Falling natural-gas prices to reduce firm’s Western Slope investments
Delta Petroleum on Monday cited falling natural gas prices in announcing it will invest $85 million, and possibly less, in capital spending next year, down significantly from its initial plans.
About 70 percent of that money will be invested in western Colorado’s Piceance Basin, the Denver-based company said. Delta is drilling near Collbran in Mesa County.
The company previously has said it is cutting its drilling rig count from four to two in that area, where it previously had planned to expand to eight rigs.
Company-wide, Delta previously had planned $150 million to $175 million in capital spending next year.
In recent months, numerous energy companies have been announcing cutbacks in Piceance Basin drilling operations or have canceled plans to expand them.
Many have blamed falling energy prices, the crisis in the nation’s lending market and stricter oil and gas development rules in Colorado as factors in their decisions.
Delta regulatory compliance manager Brian Macke previously has said the costs of the new rules concern his company. However, Delta’s chairman and chief executive officer, Roger Parker, said in a news release Monday that the exclusive reason for the cutback in its spending plans was the “continued deterioration of commodity prices.”