Drillers must recycle fracking water under Colorado’s first-in-the nation law starting in 2026

When a driller “fracks” a well on the Front Range up to 400,000 barrels of fresh water can be pumped down the hole under pressure to fracture rock and release oil and gas — enough water to supply 1,400 families for a year.

To reduce the need for fresh fracking water, the Colorado Energy and Carbon Management Commission, on April 8 issued first-in-the-nation regulations requiring 4% of the water from oil and gas production to be recycled starting in 2026 and rising to as much as 35% by 2038.

The amount of water used for fracking — or hydrofracturing — in Colorado is minor, averaging 1.7% of the state’s total water consumption between 2011 and 2020.

“Conservation in the oil and gas industry doesn’t have as big an impact as a similar amount of conservation from the agricultural community,” ECMC Commissioner John Messner told The Colorado Sun. “That’s your biggest water user in the state.”

“But I think each sector has to look at ways to develop conservation measures, and I think this is a good step and an achievable step for the oil and gas industry,” Messner said.

There are, however, concerns about the regulations from industry and environmental groups.

The water that comes back out of a well, known as produced water, is a mixture of the water that went down and water that was in the rock formation — often saltwater from prehistoric seas. It is also mixed with oil, mud and sand.

Industry executives say one challenge is the scale of infrastructure that will be needed to cope with recycling produced water. A second problem is the fact that on the Front Range only a fraction of the water that goes down the hole comes back up.

“This makes it difficult to source sufficient volumes of produced water to recycle for the completion of a new well,” Seth Gordon, an engineer for Chevron U.S.A. Inc., said in commission testimony.

Environmental groups who participated in the rulemaking say they are frustrated by the long lead times to raise recycling targets and because there are no set penalties for failing to meet recycling goals.

Instead, operators who fail to hit the targets will have to file reports on how they will meet them, which then would become a condition of approval for future drilling plans. “It just kicks the can down the road,” Natasha Leger, executive director of Paonia-based Citizens for a Healthy Community, said in an interview.

Another concern is a recycled water credit trading system that will allow an operator who recycles more than its required amount to sell the excess recycled water as a credit to another driller. Similar trading schemes have been used for sulfur dioxide from power plants and greenhouse gases.

“Some groups pulled support for the legislation because it would create a commodity market,” Harmony Cummings, executive director of the nonprofit Green House Connection Center, said in an interview. She also testified before the ECMC. “There is concern the system could be gamed.”

The commission was directed by the 2023 Water Conservation In Oil and Gas Operations Act to set rules to reduce the sector’s freshwater use.

The statute also created the Produced Water Consortium, a  31-member group representing government agencies, research institutions, environmental and community groups, industry, and local governments.

The consortium — as an adviser to the ECMC — developed a series of reports on topics such as produced water availability and barriers to recycling. It also served as a policy forum.

“The consortium identified a number of barriers associated with increasing the amount of reuse and recycling of produced water and decreasing the amount of fresh water in oil and gas activities,” said Messner, who is the consortium’s chairman. “We built in relatively long runways between each of the target dates and reuse and recycling targets to allow for some of these barriers to be worked through.”

That is why the regulations provide that when recycling begins in 2026, operators only have to use 2% recycled water the first year and then 4% during the next three years. In 2030, the target will be raised to 10%.

90% of water used in fracking is used by Front Range drillers

The new rules zero in on the Denver-Julesburg or DJ Basin, which consumes 90% of the freshwater used in fracking in Colorado, but recycles less than 1% of its produced water. 

In 2022, drilling in the basin consumed 5 billion gallons of fresh water, according to a consortium report. That is 50% more than the city of Boulder uses in a year.

By contrast, the Western Slope’s Piceance Basin uses less than 1% of the freshwater and recycles 92% of its produced water.

There are several reasons there has been so little recycling on the Front Range. One is geology. The amount of water in rock strata varies from basin to basin. In the DJ Basin only 30% to 40% of the fracking water sent down a well comes back up.

“We get about eight barrels of oil for every barrel of water in the DJ,” said Grant Tupper, a business development director for water recycler Select Water Solutions. In Texas’ Permian Basin, he said, there are approximately eight barrels of water for every barrel of oil.

In other basins, those large amounts of produced water are waste that must be dealt with. In the Piceance, Colorado’s largest water-producing basin, it has led to an extensive network of pipelines and recycling facilities.

