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SALT LAKE CITY -- Rocky Mountain natural-gas production is soaring as new pipelines take away the region's bounty.
Utah, Wyoming and Colorado together are producing 8.2 billion cubic feet of gas a day -- an increase of 1 billion cubic feet from a year ago, said Porter Bennett, president and chief executive for energy analysts Bentek Energy LLC.
Bennett said Rocky Mountain producers were holding back gas last year because of constraints in pipeline systems that drove spot prices under $1 per 1,000 cubic feet. The price has recovered to $8.39, and producers are tapping wells as fast as they can.
The difference? The 1,678-mile Rockies Express, a pipeline from Meeker, Colo., to Clarington, Ohio, that is largely built and partly operational.
Nearing full capacity, the Rockies Express will move 1.6 billion cubic feet of natural gas a day -- a third more gas than the daily consumption of Denver and other cities along Colorado's Rocky Mountain Front.
Wyoming has vaulted to No. 2 among gas-producing states behind Texas. Colorado ranks sixth and Utah eighth, according to the Utah Geological Survey.
Gas drillers last year set a production record in Utah. Drillers produced more than 385 billion cubic feet of natural gas, up 12 percent over 2006.
Bennett said it isn't clear if the increased production is sustainable over the long run. It could drive market prices down, prompting producers to shut off wells and store their gas. That, however, isn't always practical because it can cost more money to restart a well.
The Utah Division of Oil, Gas and Mining attributes Utah's increase to markedly higher drilling. There were nearly 4,700 wells producing gas in 2007.
Uintah County was the state's largest producer of natural gas, followed by Emery, San Juan and Summit counties.
Oil production, once in decline, rebounded to more than 19 million barrels -- the highest since 1997 but still below the record of 41 million barrels. Duchesne County is the state's biggest oil producer.
Wolverine Gas & Oil Corp. of Grand Rapids, Mich., is producing 10 percent of Utah's crude oil after making a wildcat discovery in 2004 near Sigurd in central Utah.
The company's Covenant Field is in a slow decline, but the company made another oil discovery nearby in Salina, said Michael Vanden Berg of the Utah Geological Survey.
The Covenant field peaked at 195,000 barrels of oil in July 2006, a figure that dropped to less than 144,000 during December 2007, according to the most recent figures posted on a state Web site.
The Covenant field had produced a total of 4.9 million barrels of oil by December, Vanden Berg said. Wolverine's president and chief executive, Sidney Jansma Jr., couldn't be reached for comment Monday. |
