to the state we're we're completely speculating on on what any given operator would do with any given borehole.

And and if they do get that method through where they go through our mineral rights, that pretty much interrupts our mineral rights that if we ever wanted to pursue it in the future, or how much would it interrupt if if the town ever decided to pursue it in the future?

So yes, so part of the review of uh of a form two uh is is conflict.

Um are you gonna potentially drill into somebody else's well?

Um and so you you have to avoid uh existing existing borings, existing laterals.

Um yeah, if they were to drill straight through uh our our property, it'd be pretty difficult to then locate a well back into that.

Yes.

Okay.

Thank you.

Okay, Mayor Protein.

Thank you.

Um some of those questions I think were answered.

Uh I I guess elaborating on what you just said there.

Can you talk a little bit about what you mean by geostering and what that looks like?

Nobody knows what that looks like.

It happens 7500 feet down.

No, um essentially you it's a so a modern a modern drill bit's a pretty complex thing.

Um and you essentially use uh differential fluid pressure on one side of the bit or the other to to push it left, right, up, down uh and you're and you're recording real time um what where it is, what direction it's going and making constant corrections.

Um yeah, modern drilling is a is a pretty engineered and remarkable thing.

Um the fact that you can go down a mile and a half and then stay within a you know 30 foot wide piece of rock um and end up where you intended is is pretty amazing.

Um it's been going on for 20, 30 years.

It's a it's a pretty sound and and tested science.

Thank you.

So going back to what you had said at the outset about you you uh fully expect that there will be 26 wells that will be drilled at at Draco.

So with the geostering, so um if there's not a an agreement reached and uh uh SM has to go back to ECMC to exclude the town's mineral rights in the drilling and spacing unit, theoretically, they can reach the minerals that they would need to while I I mean I know I know we don't know what that exactly looks like, but um we don't.

The stat the statute says we can't be pooled, it does not say we can't be spaced.

Okay.

So the the town's unleashed minerals could certainly be part of a spacing unit as long as they're not.

They're not produced, okay.

Whether they would drill all 26 into the the currently proposed spacing unit or drill north or to the south, there are other uh unproduced minerals um in various parts of Erie that could certainly be reached from Draco.

Okay, okay.

Um screen turn over.

Um for the property, and I can want to see what we can and can't are are we allowed to talk about the parcels that may be potentially part of this or I think so with the understanding that that may change depending on how we get to a where we get to in our formal negotiation.

Okay.

Can we talk about the three parcels and why they are of interest to the town?

Whoever, whoever is okay with the answer.

I think I think broadly we can say that they're they're along County Line Road Um, south of Bennell and north of the airport.

Okay.

Um I think if you look at that those large undeveloped fields, uh more or less in the center of town, you can it doesn't take a lot to see why the town would be interested in not just development along county line, but why the town would be interested in being in the driver's seat of what sort of development occurs.

Um I could elaborate, but I think I think that's I think it's fair uh and apparent.

Um so we've talked a little bit about Alameda Minerals, but in addition to that, uh for the public, um we have uh in it in addition to Burrito, we have oil and gas council, right?

That we employ.

And can we say they've been uh have they been involved in this process?

Can we have been involved at um at nearly every step in the process?

Okay, thank you.

Umvoices, they've been heavily I can imagine um is in your working with them, and I guess you always speak to you has Alameda Minerals uh negotiated in any way that you feel is is in conflict with the town, or have they generally um uh uh uh advocated for the town's interests?

Yeah, I mean the nature of the contract is if if we get nothing, Alameda gets nothing, right?

It's a it's a pure percentage base.

Um so obviously uh Alameda's motivation is to maximize the return to the town.

That maximizes their their cut of it.

Um and that's that's the only thing I've seen is um that Alameda has uh pressed very hard um to maximize return for the town of Erie.

Okay, thank you.

Um speak to a little bit um the questions I've seen online is uh why are we looking to sell these versus lease these?

Uh can you talk about as far as uh the uh the production revenue, why um is is there a benefit over the other, or is that uh yes um typically if I were a uh private mineral holder and I was considering what to do with my mineral estate, generally the preference of lease versus sale is is do you want money up front today um or would you like money over time, uh a cut of the production proceeds?

Or would you like money over time?

A cut of the production proceeds.

As a private mineral owner, it's often very much in your interest to take the longer cut for a couple of reasons.

Primarily of which is tax-based.

If you get a huge bunch of money in one year, you get taxed to high heaven.

That is, that takes your income and it skyrockets it several brackets.

Whereas if you spread that out over a 20-year term, your overall taxation burden will be much less.

So that that's not as much a consideration.

So from the town's perspective, lease versus sale is much less a distinct one.

And it basically came down in back and forth negotiations that we were going to see a lot more through a sale than we were through a lease.

Basically, the the lease terms were simply not near as favorable.

So that's the that's the direction the negotiations took.

Thank you.

That's all I have.

All right, I have a couple questions.

Water uh comes up.

Um fracking is known to use a lot of walk water.

Um there have been comments made that Erie is providing the raw water.

Can you please address that particular topic?

No, I don't I want to speak for uh utilities director Todd Fessenden, but um the the town has not sold water uh for the purposes of hydraulic fracturing and and would not.

Um we view it as a very precious resource.

Um it's it's uh it's expensive enough uh as it is, let alone to open up some sort of bidding war on our on our municipal water.

All right.

And then on the wastewater side, um, as they're doing the drilling, how do they protect against our our water tables and just keeping everything underground uh from getting contaminated?

Sure.

So so one thing to note is that um Erie doesn't source its its municipal water from from groundwater supplies.

Um so we can talk broadly about aquifer protection, but that is a sort of a separate subject from from protecting the town's water interests.

I just want to make that that distinction.

Um when an oil and gas well is drilled, um it's drilled sort of in stages, uh like telescoping stages.

The the initial hole is quite large.

Um and it goes from the surface all the way down through any viable aquifer.

And in this area, that's gonna be to the top of the of the uh ancient Cretaceous shale that's here.

And then there's about a mile of shale, and none of that has any potable water anywhere in it.

But all of those upper units, from the alluvial stuff down through all of the sandstones, they run large steel casing, which is then cemented in place.

So there's cement between the casing and the borehole, and then that is logged with a what's what's called a sonic bond log.

It's basically an ultrasound, same exact same technology, where you look through the casing to see if there's any voids in the cement to make sure that there's solid cement bonding the casing to the to the rock, so there's no channel for for migration upwards.

And then you go inside that casing and start drilling a smaller hole, which is which is also then separately cased um down through all the shale to the production zone.

It can get more technical, but that's kind of the big picture.

Yeah, no, I think it's just the big picture that there are um there's engineering that happens to protect the water table, um, is what I wanted to make sure was out on the public record.

Um can you tell us um in Erie there's wells all over the place?

And I'm uh I want to make the assumption, but I don't know that's to be true.

I'm assuming those wells don't just go straight down, but are likely horizontal to some degree as well.

Is that a statement?

If you're if what you're looking at is um like north of Old Town, there's a there's a nice little horse field right at the bottom of Morgan Hill, and there's a large array of many, many wells in one tight configuration.

Those wells go down a mile and a half and then splay both north and south under this building.

Um they extend about two, almost two and a half miles to the north and to the south.

Those those facilities are all horizontal.

If instead you're looking at a a single well, maybe with a tank next to it, um that well will almost certainly be just a vertical hole straight down.

Between those two technologies, there was a period in the early 21st century, say 2005 through about 2015, where the what was in vogue was drilling what's called a highly deviated well.

So this is if you if you see a facility that has three or maybe five wells on it, they will will drill out almost diagonally in like a starfish pattern, but are essentially vertical wells.

Once they reach the production zone, that's the end of them.

They're just a vertical stick.

Um they don't then then splay off horizontally.

So we've got all three.

Uh lucky S.

Got it.

Okay.

And so a mile and a half deep for the ones you were talking about by Morgan Hill, so likely under Morgan Hill, I'm guessing under Old Town or Yeah, they they come under Old Town and then north up to about Highway 52.

Okay, and then south to the edge of Old Town.

Okay.

Um so right about Erie Parkway.

All right.

And are there other are there any other of these large pads that have done horizontal drilling under Erie at this point?

Certainly.

Um probably familiar with the um occidental facilities, uh Papa Joe, Mayjay, and Yellowhammer, which are all just north of uh not Erie Highlands.

Uh Collyer's Hill.

Caliers Hill.

It's too many hills.

Um now we've got Spring Hill.

Uh those are three very large facilities.

Um was it three years ago now?

Um Costlet East, which is out at Erie Erie Parkway and I-25 uh was drilled.

Um there's the south and west of that is the Badger facility.

Um there's a there's a multitude of these.

All right.

Of course, Coyote Trails.

Another one.

All right.

So Colliers Hill then, is it fair to say that's been horizontally drilled under?

Do you know?

I can pull up the map, but yes, most likely.

