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Division Seven Water Court Decision <br />Vance vs. Simpson <br />• In November 2005, two ranchers in southwest Colorado filed a <br />declaratory relief action seeking a determination that ground water <br />diverted in the process of extracting CBM is tributary to surface <br />streams thus requiring CBM producers to comply with state water <br />laws. <br />• In its July 2007 decision, the court concluded that (1) the diversion <br />or production of water in the course of CBM development is subject <br />to the state water laws, and that the COGCC does not have the <br />exclusive authority to regulate oil and gas wells and their associated <br />exploration and production waste. (2) The Court concluded that the <br />pumping of ground water is an application of state water for <br />beneficial use within the meaning of the 1969 Water Act. <br />• The district court for the Seventh Water Division thus concluded that <br />ground water pumped during CBM extraction requires a well permit <br />and augmentation plan for out-of-priority diversions. <br />• The SEO obtained a stay of the decision and it is on appeal to the <br />Colorado Supreme Court.