The city of Colorado Springs, which is in a legal battle with a Houston company that wants to buy the lion’s share of the Banning Lewis Ranch and drill for oil and gas on the property, is proposing a two-pronged approach to address their differences.
The city says it’s willing to support the sale of 18,000 acres of the 21,500-acre Banning Lewis Ranch to Ultra Resources, according to a proposal Monday by the city in U.S. Bankruptcy Court in Delaware, where the ranch’s current owners filed for Chapter 11 bankruptcy protection last year.
But as part of its proposal, the city asked a Delaware bankruptcy judge to allow a Colorado bankruptcy court to settle the city’s disputes with Ultra. The city says the company should be bound by a 23-year-old annexation agreement and other land-use controls that were intended to govern how the massive ranch would be developed; Ultra says the agreements would tie its hands at it pursues energy exploration on the property.
The city’s proposal grew out of what it described as “difficult, and to some degree productive negotiations” with Ultra, according to Monday’s court filing.