Okay.

And do you know if it goes across Erie Parkway to Erie Highlands?

I'm gonna have to get the map.

Okay.

I'm asking these questions because I think there's at least a narrative out there that um somebody has started that all of our housing values are gonna go down by $80,000 each.

And yet we have all this drilling already in town, and to my knowledge, we haven't seen um that impact on our housing market.

So I just want to make sure that I understand what is already here totally outside of Draco.

So yeah, Collier's Hill was was um was drilled under uh from the waste connections and the Pratt facilities just north of um Vista Ridge.

Of course, Vista Ridge uh as well as uh big portions of Anthem to the south uh were accessed from Coyote Trails back in 2017-2018.

And Anthem is south of Highway 7 in Broomfield, correct?

If you could say yes for the record, yes.

Thank you.

Yeah, and uh Erie Highlands um was accessed from the Morgan Hills pad in the northeast corner of that development.

Okay.

It's it's the vast majority of town has has been has been drilled under uh in the past decade.

So then why did why do we need Draco?

You know, if the majority of town, and if I looked at the map, maybe you can go back to the map for a second here.

Um the drilling uh area, I guess old town is to the north, is that right?

Yeah, so okay, so this is to the southwest of where the drilling is at today.

Is that right?

Yes, yeah, okay.

Okay, I think that's all the questions I have for now.

Um we'll have one more uh chance to be able to ask questions.

Um we'll move on to the public uh comment uh portion.

Mm-hmm.

Well one related last question.

So that we could can I ask one related question?

Um I'm just conscientious that I don't want to necessarily go around could it wait until we have a chance?

Yeah, sure.

Okay.

But I thought because you talked about the horizontal drilling.

Is it come clinging at a little bit?

We'll have a chance.

I'm just trying to keep the meeting moving and I don't want to open it all the way back up, knowing we're all gonna have another chance to ask our questions.

All right, it's now time for public comment.

Um please remember that public comment is not an interactive question in answer forum, but rather a time for you to state your comments on a particular item or issue, in this case, specifically about the Draco pad.

Public comment provides the opportunity to discuss items that are not in a public hearing.

This is not a public hearing and no decisions will be made tonight.

Um there's a way to sign up at the kiosk.

If you'd like to speak tonight and haven't signed up, you can uh sign up in the lobby out there.

Um let's see.

If you have a handout for us, please hand it to the town clerk.

She'll make sure that we each get a copy of it.

Um, when called upon, please state your name and your location, whether you live in Erie or not, uh, for the record.

Um, tonight public comment is going to be limited to two minutes per person.

You'll be given a 20-second uh warning.

Um at the three minute at the two-minute mark, you'll be asked to wrap up your final sentence.

We're doing two minutes because we have over 20 people that have signed up for public comment.

And um, it's okay if somebody speaks in front of you to just come up and say I agree with that person.

Um, if you'd like.

Um, all opinions are welcome.

Uh please be respectful of each speaker and to ensure everyone feels welcome to share their comments.

Please refrain from any cheering, clapping, booing, or otherwise disruptive behavior.

And with that, I'll look to our town clerk to call up our first uh speaker.

Our first speaker is Jennifer Ott, and she is on the question.

So hi.

Hi, Jennifer.

Yeah, can you hear me okay?

Yes.

Great.

Thank you for the opportunity to speak.

My name is Jennifer Ott, and I am an Erie resident in uh Boulder County.

So, first of all, I want to state uh a the Draco pad will happen, uh whether we like it or not.

So I think that what the town of Erie needs to do is take advantage of that and do what's best for our town and gain revenue from this process.

I think it would be negligent of our town council to have let's say roughly three percent in the drilling and spacing unit unleashed.

The town of minerals uh would be held hostage and they wouldn't be able to be further developed.

Horizontal drilling is the current drilling.

That's how drilling happens.

Uh, someone's not gonna come drill a vertical well for your three percent of your unleashed minerals.

So essentially, um, council member Dan was talking about subsurface trespass.

And basically, what they're gonna do is try to not uh fracture stimulate or fracking as others call it uh the rock of where our minerals are, but I highly doubt they're that good, and that they're going to be able to not drain our minerals.

So if you saw um the I drink your milkshake movie, and basically what's gonna happen is our town of minerals are going to be drained, and that's an asset to us, and it will be gone, and we will not have it, and we won't be able to drill it.

As uh Mayor Moore was saying about the value going down of homes.

I would like to counter that argument and say the value of our homes will actually go up.

There's going to be 38 to 39 wells all over Erie that are gonna get plugged and abandoned, and that land has to, by a state law, get reclaimed to its natural state.

Therefore, our values are gonna go up, and this is a positive.

And wells that would leak into soil or water are going to be these old vertical wells are getting plugged and abandoned.

So I encourage the town to move forward, lease or sell our minerals and get some value for our town residents and make Erie uh even better place to live.

Thank you for your time.

All right, thank you.

Let's work in one of the okay.

So next we have um Elizabeth Fisher.

Welcome.

See, let me get my bearings here.

Um Liz Fisher.

Live in Old Town Erie.

Uh I want to thank you for setting up this meeting to share information.

Take public comment.

From all I know, I think it's time to step away from the negotiating table.

And instead, establish policy clearly stating town-owned unleashed mineral rights are not to be leased or sold.

Erie's not up for grams.

Erie has been put under pressure, pushed around by the oil and gas industry going back many years.

We've been heavily exploited.

At one point, Erie was the most fret community in Colorado.

SM Energy's offer is a bold and aggressive move.

Should be recognized and treated as such.

Our town leaders have struggled in the past.

Just as you good people are struggling now to do the right thing.

What is the right thing?

You got to draw that line in the sand.

You have community support and the weight of Colorado law to back you up.

I'm not sure what else is needed.

I think it's the best and possibly the only solution here that restores our dignity.

Reflects our values.

Come what may.

Let us proceed with integrity intact.

Thank you very much.

All right, thank you.

Um next we have Alyssa McLean.

She's online, Debbie.

Okay.

Let me check here.

Do you want to go on to the next speaker here, and then we can come back.

I don't disappeared from both places.

So let's go to uh Tim Larson.

Tim Larson.

Tim Larson.

No.

Okay.

Next we have Cole Kelly Senamore.

Good evening, Mayor and Council.

Thank you so much for your time this evening.

My name is Cole Kelly with Finamore Craig, and I'm appearing tonight on behalf of a group of mineral rights owners within the Draco unit.

One key fact here that you guys heard about, and I would like to reiterate is that the development itself has already been approved at the state level, with the exception of the reduction that's currently pending in front of the ECMC.

The question you have before you is whether the town will participate in a way that captures value for its residents or whether it will take actions that diminish value.

Based on your own materials, the town is evaluating a transaction that could include surface land, tax-based expansion, lease consideration, and ongoing royalty revenue.

Those are not theoretical benefits.

They represent a substantial economic opportunity tied directly to the unit.

From our analysis, the total royalty stream attributable to the Erie town and mineral owners and the other owners in the Draco unit could exceed 200 million dollars over time.

Under current Colorado law, as you heard, if the town chooses not to lease its minerals, those interests must be avoided rather than developed.

That means your decision has a direct impact on whether a meaningful portion of the value is realized or permanently lost.

If the town declines to move forward, and in doing so impairs the ability of mineral owners to develop and realize the value of their property, that creates foreseeable economic harm and raises serious legal concerns, including potential claims related to property rights and interference with expected development.

Our clients are monitoring this process closely and will take appropriate steps to protect their interests if necessary.

Our clients expect their property rights to be treated with the same consideration and any other as any other class of property in this town.

We would strongly encourage you to pursue a path that captures this value, treats all stakeholders fairly, and avoids putting your residents' economic interests at unnecessary risk.

Thank you all very much.

All right, thank you.

Um Alyssa McLean does declined to be a panelist, so I'm and I did it several times.

So I'm assuming she doesn't.

Alyssa McLean declined to be a panelist.

Okay, let's see here.

Next we have Bill Jones.

Good evening.

My name is Bill Jones.

I live in Archie Glenn in Boulder County.

Good evening, I'm Bill Jones.

I live in Orchard Glen in Boulder County.

I've been a resident of Erie for 22 years.

I'm here to encourage the town to continue looking at opportunities to capitalize on this opportunity in front of us.

If we take a passive approach, we lose the opportunity to both control some of the activities of the well, and we lose the opportunity to capitalize on some of the assets the town has had.

I know the town's position has been to reduce oil and gas activity in Erie.

Those rights will never want to be developed in the current status of avoiding those continuing development of oil.

I understand there's a lot of valid concerns, but my position is that those concerns are going to be here whether the town acts or not based on what has been passed already and dictated by the state.

I respect everyone's position, but this is the only opportunity we will have to negotiate with this agreement.

I uh I think it's important for the town to be proactive, and this action is doing that.

