Drilling cools in Garfield, once a hotbed
Garfield County is on pace for a third-consecutive annual drop in drilling activity, which would put it at a level not seen since 2003.
The onetime state leader in oil and gas development as measured by the start of drilling on wells is now a distant second behind Weld County, with 207 well starts this year through July 12, about a third of Weld’s 607. The state total is 952, according to Colorado Oil and Gas Conservation Commission data.
With the exception of a minor increase in 2010, Garfield’s well start numbers have fallen steadily since peaking in 2008 at 1,688. It had led the state from 2005-08, before natural gas prices fell and energy companies began focusing on more oil-rich Weld County.
Garfield is now on a pace similar to 2003, when 417 well starts occurred in the county.
Drilling permits in the county also are lagging behind last year, with 469 approvals through July 12 compared to 1,046 in all of 2012.
The COGCC has approved 2,057 permits statewide so far this year. It approved 3,733 for all of 2012. In Weld County, 1,274 permits have been approved.
Seventy-one have been approved so far in Mesa County and 41 in Rio Blanco County. But just three wells have undergone drilling in Mesa County for the year. Rio Blanco County has had 20 well starts.
Encana USA and WPX Energy continue to account for most of the local drilling activity in northwest Colorado. Thirteen rigs are currently drilling in Garfield and Rio Blanco counties, according to the nonprofit group Community Counts. Those include five Encana rigs, seven WPX rigs, and one being run in the Battlement Mesa area by Ursa Operating Co. LLC, the buyer of Antero Resources’ assets in the Piceance Basin.
Fram Operating also recently began running a rig on private land east of Whitewater as it awaits Bureau of Land Management action on its proposal to drill up to 108 wells on about 26,000 public and private acres in an area stretching to south of Palisade. Fram is targeting oil rather than natural gas.
In June, WPX announced it would operate seven rigs in the area for the rest of the year, up from a planned five. The increase means $60 million in additional capital spending for the region and comes in response to recent improvement in gas prices.
The state reports that as of July 8, there were 10,337 active wells in Garfield County, out of 50,877 statewide. Weld County has 20,324 active wells. Rio Blanco comes in sixth, with 2,937, and Mesa seventh, with 1,059.