Colorado's Natural Gas Has a Bigger Role to Play Beyond Our Borders

A recent article laid out the reduced drilling rig count in Colorado’s oil-producing counties, painting a grim picture it attributes to lower natural gas prices and uncertainty over the implementation of the new law governing oil and gas production here, Senate Bill 181.

Yet that snapshot is just part of a much wider landscape shot that Colorado counties and other Western states and tribal nations see: the international picture. Far too often, our local focus keeps us from identifying opportunities to take actions at home that benefit our communities while demonstrating leadership elsewhere.

If we bemoan a low rig count, then we have to ask ourselves how we can change that and specifically, what is causing our situation. For certain, a lack of ability to get our natural resources to markets is one big constraint, but that’s not the entire picture either.

Fortunately, the Western States and Tribal Nations natural gas initiative, to which Rio Blanco, Moffat, Mesa and Garfield counties belong, is asking the right questions and proposing solutions that demonstrate that our oil and gas industry can lift our communities while helping the global environment and the people of other nations who need what we produce. WSTN sees the future economic prosperity of Colorado and its other members, New Mexico, Utah, Wyoming, the Mexican state of Baja California and the Ute Tribal nation, in exporting our products to the markets that need it most — growing Asian economies that right now, depend too much on dirtier fuels to meet their energy needs.

The vision of WSTN is to create rural economic development and tribal self-determination by exporting liquefied natural gas to markets like India, China, Japan, Taiwan and South Korea. This benefits us economically at home, while demonstrating an environmental duty-of-care by providing Asian nations with a cleaner, more reliable and more affordable energy source produced under our best-in-theworld regulatory standards.

A recent report by Royal Dutch/Shell on the future of LNG shows that Asian demand for LNG grew 12.5% last year and is expected to double to 700 million tons by 2040. Colorado should and must help meet this demand, which will happen under our state’s environmental regulations, the most stringent in the country.

The benefit to the global environment will be truly stunning when you consider this finding from the Shell report: the CO2 emissions savings since 2010 caused by switching to LNG have saved the equivalent of 57% of the emissions of the continent of South America. And since Shell estimates that renewable energy sources and natural gas together will account for 80% of global energy demand growth, this is an opportunity we cannot afford to miss.

Our participation in making the world a cleaner place and helping our Asian allies grow their economies will fuel our own economies for decades to come — just think about that. Instead of struggling to find funding or creating a bigger tax burden, we can become a bigger part of the global energy and environmental picture and secure the money we need for essential services like schools and the conservation efforts that all Coloradans hold dear.

The immediate benefit to Colorado comes from the property and severance taxes the state levies on oil and gas companies. Oil and gas companies paid $442.1 million in property taxes in fiscal 2018. In the same period, oil and gas severance taxes added $126.2 million statewide to our coffers to fund water, soil and wildlife conservation programs, clean energy development and crucially, provide assistance to our fellow citizens who cannot afford growing energy costs.

Crucially, severance taxes go back into the communities where oil and gas production occurs, both as grants for public projects and direct funding for local government. From 2007-2018, the $59.8 million in severance tax distributions made to Mesa County have paid for firetrucks, sanitation and water improvement projects, roads, civic buildings and even electric and natural-gas powered vehicles.

In cash-strapped counties and areas across the West, the opportunity for environmental leadership and decades of economic abundance is literally under our feet.

All we need to do now is take the right steps onto the best path forward to help our world, at home and abroad.

Ray Scott is a senator representing Mesa County in the Colorado Legislature and a candidate for Mesa County commissioner.