So I thank you for your time and thank you for all of your service to the town of Erie.

All right, thank you.

The next speaker is Carol Campbell.

Well, I changed my talking points after listening to some of this stuff.

But so, Mayor and Town Council, my name is Carol Campbell, and I've been a resident of Erie residing in Morgan Hill since December of 2024.

I'm a former senior executive for the United States Environmental Protection Agency.

As such, I was responsible for the National Environmental Policy Act program in Region 8, which oversaw land decisions on federal lands, including oil and gas development.

So I'm very familiar with oil and gas development operations and consequences.

I reviewed the Draco oil and gas development plan, and there's lots of best management practices in it.

The front range already is a non-attainment for ozone, including Erie.

So the operator is supposed to carry out a lot of mitigation actions to try to keep the ozone down, and that's going to need to be monitored.

I'm glad to hear that the city is going to be monitoring even though it's outside of the city.

We're going to probably have more dangerous air quality days in Erie due to this development in the summer and early fall.

I think Erie needs to ask for dedicated staff paid for by oil and gas to monitor implementation of best management practices and air quality, additional air quality monitors related to the development of this plan.

None of the state or federal agencies will have the resources needed to pay as close attention as Erie should want in our area.

There's some concern about a conflict of interest with the town hired consultant and its previous relationship with Civitas, mainly because the consultant receives benefits if the sale of rights goes through.

I'm unclear why the town isn't looking at three options.

No action, leasing, or selling versus just selling.

Selling it is a one-time deal.

Also, why would our town and its citizens have even more of the town disrupted by the strilling and potential effects?

In conclusion, I'm for no action or leasing versus selling.

I think the town residents deserve more information on the pros and cons of those three alternatives before a decision is made.

Thank you.

All right, thank you.

Our next speaker is Julie Friday.

Good evening.

My name is Julie Friday, and I'm here on behalf of Incline Energy Partners.

They are a taxpayer to the town of Erie.

Um we believe the information presented tonight does not fully reflect the value of the proposed transaction involving the sale of Erie's mineral assets.

Based upon review of the assessor site, it appears that the three surface tracks that SM subsidiary would convey to the town of Erie roughly total about 158 acres.

Comps in this area are currently valued between 400 and 475,000 per acre, implying a service value alone of roughly 63 to 75 million dollars.

That's a meaningful benefit.

They could positively impact Erie taxpayers.

The surface tracks alone equate to Erie receiving somewhere between 17 and 1900 in value for every citizen in Erie.

Importantly, this estimate does not include the additional value from the sale of the actual mineral rights themselves, the ongoing production revenue and future ad valorum tax contributions the city would receive from this transaction.

When considering the full scope of value being conveyed, we believe this transaction represents a strong outcome for Erie.

The city has a fiduciary responsibility to act in the best interest of its residents, and based on the available data, we believe that approving this sale is consistent with that responsibility.

Thank you for your time.

All right, thank you.

Our next speaker is Dan Rassler.

I'm Dan Raisler, live in Erie, and I'm here to speak against the lease or sale of mineral rights owned by the town of Erie.

Draco's a foregone conclusion, but there's a possible consequence to Draco's fracking that may still be averted, and that is potential potential damage to homes in this area.

I bring that up because I don't know the level of risk posed by fraction fracking under the hundreds of houses built over abandoned mines in this community.

When I think about one of those mines, Lehigh, I imagine that caverns that are from five to eight feet high and just 30 to 40 feet beneath the surface.

Pillars of those miners hope were just strong enough to keep the roof from collapsing as they worked.

The coal that they mine formed not in solid rock, but in a 300-foot deep formation of alluvial deposits and unconsolidated mix of clay, silt, sand, and gravel that eroded from the Rocky Mountains.

Without knowledge of what, if any subsidence mitigation was required of site developers before permitting them to construct housing above that or other abandoned mines in this area, the question that looms is: what is the threshold of subsurface disturbance that, if exceeded, causes subsidence that results in the structural damage to homes built above those abandoned mines.

If the town owns the mineral rights under mined areas, then as we've been told, that ownership gives the town the right to ban fracking in those or other locations.

Then I urge each member of this council to vote against any further lease or sale of the town's mineral rights.

Thank you.

Thank you.

Next, uh James Floyd.

Good evening, Mayor and Council members.

My name is James Floyd.

I'm a local resident outside of Erie proper.

I'm here tonight in support of the town of Erie moving forward and selling its unleashed mineral rights to SM energy, also known as Civitas.

Let's be clear about the situation.

The Draco L's are already approved and they're going to be drilled.

This is not a question on if development happens, it's a question of whether the city of Erie participates in the value or walks away from it.

The town, if the town chooses not to lease or sell, you are not stopping development.

You are choosing to receive nothing.

There is real substantial compensation being offered and additional safety measures in place.

And I believe the council has the obligation to disclose those terms immediately.

The people of Erie deserve full transparency on what is at stake because of because this revenue could have meaningful impact on the town.

I'm also here on behalf of Bluebird Energy Partners, a local company.

Last year, Bluebird, uh, at least 80 mineral net mineral acres from a local Erie family.

If the town's minerals are not included in the Draco wells, there's real risk that this family could be excluded, could be excluded from the pad as well.

Putting six to eight million dollars in future revenue at risk to that family.

So this this decision has real consequences, not just for the town, but for local residents.

Again, this does not stop drilling.

It only determines whether Erie reaps the benefits or not.

I urge you to act responsibly, be transparent with the public, and move forward with selling these mineral rights.

Thank you.

All right.

Thank you.

Um next is Emily Brecht.

Do we have the right person?

Oh, sorry.

Okay, I'm Emma Correct.

Oh, I guess.

Okay, just make it sure.

Happens all the time.

Try to be really fast.

Um, my name is Emily Brecht.

I live in Erie at Brendan by the Lake.

My neighbors and I live directly over the path of Draco's well boars.

And if the packets we've received by courier from Civitas or any clue, Civitus will drink our milkshake, whether we consent or not, we will likely be force-pooled.

We don't have a choice.

You do.

And I publicly ask now, don't do it.

Do not lease our town's mineral rights.

Don't give oil and gas more, even more of a foothold in Erie.

Your constituents are asking good questions about the consequences of any deal.

They're asking whether there's a conflict of interest with your hired consultant.

In response, we get hand waving.

We get just trust me.

We get shouted down in online forums that there's nothing to see here.

Well, I'm not sure if you're familiar with the Streisand effect, but the more you try to suppress information, the more it seems like you have something to hide.

On March 10th, I know this was sort of covered, but I want to say it.

When the public first questioned hiring the recent COO of Civitas to negotiate with Civitas, Councilmember Bell insisted that Matt Owens, his name came from staff.

He was a recommendation by staff.

The council had nothing to do with it.

He said nobody personally advocated for them, nobody on council.

I just want to make that perfectly clear and transparent.

Today and April 2nd, Mayor Moore clarified.

And Matt Owens reached out to him directly, and then it was passed passed on that information to staff.

If this was a QA, which I wish it was, because I have questions, um I would be asking what story is true.

That was clarified today, but I would say it's a warning to not uh clarify things that are not true, and like double check when you're being transparent.

Um other questions are there any unleashed town owned lands in the path of Draco's plan well boards?

If so, if the town I have more questions, I'll ask you later.

All right, sounds good.

Okay, thank you.

Uh next we have uh Steve.

I don't know how to say the last name.

Eight.

There you go.

That's you.

Good evening.

Thank you, town council for uh allowing me the opportunity to talk about the Draco project.

My name is Steve Hooksang, and my wife and I are new residents of Erie.

My background is in the sale of water and wastewater treatment chemicals to industrial mining and oil drilling applications.

I believe we should all continue to be completely against the Draco project for the following reasons.

Well blowout risk can never be completely mitigated.

For example, the Cheron Well blowout in Well County.

A blowout would spew significant amounts of oil chemicals contaminated water and gas into the air and onto the ground, 2,000 feet from homes.

I have seen this.

The Draco project will use an average of six million gallons of fresh water per day, which is the same as Erie.

None of Draco's wastewater will be reused or recycled.

If there is leakage from wastewater piping, it will be an EPA reportable spill.

As drilling wastewater is very highly aquatic toxic toxic.

Total VLCs estimated to be emitted from the site will be 88,000 pounds, 44 tons.

This is high for a neighborhood 2,000 feet away.

Will continuous air monitoring and reporting back to Erie be in place.

The project will drill 7,000 feet down through aquifers.

Will water in these aquifers be monitored and tested to show Erie that contamination is not occurring?

The project will laterally drill for five miles under Erie neighborhoods with the number of existing wells in and between those neighborhoods.

20 seconds.

Odor is also an issue.

How will that be regulated?

Lastly, if the sale of minerals Erie's mineral rights give up one iota of Erie's oversight and control over Erie's ability to improve the safety of the Draco project, we should be completely against the sale.

