Erie Town Council approves sale of Colorado mineral rights for major oil and gas development

Erie Town Council approved the sale of its mineral rights to SM Energy Company during its regular meeting late Tuesday night. This will allow SM Energy to conduct its major oil and gas project within the Draco Pad well site that will stretch from Weld County into Boulder County. 

With the plan falling into place for SM Energy, this will mark the future development of what is to become one of the largest oil and gas developments in the state.

According to the town’s press release, “The agreement provides for the plugging and abandoning of 17 wells, allows Town staff to conduct site inspections on the Draco Well Pad on a regular basis, transfers three parcels of land (for a total of 158 acres) to the Town of Erie, assigns a 3% share of revenue from the production of these minerals to the Town, and a cash payment of $4.5M will be made to the Town. SM Energy will gain ownership of mineral rights equal to roughly 182 acres, or 4.9% of the overall Draco drilling area.”

The agreement passed in a close 4-3 decision after it had recently failed in a 3-3 council vote June 16. 

The state originally approved the Draco Pad well site development in 2025.