“Not having to deal with that produced water certainly creates better economics for operators (in the DJ) than it does in other areas of the country,” Messner said. As a result, there is little recycling infrastructure on the Front Range.

The DJ Basin has the fewest pipelines for carrying produced water and as a result the basin is more dependent on trucks for hauling produced and recycled water, according to a consortium report. “Easy access to significant road and highway infrastructure makes trucking fluids convenient.”

Select Water’s Lonestar plant, in LaSalle, is the largest recycling facility in the DJ Basin, processing 20,000 barrels of produced water a day. 

It serves Chevron’s Mustang drilling operation in Weld County through a mile-long pipeline. It also handles other operators in the area through temporary, flexible water lines.

The plant is a welter of 38 tanks, pipes and electric pumps. The water is run through a battery of tanks. First the oil mixed with the produced water is separated and then the water goes to a set of holding tanks feeding into a facility where it is chemically treated to deal with bacteria and suspended solids.

The water tumbles over a set of clarifiers where air is injected to remove suspended solids. The treated water is pumped into settling tanks before going through another set of filters. The remaining solids are removed by filter press, which leaves behind a mud cake.

The water coming in has a  rating of approximately 150 to 600 turbidity units — a measure of how cloudy the water is. The goal, Tupper said, is for it to leave with a rating below 20. Clean water is 5 units or lower.

Another service Select Water offers is acquiring fresh water for drillers. Tupper said depending on water lease prices recycled water is two times to five times as expensive.

As demand for water grows on the Front Range, recycled water will be an alternative, Tupper said. “The biggest competition is municipalities and when they get it, they typically don’t lease it back.”

Recycling comes with environmental costs

Still, building recycling facilities adjacent to well fields will be a challenge, Nathan Bennett, director of permitting and compliance for Civitas Resources, said in commission testimony. He estimated that a single onsite facility to recycle 10% of produced water would need 42 tanks on 4.5 acres of land.

“It is complicated in the Front Range because you have homes and schools and more fragmented property ownership,” said Mike Freeman, an attorney with the nonprofit environmental law firm Earthjustice and a consortium member. Freeman was speaking for  neither group.

That intersection of  communities and drilling raises worries about increased truck traffic and air emissions as produced and recycled water is hauled around the region — a region already violating federal ozone health standards.

The statute requires an increase in recycling “without increasing emissions associated with oil and gas operations.”

But the Colorado Oil and Gas Association, a trade group, noted that recycling itself could cause emissions, even hydrocarbon fumes from produced water itself can create emissions.

“The statute does not say which of these competing goals — increasing recycling and reuse or avoiding an emissions increase — to prioritize over the other,” the association said in commission testimony.

“This is one of the big unanswered questions,” Freeman said. “The consortium members are really water experts.”

The ECMC formed a working group, including specialists from the Colorado Department of Public Health and Environment, to investigate emissions and other air quality issues and make recommendations to the commission for an air reporting rulemaking in 2026.

Air emissions is only one issue that still needs to be resolved. The consortium is doing a toxicology study of produced water and gathering data from new reporting requirements on produced water.

“We really need those numbers,” consortium director Hope Dalton said. “They will tell us if the rules are effective or if we need to update or revise.” In 2028, the commission will set goals for 2034 and 2038. The default is a 35% recycling target.

A system will also have to be set up to track and audit water credits. “Staff is still working through the details … of how to properly administer that,” Messner said.

The credit system was proposed by some of the environmental groups as a way of reducing the impacts of building new recycling facilities, especially in low-income or environmentally sensitive areas.

It is also a way to help smaller operators whose wells may not on their own generate enough produced water to meet the requirements, Select Water’s Tupper said.

Still, “the credit system raised a number of flags for some people,” said Barbara Vasquez, a director at the grassroots community group Western Colorado Alliance and a consortium member, though she did not speak on behalf of either group.

Even though the oil and gas industry consumes only a fraction of the state’s water and the recycling targets will replace a fraction of that fraction, it is an important step, Freeman said.

“Unlike agricultural water, which stays in the hydrological cycle, once freshwater is sent down a well it is gone forever,” he said.

And drillers may be looking to use even more water in the future as horizontal shale wells get longer. 

In 2010, when horizontal drilling and fracking were new to Colorado the laterals ran for a mile. A drilling plan near Erie approved by the commission in March would use laterals that are 5 miles long. The longer the lateral, the more water is needed.

“The hope here is to get ahead of this and bend the curve,” Freeman said. “This is going to move the needle if these targets are implemented and save a lot of water for future generations.”