Also, no testing, monitoring, and reporting requirements of Civitas to Erie should ever be relinquished.

Thank you.

All right, thank you.

Next speaker is Laurie McAllister.

No.

She's my name is Laurie McAllister.

I am a resident of Erie.

And I believe that it's incumbent upon the town council and the mayor to ensure that our residents understand the answers to the questions we are asking and what the costs and consequences are for moving forward.

I would like to see the results of monitoring and oversight being required to be reported to the CECMC and Boulder County and Erie in a timely fashion.

And I want residents to understand what happens if there's a problem.

What are the consequences?

Not just informing Erie, but what are the penalties for a problem with our air or our water or our uh odors?

And uh who pays for monitoring and oversight, and who is currently required to be notified of monitoring results.

And second, this project has inherent conflicts of interest.

Town council and the mayor, Alameda Mineral Advisors, former Civitas Resources COO Matthew Owens, and any other future advisors and consultants should be required to reveal and divest themselves of any financial interest in Civitas, Draco, and any other gas and oil entities operating in Colorado.

Those with conflicts of interest should be required to recuse themselves or not participate in negotiations or decision makings.

I would like to see Erie make public every expenditure made 20 seconds.

Any advisors.

And lastly, I want to tell you that we were very keen on moving to Colliers Hill until I looked at the maps of oil and gas.

And so I believe that understanding the effect on housing values is more complex than council on the mayor have represented.

Thank you.

All right, thank you.

Our next speaker is Ben Hempel.

Good evening, town council.

My name is Ben Hempel, and I live in District 2 of Erie.

I want to speak tonight on my history of communication between me and the company now known as SM Energy, formerly Civitas.

In October 2024, I submitted a question through Civitas's web form asking about their experience drilling five-mile-long laterals under highly populated areas.

I received no response.

I raised this publicly in October 29th at the ECMC hearing at the Erie Middle School.

Still nothing.

After the November 13th, 2024 hearing, I sent a direct email and discovered that the email address on their own community website was never properly set up.

It bounced with the delivery error.

I tested it again today, and it still bounces.

It took me escalating directly to all of the ECMC commissioners before SM Energy finally responded to my relatively simple question.

That's a communication track record of the company you are now negotiating with on our behalf.

Based on the March 26th, 2025 ECMC hearing, SM Energy has until May 13th, 2028 to complete these wells.

At that hearing, SM Energy stated that three years was already aggressive and there's only two years left.

We all know what happens when projects get rushed.

By leasing or I guess selling the town's mineral rights, you would be incentivizing that rush.

From my understanding, the town has no obligation to sell our mineral rights.

And then on local oversight, the Draco pad was deliberately cited just outside of Erie's boundaries.

Which means a town can place its own monitoring equipment without any input from SM Energy.

If that if you continue down the path of selling our mineral rights, I urge you to have a provision that the town of Erie has authority to stop work for any reason for any length of time.

Monitoring without a stopwork authority is just watching.

It's not protection.

When you go to vote on this, please remember you represent the town and the residents of Erie, not the shareholders of SM Energy.

Thank you.

All right.

Thank you.

Our next speaker is Mike Foote.

Okay.

Um, he's not.

Let me double check it.

He doesn't list himself online, but let me double check here.

Nope.

Uh next speaker is Chevon Blades.

May I ask a quote uh clarifying question before I begin my time?

Um I just want to clarify before I start my time that you know Erie would get 25 million if we sold our milling rights.

Is that about an accurate estimate?

We we have not announced any numbers of the city.

The lawyer just said that.

Okay.

So I guess I can start my time now.

Um I have some questions I was told it was given to ask.

Um, but I see that the oil and gas industry has already shown up.

I don't know if they're paid, they were during 112.

But Cole has already started off by not telling me the truth.

I asked him if he had any association with oil and gas, and he said no.

Turns out he's the lawyer for mineral rights owners.

Anyways, I'm not here to debate the health and safety or stopping Draco.

We know that's not possible.

I'm also not here to have straw man arguments accusing the council of approving Draco.

That's not what happened.

What people are concerned about is the secrecy for six months before it was brought to the council, and then another three months before the town found out about it through reporting.

So that's one of the bigger concerns.

As far as how health and safety it is, there's 400 in leaks a year, 450 leaks a year with dozens of explosions a year.

So you know, oil and gas can tell me how safe it is all day long.

The other issue is there's 2,000 orphaned wells in Colorado, of which uh what did I say?

239 in Erie.

So we're gonna cap 22 plus 16, and I believe there's like 50 or 60 in the pathway of Draco that are gonna half of them won't be dealt with.

Um there's no logic in selling mineral rights.

I had somebody very wise tell me only a fool sells their mineral or water rights.

Here we are, Erie.

Um so those are some of the bigger concerns, but the questions that I was asked, and one was already answered.

The council has not met their terms of their contract for competitive bid and solicitation process.

Wondering if I understood that correct, that's what it sounded like.

Um do you have any legal sign-up that a competitive business solicitation process was held and that it met the obligations of the council's contract?

Do you have a legal sign-up that's fully vetted for any conflicts of interest?

I don't think we have that.

Do you have any sign up from Sabitas competitors that they were fairly notified by Owens on behalf of the town of the council, town of Erie, the council for a competitive bid?

Do you have a sign-off from the Sebitas competitors that they were okay with Owens running an evaluation of their bids?

Two of these questions have already been answered.

No, we do not have those.

So I do not think it's wise to continue to move forward in selling the mineral rights just for roughly 25 million dollars.

All right, thank you.

No, please.

Just to remind everybody that there are people here speaking on all different views, and just out of respect for everybody speaking, I don't want to stop the meeting.

So thank you for understanding that.

Our next speaker is Casey Hedrick.

Good evening, town council.

My name is Casey Hedrick.

I'm an Erie resident.

I wanna echo something that somebody else said.

Um, which is just the format of this is somewhat difficult, and that we got the information.

Uh I think you all have some some information that wasn't purview tonight.

It's just difficult because we can't ask questions.

I have a lot of clarifying questions that might inform my comments, but we're not able to ask those tonight.

So just some feedback on that.

When the Draco project initially came up, the community came out and drove to oppose it.

And there were so many people that said we do not want this, and yet the decision was made uh for us by the state.

So understandingly uh how disappointed we all are in that.

Um, and it seems like this mineral rights might be our only opportunity to alter, deter, delay, blunt this project.

And so I would urge the council not to sell mineral rights.

In addition to that, I'm really uh worried, or uh there it seems as though there's some sentiment from the council that is um well, if you can't be an abjoinum, if we can't beat this project, let's make money from it.

Or if there's already drilling happening in our community, let's just keep that drilling going.

That's not the right attitude of what I think our council should take.

This is about the health and safety of our children.

This is about the health and safety of our residents.

When we have our children's hospital citing reports about how kids get sick, how vulnerable health populations get sick the closer that they live to drilling sites, then it shouldn't be something up for discussion, and it shouldn't be something that we should monetary benefit from.

Because I think then the question is how much money is worth a sick kid?

And I don't think that that's something that this council uh should have to answer.

So please don't sell our mineral rights.

Thank you.

All right, thank you.

Our next speaker is Emily Ralph.

Um, my name's Emily.

I live in Erie in Boulder County.

Um I just like would like to kind of add my voice to what Casey just said, Carol Campbell and also Steve Hossein.

I've heard a narrative as I'm sitting in this room tonight from the council that kind of says, well, the Draco pads are already done.

Um we're mitigating as best we can.

We're trying to create this um I don't know, lemonade out of lemon situation.

We're not using any of Erie's water.

We're monitoring air quality, all of these things.

It's a really beautiful example of the lost cause fallacy, actually.

But that's a different problem.

I would like to just state that the risks associated with this project are utterly unacceptable.

We just experienced pretty much the worst winter on record for Colorado.

We canceled uh irrigation or watering bans for our yards like two days ago, and yet you're proposing a project that's gonna take six million gallons of water a day.

And then you're saying, oh, but we're gonna get wells plugged and abandoned.

Except I learned with a quick Google search that there's a well in my neighborhood that's plugged in abandoned where the soil has recently within the last couple of years had to be removed.

My main question is where did that soil go?

But also we're acting like that's fine.

I mean any addition of greenhouse gases to our environment is detrimental, and yet here we are trying to say that we can make this better.

Alameda Minerals is supposedly incentivized to work with us because uh they'll financially benefit.

But they're not necessarily going to be sitting here, they're not gonna be standing next to their sick child's bedside.

I mean, is there a plan?

Is the state of Colorado gonna cover Medicaid for every child that gets leukemia in association with this project?

Is the town of Erie?

Is Civitas?

Who's gonna help us?

We already have an issue, which is why this contract exists where we want to control tracts of land in and near the town of Erie.

We're negotiating with the same company that's trying to buy these mineral rights, and yet we are looking into selling them, albeit they're underground rights, but we're just putting ourselves in the same position over again.

