GarCo continues to see increased natural gas activity |

GarCo continues to see increased natural gas activity

RIFLE ” Garfield County continues to command center stage in the natural gas development scene playing out in Colorado. More and more interest continues to focus on northwest Colorado, especially Garfield County, which saw an astronomical increase in applications for drilling permits last year, a number which should hold steady this year, said Colorado Oil and Gas Commission director Brian Macke. Macke presented the gas update at the Northwest Oil and Gas Forum in Rifle Thursday.

“We hit an all time record high last year with 4,363 permits” statewide and 1,500 permits in Garfield County alone, he said.

However, Garfield still lags behind Weld County in the number of producing wells, 3,295, compared to Weld’s 11,599 wells, Macke said. The total number of operating wells in the state is 29,944, which should reach 30,000 this year.

All that development is putting Colorado in a position to catch up with the country’s largest gas producer, Wyoming, which produces more than 4 billion cubic feet (bcf) of gas daily. Colorado now produces about 3.3 bcf of gas daily, Macke said. It has been on a steady 5 percent annual increase for the past several years that is expected to continue.

“In the next few years Colorado could be producing as much gas as Wyoming,” Macke said.

Gas production in northwest Colorado has considerably increased, due to construction of large gas transmission lines out of the Piceance Basin within the last couple of years. The latest of these is the Rockies Express line, which will deliver about 1.8 bcf of gas to Ohio and points east when completed.

That output was worth $9.5 billion in annual production value in 2005 and should continue at about the same or slightly lower rate this year, Macke said. Garfield’s share amounts to $2.27 billion, compared to a production value of $254,000 in 2002.

“That’s a very dramatic change in just a few years,” he said.

Gas development is naturally driven by demands for energy across the country. But the sky-high prices seen over the winter will not be matched this year.

“Gas prices are on a bit softer trend,” Macke said. “They had a high spike earlier in the year because of hurricanes Katrina and Rita and the high level of demand. We expect prices to soften over the next year.”

The spot price for natural gas on the New York Mercantile Exchange Wednesday, June 14, was listed at $6.59 per million British Thermal Units. Prices shot up to a high of $11 mmbtu in January because of the loss of gas inventory in the Gulf states due to hurricane damage.

Contact Donna Gray: 945-8515, ext. 510

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