Drilling off slightly in Garfield for 2011
Oil and gas drilling permits for Garfield County for 2011 came in at about two-thirds of the previous year’s number, although the decrease in actual drilling activity was much less.
Statewide, permits were down, but the number of new wells on which drilling began actually increased from the previous year, the Colorado Oil and Gas Conservation Commission reports.
The agency issued 1,323 permits in Garfield County last year, compared with 2,037 the previous year. The statewide total was 4,659, down from 5,996 in 2010.
However, number of well starts in the county, 853, was about 94 percent of the 910 starts in 2010, and was greater than the 765 starts in 2009. Statewide, well starts increased from 2,757 in 2010 to 2,992 in 2011.
That growth was driven by Weld County, which had 1,587 well starts for the year, up from 1,195 the previous year. Weld, which leads the state in drilling activity, thanks partly to new efforts to develop oil resources, experienced year-over-year growth in approved permits, going from 2,152 to 2,262.
Commission officials pointed to well-start data in contending the state’s decline in permit numbers may be misleading. A rule change a few years ago made permits good for two years instead of one, and the number of active permits that companies had on hand as of the end of last year was 5,329. That suggests the decrease in permit applications may not be that significant, said Thom Kerr, who oversees permitting for the commission.
Garfield County ranks second in the state for drilling and permitting activity. The two leading oil and gas developers in the region are WPX Energy and Encana. Neither has announced yet its drilling plans for 2012, although Encana spokesman Doug Hock has said he expects its local activity will be similar to 2011.
Another major local player, Bill Barrett Corp., recently announced it is adding a third drilling rig to the two it was operating locally. The company plans to drill about 175 wells in its operating area south of Silt in a $290 million program. Last year it drilled about 123 local wells and spent $209 million, Bill Barrett Corp. representative Doug Dennison said.
Drilling permit numbers fell from 306 to 127 in Mesa County between 2010 and last year, and from 441 to 109 in Rio Blanco County. Well starts increased to 30 from 11 in Mesa County, while falling from 107 to 68 in Rio Blanco County.