You're not going to be the counsel for the town of Erie forever.

Don't sell these mineral rights, don't make a decision that affects future generations.

Thank you.

Thank you.

I understand that Mike Foote has returned to the meeting.

Is Mike here?

Mike Foote?

No.

Thank you.

Good evening.

Um, members of council, thank you very much for calling me up.

My name is Mike Foote.

I'm um, I guess maybe three or four generations ago was your state senator here.

And um I just mentioned that because I have a bit of a history with oil and gas mineral leasing policy and forced pooling.

Um, probably 10 to 12 years ago, I first came across this uh issue of forced pooling and leasing.

And frankly, I couldn't believe it.

Um you could have 100 mineral rights owners, 99 say yeah, yeah uh say no, one says yes, the other 99 have to lease.

That's how the policy was.

We ran several bills to try to change it.

Ultimately, that did get changed in 2019 to where there's a 45% threshold.

But still there was this issue out there about towns being required to lease their minerals against their wishes under the forced pooling statute.

A number of bills and efforts uh came and went.

And finally, I think as you know, in 2024, there was a successful bill, not mine, I was out by then, but a successful bill that was passed that gives towns a say.

And that's where you are right now.

Um the philosophy is that as town council members, you all um understand what's best for the community.

You hear from the community, it's like any other kind of kind of development, right?

It's basically like uh as a shopping center, residential development, anything that goes on the surface, it's the same kind of situation below surface where you all can listen to the residents and and make a determination about whether or not you want to do it.

Um hard fought, I would say, um, provision in the law over the last eight to ten years.

So I just would urge you to take advantage of it.

And if you determine after hearing from all the folks in Erie that are commenting before you that this is a bad idea, that's not what they want, then I would urge you to follow that and use the authority that you have and the local control that you have to say no.

There's nothing in the law anymore that says that you have to say yes.

The industry doesn't like that, but that's the way that it goes.

Um I would urge you, in my opinion, to say no, because this is something that um puts Erie in business with the oil and gas industry for a long, long time if you say yes.

Um, I don't think it matches the tenor of this community.

I think personally, from what I've heard, there's a lot of people that are opposed to it.

And I just hope that you'll use your authority.

That as I said, a lot of people had to work hard for to be able to say no to something like this.

So I'd ask you to say no.

So thank you very much for hearing from me and also other members of the community.

I appreciate it.

All right, thanks.

Our next speaker is Amy Becker.

Good evening.

Uh, my name is Amy, and I have lived in Erie for 11 years.

I am also an oncology PA, and so for 25 years, I have taken care of cancer patients.

In my opinion, both as a citizen as and as a medical professional, we should not expand the reach of oil and gas in our town.

For our safety, our health and wellness, we should reject this offer.

For as long as I have lived in Erie, there has been a pushback against oil and gas.

And now, why would we say that there is a price that could be paid for our health, safety, and wellness?

That's hypocritical hypocritical and it is negligent.

I was actually surprised last week or in a couple weeks ago to learn at the mayor's address that Erie was initially successful at pushing back against Draco.

Uh initially, uh we at our resistant efforts were successful and it wasn't going to happen.

But the greedy and self-serving oil and gas industry forced our hand.

Knowing how the town felt, they still pushed forward and forced our hand.

And to me, that initiative and alone should have been a non-starter for the council.

I urge you to say no and reject this deal.

I do not think that by leasing our or lease or selling our mineral rights, that this will give you additional leverage to hold them accountable.

I think you need to use everything that you have to hold them accountable anyway.

And as the speaker before me just said, I think that this will extend our relationship with oil and gas when we have been trying to get them out of Erie as quickly as possible.

And so I again would urge you to say no to this deal.

All right, thank you.

Our next speaker is uh James Salvaggio.

Okay.

Is James online possibly?

No, I don't think he is.

Okay.

Uh next speaker is Stephen Gaines.

Good evening.

Thank you for hearing some of us this evening.

My name is Steve Gaines, and I do live in Erie.

And I just wanted to mention this repeat some of the things that have been said, but perhaps say it a little differently.

A municipality is a family.

It's a collection, a group of homes, businesses, but most importantly, people.

And the current board should not sell assets owned collectively by the community.

Leasing them in a short term might allow us to still regain some benefits and have some control now and in the future.

My preference would be no sale or no leasing at all.

But if we do have to go forward, let's make sure we're gonna have control over our destiny in the future, not just today.

Selling a community asset, I think also should require a community vote, uh, not just a decision uh of our elected officials.

Uh so that's my my 30 years experience in municipal management and government.

Uh all the municipalities I worked with, we had a set policy that anything regarding dissolution of assets required a community vote.

I apologize for my ignorance.

I don't know what the policy is here.

And then I just had a question I wanted to pose.

I was unclear what the gentleman spoke to when he said three and a half percent unleashed in the target area versus 96% leased.

If that's something that's addressed during other comments later, that would be helpful.

All right, thank you.

Our next speaker is Elliot Russell, and he is online.

So hang on just a second.

Hello, can you hear me?

Yes.

Yes.

Perfect.

Uh, this is Elliot Russell.

I am a concerned resident of Erie in Boulder County.

Uh I feel like residents should be provided a map which delineates these 103 acres of unleashed town minerals.

That is the topic for tonight.

Um, it's kind of hard to understand how tonight's informational meeting didn't include um like this presented map.

Um but it might have sounded like there was some legal issues or some research still occurring.

So uh kind of concerning that it might be premature to present that information.

Uh a quick boulder county assessor search shows the town has quite a bit of surface property within the spacing unit.

Um I'm not exactly sure how that relates to mineral rights because most times surface properties have severed mineral estates, but still I'm curious to understand where these minerals are at.

If the town hears what it's what seems like the majority of residents' concerns are and does not lease or sell the minerals, then Draco must avoid the town's minerals, which could substantially change or reduce the size of this project um to ensure that they do not have a mineral trespass through either boring through the town's minerals or even draining the town's minerals from nearby uh hydraulic fracturing.

This is critical information that residents, the town council, and the mayor should all be presented with in a public setting with this information.

The town will be uh will better understand its leverage in these negotiations.

I thank the council for the opportunity to speak and again request additional information on all sessions be held once better spatial uh presentation materials are provided to the public.

Thank you.

Thank you.

Next speaker is Tanya Sharp.

I'm Tanya Sharp.

I live in District 2, Colliers Hill.

Um came over to speak in person today because I think this is important.

Um I wrote down five speaking points.

I won't be long.

But um sorry to say I was aghast when our expert who presented was not aware of any other company that did this other than Alameda Minerals.

When I tried to find Matt Owens online, I could not.

I found four or five other consulting companies that did this work.

The only thing I found on Matt Owens was his LinkedIn profile.

I'm a little embarrassed about the processes going through for Erie right now and worried that we're not doing it with due diligence and with what we could be receiving.

So that's point one.

Um Erie has doubled in population since the last time we sold any of our mineral rights in 2012, and the demographics have changed.

What we're hearing now are people that are opposed.

We went from a ton of 18,000 to almost 40.

And I would uh want those voices to be heard.

Um conflicting information on property values.

We had one person say that property values go up when wells are abandoned and capped.

She did not say property w property values go up when drilling occurs.

We are all see already seeing an adverse effect on sales and the westerly development.

They've had to put those on hold and move to other areas.

Who knows if they'll come back or or if the developments in that area will ever, you know, come back or sell at what they should be selling for.

Um 20 seconds.

The last point I have is this is an unprecedented project, and uh we have an opportunity to control it by not selling our mineral rights.

Um drilling five miles under in the project.

The the the scope of this has not been done before.

This law that was just put in place has not been pushed before.

So please take that into account.

Thank you.

All right, thank you.

Our next speaker is Janet Miller.

Hi.

Please excuse me if I'm being simplistic here.

Um I have lately come on this wonderful creation of Draco and uh am trying to play catch up.

Um have we done our own mineral testing and valuation on the open market?

Or are we just letting them decide what its value is?

Um number two.

The used water that they use in drilling, is it potable, recoverable, and reusable.

Has anyone evaluated the effect of the overall water table long term?

I know most of you folks who who live in uh HOA communities all have community water.

But and I understand that community water doesn't use our local water table, but that's not true of 100% very and we have a lot of wells in Erie, and if our wells go dry, it's very, very expensive.

So I'd like to you know just evaluate it and to keep it in mind.

Thank you.

Thank you.

Our next speaker is Charles Dusha.

Good evening.

I'm an Erie resident.

And my history is in risk management and health care.

We just state your name.

Oh, sorry.

If you're in or out of Erie.

I'm Charles Duche, I'm an Erie resident.

My history is uh in risk management and health care.

And I feel that we are not using good common sense to protect a precious asset for this community.

This is a quality of life issue, as you've heard from so many other people.

What I heard from this council is I was unaware of this.

I was unaware of that.

It's sort of smacks of hey, we've got this sale going on, and it's for the next 15 minutes.

We'll worry about the details later.

That causes me to become very concerned.

This is a quality of life issue for all of us.

We need to protect it, preserve it, and take care of our community.

This is a wonderful community to live in.

And as the mayor pointed out, reiterated his question.

Why do we need Draco?

The answer is not here, not now, not now, not ever.

Thank you.

All right, thank you.

And our last speaker is uh Jana Jacobs, and she is online.

Janna, you should be able to unmute and speak.

Hi, um, good evening.

I I my name is Jana Jacobs.

I live in Erie, and I wanted to make a couple points.

One is it seems that the council is being pushed to make a quick decision.

I think that's because the city's mineral rights are very important to the Draco project, and it is on a timeline.

The city enjoys a very special privilege as a local government that owns mineral interests, and it is a priceless privilege under Colorado law that you cannot be forced pooled.

The community of Erie came out in force against Draco, and so the idea that the council would turn around and say that it's inevitable, we'll just lease our interests and give up, is truly appalling, and um I think I hope that you will give it a serious second thought.

It's difficult to put a price on what you would be selling because no other mineral interests in Colorado enjoy the privilege that the city does in regard to its mineral interests.

It's far more than 3% when it comes down to it.

It is it is worth much more than that to this project overall.

Thank you.

All right, thank you.

And no one else online.

I have no one else.

All right, is there anybody else in the audience tonight that would like to address us?

All right.

Okay, come on up.

My name is Josephine Stair.

I'm an Erie resident.

The one thing that I have not heard is concrete doesn't last forever.

So a capped well has a lifespan of 30 to 50 years.

So for the wells that we are capping, we're gonna have to do it again.

Um, not to mention the wells that aren't capped.

And furthermore, with the bore that goes straight down through the water table that they're putting in concrete, that doesn't last forever.

Um, so I I wonder what the actual long-term consequences are, um, because that has not been addressed by anyone at this point that I've heard of.

All right, thank you.

Anyone else like to address this tonight?

All right, then I'll bring it back to council.

Um, sir, would you like to come up with that?

No rush.

Hi, I'm Bill Hughes.

I live at 1159 Acorn Drive.

Okay.

But um I have worked on for the last 20 years and I don't know, half of those properties doing architecture and planning work.

And I was tied into Draco.

It wasn't Draco or some other company.

And we had uh 360 acres listed there to develop that whole area was gonna cost millions of dollars.

We worked with the city for years, we worked with the engineering department trying to get some stuff done.

We couldn't do it at the time.

The market wasn't there.

Draco came along, wasn't Draco, some other company.

Basically, they said we can do it.

We could, if we could buy a little 20-acre piece, we don't have to put all those improvements in.

So now we've got a little piece sitting there like that.

We don't have finished streets any place around there.

We don't have sour, we don't have water.

We don't have anything up in there.

If if the energy companies could somehow be part of paying for those improvements, do you know what it costs to put in sewer and water?

Probably half of what houses cost today is sewer and water and septic, you know, you name it.

But the the energy companies don't have to do that.

And that little piece is right there because it didn't, it didn't require head, it didn't have to require any improvement.

And this the public works department said, well, heck, you can do that because that's just a you know, it's a little industrial piece.

No, we don't need sewer, you don't need water.

Well, here it is 10, 15 years later, you're stuck with that little piece there, and it's setting a bad example for what else is happening.

And then to build anything decent around here costs you a fortune.

How can we get back those dollars that that those people would be part of it?

I'm not too sure what it would be.

It would take a lot, but it's a huge cost anymore.

And the problem with that one is in order to get the sewer line, you gotta run the sewer line to the east, down along the interstate and back up the interstate and the cost and back over.

These are huge costs.

Somehow, and that company is sitting there using it.

They're not they're not paying for any of that.

But it did comply with the zoning at the time.

And it's sitting there now with with it doesn't quite touch the road, so it's they didn't improve the road.

You can see it was a little idlet in the middle of that.

So 20 seconds.

It's gotta be fairer somehow, a fairer way to get the city.

These metal companies should know in no way what they've they're really mooching off of the cities.

It's terrible.

So thank you.

All right.

Would anyone else like to address this?

Yes.

My name is Laura Brecht and I live in Erie by Brennan by the lake.

And I didn't prepare anything, but I want to say that I agree with so many of the opinions that have been expressed this evening very well.

And by sitting there and not saying anything, I didn't want to give the impression that I thought this was great.

And I was in favor of it.

I am absolutely not, for many more reasons than had been said.

So I just want to say that.

Thank you.

All right, thank you.

All right, we're gonna bring it back to the council.

Uh this will just be our closing remarks, but what I will say is that if, and that's still a big if, if it gets to the point where there is uh an agreement in principle, then there will be another date that is set where we'll actually have a hearing and be able to share much more information than what we were able to share at this uh point in time.

Um, I'll see if anybody would like to start Councilmember Hoback.

Thank you.

Um tonight was partly frustrating because as much as you I I hate the dark veil of executive session that we have to hide behind.

I understand the need for it and appreciate it, but it is frustrating.

Um but this has been a very informative and eye-opening four months for me, above all.

I think it has highlighted the deep-rooted concerns of town residents towards oil and gas mineral rights.

And not once have I heard anyone indicate there's a price at which they would be willing to compromise on those concerns.

I do have several concerns.

One is about how the relationship of all the parties involved came about.

We found out a little bit more about the initial contact and council involvement tonight.

Um, but I have concerns how the contracts got approved, or yet to be pre- present did not go through a town coordinated RFP or other competitive bidding process as called for in purchasing policies.

I'm concerned that this could open up the town to challenges from the competitors of the chosen vendors, as well as concerns from auditors.

Needless to say, there are a number of contractual dark clouds hanging over the deal, potential deal.

Like many of you have voiced, I have serious concerns about conflicts of interest when we hired a C-suite executive, the former chief operating officer of a buyer to negotiate on our behalf as the seller on the back of what is a very lucrative contract for his company.

Particularly when he introduced himself just weeks or months after his the potential buyer contacted us.

That certainly indicates to me that he was sent on their behalf.

I'm concerned that we have not investigated conflicts of interest in any stock or other financial interest he may have as a result of his former employment.

The same person who presided over the creating the Draco pad, Erie fought so hard to keep from being approved.

His former employer reaches out to Erie about its mineral rights, and sometime later he happens to reach out.

That is a heck of a coincidence.

Maps of the Draco drilling area, and therefore the drilling and spacing units, which is the basis for final drilling approval by the state, spans westward from the approved pad straight through Erie all the way to Highway 287.

And drilling bores follow straight lines.

The vast majority, if not all, would go directly under and through Erie, hence the concern of many residents.

There's not a feasible means to dodge all the properties owned by the town.

That was why I asked about subsurface trespassing.

Using the town hall as an example, the town owns not just the surface rights that we sit on, but the soil beneath it, the bedrock beneath it, all the way down.

Doesn't matter if it's a five feet or five miles.

And that includes the mineral rights, unless they are explicitly severed contractually in a sale or something like that.

We've talked about forced pooling.

Well, there are a couple of other laws that impact us.

Um, and I'm not a lawyer, but I've researched it pretty heavily.

Um we will need to discuss this with our oil and gas attorneys when the time comes in in uh executive session.

Um but as I understand it, specifically uh since 2024, there's a law in Colorado.

Other companies cannot drill through our land to reach other people's mineral rights.

Um I'll be a bit of the voice of the wilderness and and and say, yeah, we can impact Drake Draco.

Um, despite the narrative that's been making its way through social media and tonight's presentation.

Um the initial approval of the Draco pad was not a rollover and play dead moment.

In fact, we should be fighting harder than ever.

The inability to drill through Erie land without owning its mineral rights can be a major, major impediment to the ability of Draco to drill much of its planned area, currently approved or not.

In fact, in fact, without Erie rights, they are required to demonstrate to the state an alternate route of accessing hundreds of currently isolated parcels.

This renders the 2.8% or 3.5% figure as rather pointless because large percentages of non-Eerie owned acreage are taken out of the equation simply due to lack of access.

It's not enough just to tally up the town's numbers.

This is the power the town of Erie has, without question, to seriously impact the extent of the Draco pad, possibly to the make point of making it financially unviable for the operator.

We owe not only fiduciary duty to our residents, but health, safety, welfare, and direction received from them.

Finally, respect irrespective of all of this, without a comprehensive map, we don't even know if open space land is being included.

But we also have no indication that it's not being included.

This is possibly the pinnacle of importance, because it cannot be included.

Mineral rights, by definition, are real property rights.

Article 15 of our town charter charter provides for general authority for council to sell real property.

But Article 11 explicitly restricts that authority when it comes to property designated as open space.

According to the town charter, sale of real property rights must go to a vote of the residents, as this should have anyway.

Council does not have the authority to sell them.

That takes open space land and parks completely out of the deal unless we vote on it.

Thank you all for showing up.

You have heard over and over and over again that you're being listened to.

You've all shown up and let us know your opinions.

You have emailed your preferences on selling the town's mineral rights at a proc a rate of approximately three to one against the idea.

Stay tuned to find out if your make voice matters.

And we'll remain uncompromised.

Thank you.

All right.

Councilmember Pastor Melly.

Yeah.

Thank you, everyone for showing up.

And we listen, it's over and over the same thing.

And four members of the council want to look at finances money.

And I'm on the other side.

I am for the health and safety.

And I'll do an uncomfortable.

Sorry, committed to keep that going.

And I urge everyone to stop this sale.

Okay.

Councilmember O'Connor.

Thank you.

Um I am have been frustrated by this process.

But hopefully, if something does come forward, um, we will have enough, we will be able to give enough time, and we should, we need to give enough time for the community to review this information and to make um to provide more informed feedback as to what is being proposed.

So if it does move forward, I look forward to seeing those maps and all the details and and getting down to um what is gonna either make this a um a deal that should seriously be considered or a deal that should not be seriously considered.

So that's it for me.

Thanks.

All right.

Thank you.

Um thank you all for coming out tonight.

Um look, there's uh this is a few uh uh a very strong issue that that I know there's a lot of input um from the public on this.

Um my job uh is to tell you the truth and not to tell you something that you want to hear.

And what you heard about this impacting Draco is 100% false.

And I can tell you that we were told that.

So this is a difficult decision.

I agree with everything Councilor O'Connor said that we need before we do make a decision, we need to have it before the public.

And and tonight was an effort to try to show you as much as we possibly could.

Um we have we we need to protect our negotiation process.

We need to protect attorney client privilege.

So there's certain things we don't talk about because uh if something considered attorney client gets disclosed to the public, well, we have to disclose all of it, including the people we're trying to uh uh negotiate with, and and that puts us in a very weak position.

Um I will just say that I my my house is not in the Draco unit, but on the map, they're coming straight under my house.

So this affects me as much as it does um anyone else in here.

Uh so I I think we're all residents up here as well as uh decision makers, and and um that's something we we all uh keep in mind with this.

Um the the last thing that I'd I'd say is just that um uh that this is this is a uh debate on whether in my mind if if this happens um uh to give you an example, uh the city of Broomfield um spent an awful lot of time and energy going to the ECMC trying to fight coyote trails.

Coyote trails happened and they got nothing back for it.

And the oil and gas industry kept on going.

Um if you want us to be martyrs up here, we can certainly do that, and we're gonna take public interest to that.

But um, my old friend Tom Van Lone, who was formerly the mayor of this town, uh, when we annexed the landfill and um had a philosophy, and it was if you're gonna dump trash in my backyard, you're gonna pay me for it.

And um, that is the mentality that I'm going into.

It's not it is not to expand Draco, it's not to expand oil and gas industries, and it's not to, despite what any rumors have been out there, I'm getting nothing out of this.

Nobody up here is if we have a conflict of interest, we are required to disclose that before we vote on anything.

I don't own any mineral mineral rights.

Um I certainly don't own any here, and as I said, I'm not even in the Draco production area.

So um the this this is a difficult thing because uh when Draco came up and I will um laud our um environmental services director um for the work that he did going for before the ECMC because we were very realistic about what we were going to be able to do with Draco going forward, and um he went and he argued on the town's behalf to make sure that we got as much as we could to protect the public, and one of the things um it's not just money to get money here, the the the potential revenue out of this uh can be used as a stream of revenue source for our environmental services department um to help ensure that we have funding to do air quality monitoring to do those sorts of things, um and that is something that's in in the in the forefront of my mind when I'm looking at any sort of deal.

Um and the last thing I say is that it does bother me that um you know we have you know an oil and gas company owning parcels of land that are strategically important to the town's future, and um uh we want to make sure that that we are able to to do with that is is you know some of the things that we've done around here, new rec centers.

We need expansion to our laws uh uh public works facility.

We need these things to support the public, and um they're not interested in us buying property from them, and and that that that's a lot what led us down this path.

So um, you know, I hope that we can soon have a full package of what what is before us, but we don't even know if that's gonna happen, and this may fall through.

And if it does, then uh we will disclose all that information.

So all right, council member bear.

Thank you.

Um thank you all for coming out tonight.

I want to address a couple of things in public comment and then I'll read my statement.

But um we heard repeated requests for a map, and I am also very interested in a map.

Um, and I feel like we don't know really what we're talking about to Councilmember Hoback's point um about where these minerals are located, and um also letting the community know where those minerals are located, I think is really really important, and I look forward to that coming out.

Um I'm happy to hear that we're working on that, and hopefully that'll be out soon-ish at some point.

Um, and then also we heard um from our energy and environment director that the town will be deploying air quality monitoring in Westerly as part of our plan.

We also know that as a condition and approval, there's additional um air quality monitoring that's included in Draco.

Um, and those things are happening without the town considering selling our um our rights.

Um and then the additional 16 to 17 well wells that will be plugged in abandoned are not additional.

Those are wells that are slated to be plugged and abandoned, and what is on the table is expedition.

Uh so it could happen faster, it could happen all at once.

Um but I just want to be really clear about that because when we talk about health and safety measures, those are set by the state.

There are not health and safety measures that will not be enforced if Erie does not consider selling our minerals.

Um I just want to be expressly clear about that.

Um and then Coyote Trails, I'm force-pulled by Coyote Trails.

Um Civitas came to the commission, the ECMC a couple of years ago, because they wanted to expand coyote trails.

Um, I went and knocked on doors in my district and in my neighborhood to make sure that our my neighbors knew that this was going to happen.

And I was joined by council members from Broomfield.

It's not their district, they don't live here.

But they came and knocked doors with me.

And we talked to homeowners and just said we want you to know this is happening and you have rights, and you can come to the commission and speak if you would like to.

Civitas sued the state, and they lost.

So I just want to highlight that as a victory.

So yes, we have to take what we can get in the uh when we're fighting this, but um sometimes it can feel like a David and Goliath fight, but I just spoiler alert, want to tell you who won that fight.

So don't lose heart.

We're in this together, and let's let's keep going.

I want to encourage you to tuck two terms in your back pocket real quick: the dominant mineral estate doctrine and implied right.

Um I have been at regulatory tables advocating for health and safety and oil and gas development through state laws, policy, and rulemaking for the last seven years, from the legislature to legislative committees to regulatory bodies, including the Air Quality Control Commission, the Air Pollution Control Division, the Colorado Oil and Gas Conservation Commission, which is now the Energy and Carbon Management Commission, and also the Colorado Department of Public Health and Environment and the Public Utilities Commission.

To joining neighbors and community members right here in Erie when we rewrote our chapter 12 in our UDC to update oil and gas regulations for the town, applying the strict provisions that were afforded us when we passed Senate Bill 1918 that protect health safety, welfare, and the environment.

I say all this to demonstrate that I am not new to this conversation.

There's a reason Draco is just outside town limits.

Erie's regulations that prioritized public health and safety wouldn't allow it to be approved next to a water source and planned school site and neighborhood.

I joined the community and staff during the multiple hearings for Draco at the ECMC here at the Erie Middle School and also at the commission.

The sentiment from the community was clear, no further drilling under our neighborhoods.

We heard data, facts, personal stories, fear, concern, much like we've heard today.

In March of 2025, in a letter that I sent to the ECMC, I said, a site that drills beneath the entire width of our town with unproven technology as fast as possible, beneath 10,000 homes already existing within the drilling and spacing unit, with 72 more homes planned within the 2,000 foot setback near water, the FRICO ditch, and in heavily cumulatively impacted community, next to a planned elementary school, important to serve our growing community, creates enormous impacts that are impossible to justify.

As I said in the previous November, this application demonstrates that our protections for people fall short.

With the proposed five-mile laterals, the distance between sea level and the tip of Mount Everest, we cannot presume to know what all of the risks to the good people of Erie are, and therefore we have not done everything to ensure their safety.

I encourage this commission to pause this process, consider the cumulative impacts of air quality and water impacts.

With those considerations, this application should not move forward.

I humbly ask that you demonstrate your care and concern for the good people of Erie and our beloved community.

Please do not volunteer us as test subjects for this unproven drilling.

You can stand on the commission's rules to deny this application.

I'm asking you to do that.

Now we know that on March 26th of last year, the commission voted to approve Draco.

They did so with the inclusion of several conditions of approval requested by the town and the neighborhood developer for added protection at the surface level, including, and these are conditions of approval that do not that are not affected by the town of Erie's cell of mineral rights or not.

They include pre-production completion by May 13th, 2028 with every effort to be completed by October 2027, continuous air quality monitoring around the pad, and provisions to immediately address negative air impacts, plug and abandonment of 22 wells, 18 facilities, and all of the associated infrastructure in the town, and increased monitoring for a particularly problematic six concerning wells that would be included in the DSU.

I think it's important to know where in the DSU these are located and if they could be impacted by the sell or not of the town's minerals.

And importantly, paving County Road 6, which is important for keeping vehicle traffic off of County Road 5 and reducing vehicle miles traveled.

All of those things are happening.

ERI remains approximate local government, and that's a status given to us by the state.

Community, I hear your questions and your concerns, and they are valid.

One of the questions that I've heard is that can we prohibit a boar from passing through our subsurface estate?

So sorry, I have to switch pages.

So I believe the answer to that is yes.

And that would prevent them from reaching minerals in another tract.

This adjusts the dominant mineral estate doctrine in favor of residents who don't want their homes to be drilled under by preventing us in the possession of implied right.

No operator has an implied right to pass through Erie's subsurface to access minerals.

And I believe the process is that if ERI remains the property owner, we don't sell our mineral rights, then an operator would have to come to the town for a subsurface easement to drill through our mineral estate.

In its regulatory capacity, we may have the authority to regulate surface concerns and risks of a pass through board.

These are untried laws.

So sorry, back.

It prevents it.

The town has new authority to offer protections for residents further away from the well head.

The new law, among other things, states that it prohibits the commission, the ECMC, from entering a pooling order that pools the mineral interests of an unleashed owner if the unleashed owner is a local government that has rejected an offer.

The minerals subject and the minerals to subject are within the government, the local government's boundaries.

It also says if a pooling order application proposes to pool local local government unleashed interest and the local government has rejected the offer to lease, then it requires the commission to deny the application unless the applicant amends the application to no longer pool the local government unleashed interest.

So if ERI is the owner, we have the authority to deny a pass through through our subsurface estate.

So my understanding of these two provisions, that the town has the authority to prevent an operator from drilling through our minerals, and the ECMC is prohibited by law from approving a DSU that includes local government-owned minerals when a lease officer lease offer has been rejected.

So importantly, when we talk about whether we own 2.8% or 3.5% of the minerals in Draco, that matters less than where they're located.

And let's see.

What is required is political will to use it.

As I mentioned before, I'm not new to the oil and gas conversation and how it impacts our neighborhoods, our schools, our residents, our families.

The reason my my why here, the reason that I am opposed to selling the mineral rights is because I have sat with many of you to discuss your lived experiences and mine, and I have amplified the voices of impacted people at regulatory tables for years.

When I voted no on the contract with Alameda Minerals in December, I said my principles are not up for purchase, and I mean it.

One of the important things that I have learned over the last seven years is that it is important to disentangle our budgets from volatile markets.

When portions of the town's budget rely on uncertain and diminishing revenues, it puts services and projects at risk.

Also, when oil and gas revenues are entangled in budgets, it's nearly impossible to prioritize health and safety because projects and services rely on those revenues.

The lived experience of impacted residents has virtually no chance to rise to a level of importance.

It comes down to the almighty dollar every single time.

We have worked hard to untangle our budget here in Erie.

We have heard from the community, and we should um follow the advice of our community.

We should listen and do what you are asking us to do.

This town should reflect the desire of our residents, who we have heard loud and clear from for actual years.

We should ensure sustainable revenue for our town budget that does not mortgage the health and safety of our residents.

And that reflects their priorities that we know include a commitment to sustainability, health, and environment, both from the statistically relevant survey the town has conducted for more than a decade, as well as the snapshot questionnaire survey conducted last year as an effort from some on this council to demonstrate their commitment to hearing from the community and acting on those findings.

Thank you.

All right, thank you.

Can we get a copy of the question?

Yeah.

Councilman Councilmember Mortalero.

Okay.

Thank you.

And thanks everybody for coming out and voicing your concerns.

Appreciate your concerns and your frustration.

This process has taken quite some time.

Of course, to do a proper job, negotiations typically do take time.

I attended the Erie community meeting with the ECMC in the middle school on October 29, 2024.

There was great turnout, great community input.

You know, show of solidarity there.

Uh testimony and the fact that the ECMC invited them to the hearing.

Again, the air quality, um, the six wells uh that are plugged in abandoned that uh the sampling will be done.

Uh this may have been one of the first in the industry for that to happen.

Uh something something like that to get that concession.

The thermal imaging that will be in place uh is permanent, continuous, hourly leak detection on-site automated optical gas, uh gas imaging is also required.

We talk about uh Erie having two, three, four percent of the minerals um of the Draco operations.

Um that is important.

Location is also important.

Um, but the idea that we can significantly um change the plan of the operation after the state has approved it is highly unlikely.

Um, and I've not had anybody tell me that there's a strong uh case for us to be able to do that.

But can we influence this?

Yes, maybe, probably.

Uh, we're working through those details.

Um my family and I live 500 feet from a well that's been operating uh since we moved there 25 years ago.

Long before the Erie and state regulations, the tougher Erie and state like uh regulations were established.

They've been in the process of plugging this wall for over a year due to the leaks in the soil contamination.

We live the health and safety risks.

As mentioned at a high level being negotiated is improved health and safety um improvements.

The 16 and 17 wells is a big deal because we put it on an uh expedited timeline.

Uh, there is no timeline without a deal.

There is no deal yet, but it's part, it's part and parcel of the of what's being negotiated.

On site inspection, that's also very important.

And the compensation.

Yeah, we're not putting a price on anything, but if there's uh ways of something that's gonna happen, if we can benefit from it, um we can we can fight it and get nothing, or we can uh find a path that is you know that will work for the town of Erie.

Um we we may get compensated.

Also, this is within the scope of the already approved by the state Draco operation.

There is no consideration for expanding any oil and gas operations other than what's already been approved.

We're not negotiating anything outside of that scope.

Um, if this deal is negotiated, the deals will be made available, and a vote by the town council is required, and there will be a public hearing.

Um, so I want to thank uh David, uh Brina, Meredith, and our staff for all the work that they've they've done on this um negotiations and uh what you're doing uh for the council in the town.

Thank you.

All right, thank you.

Um all right, I will wrap it up.

Um, first I just want to say thank you for everybody coming out and being engaged.

Um, this is something that is kind of unique.

You know, we're in the middle of a negotiation, but we wanted to share information as soon as we could.

And believe me, we've been talking about this internal, and yet I know that many are still frustrated because we can't share everything.

And I think because we can't share everything, it's really hard for us to share exactly the scope of what we're trying to negotiate.

We're certainly not rushing.

Um, if we were rushing, we would have had something months ago.

We're holding the line on a few things that I think are very important for the outcome here.

Um I want to address just a couple points.

Conflict of interest.

Um, I've been asked do I own oil and gas stocks?

No.

Um, I do not own, I do own three properties that are in the path of Draco.

So I have three properties that are likely to get drilled under.

I own zero mineral rights on those three properties.

I'm an Erie resident just like all of you, and as I'm looking at the information, it's not like I'm trying to do something to harm Erie.

I'm trying to understand what the trade-offs are for doing something on a project that is gonna go forward anyway, but we'd have to give up some mineral rights.

Is the outcome and what we get back?

Is it worth it?

And until we can share that and actually have a public discussion, it's really hard for all of us to really get that point across.

Um, I want to address an item uh with the landfill uh that the mayor of Pro Tem brought up because I was mayor at that point.

That issue was highly contentious as well.

The landfill that generates about two million dollars a year for Erie right now was located in Weld County.

Weld County got all the revenue off of the landfill on our border.

The debate at the time was if they would annex in if we would allow them to go higher.

So you can imagine the public feeling.

It wasn't a good feeling.

But we also knew that if we said you can't go higher, they were just gonna go to Weld County, and likely Weld County was gonna say, right on, you can go higher.

And so we went through a very similar process to this, and we were able to annex the landfill in, and we now generate quite a bit of revenue off that.

You know, this deal I can't say is the same, but there are components that would be ongoing revenue.

There are components that would be one-time revenue, and then there's the um the safety elements that others have brought up um here as well.

So um we'll get there when we um when we either get a deal, and if we don't, then the answer will just be we tried, but it's gonna go forward the way it's gonna go forward.

The last thing I want to say is that um I appreciate uh councilmember Bear fighting so hard.

She was here, I wasn't here when um Draco was going through the approval process.

And along with many others, they were five, um, Councilmember Bear and others were fighting to get it stopped.

And it didn't get stopped.

And so now we are dealing with it didn't get stopped.

So, what is that?

What can we get if it is gonna go forward regardless?

It's not easy.

And I could tell you that all of us up here take this very seriously.

All right.

The next step of all of this will be if we get to a deal, we'll set a hearing date.

On a Tuesday, here's the meeting.

We want to give enough time so people can actually see what the deal is and process that before we do meet again.

So I don't know when that will be, but as soon as we have more information, um, we'll certainly uh share it.

All right, with that, thank you again, and I'll adjourn the meeting.

Thank you.

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