Colorado increasingly must balance competing interests as the pace of energy development (a record of nearly 4,000 wells drilled this year in our state) collides with population growth.
Against this contentious backdrop, the Colorado Oil and Gas Conservation Commission on Thursday starts public hearings on an industry plan to put more wells in the prolific Wattenberg Field, part of the larger Denver-Julesburg basin that underlies northeastern Colorado. The Wattenberg field, which extends roughly from Greeley to Brighton and Longmont to Keenesburg, has produced prodigious amounts of natural gas for about three decades – in just one minute it pumps out enough energy to heat five Colorado homes for a year. But two factors are making the field controversial.
The field is aging and new techniques are needed to get the remaining natural gas, but the new methods will mean drilling more wells. Meanwhile, land in and around the natural gas field is fast being turned into housing and commercial developments, so landowners and speculators don’t want the energy industry occupying any more land.
Unlike most clashes over energy drilling, in this particular controversy almost no one is talking about loss of wildlife habitat or open space. True, wildlife areas and vistas are vanishing, but not because of oil and gas production – it’s because of residential and commercial development. The Wattenberg dilemma is a clash of economic, not environmental, concerns.
Landowners are concerned because at any time they could see oil and gas drill rigs erected only a few hundred feet from their backdoors, and, if the well site goes into production, they lose use of that property for many years. Often, landowners don’t own the mineral rights, so don’t earn royalties off the wells outside their kitchen windows.
However, the energy industry has made a cogent case that the state needs to update its rules for the Wattenberg field. For disturbing only about 1 percent more land than allowed under existing state rules, energy companies say they can recover 60 percent more natural gas. Since the Wattenberg field already is heavily impacted, that seems like a fair trade-off.
The state commission has different technical rules for different energy production areas because of site-specific geology and other factors. In the Wattenberg field, state rule 318a permits five wells to be drilled in a 160-acre area, with four wells at the corners of the square and one in the middle. The wells can be put 150 feet apart.
Gas companies Encana, Kerr-McGee and Noble Energy want the rule changed so they can add three wells per quarter section of land, or a total of eight wells per 160 acres. The wells would be 50 feet apart. The companies would use existing well pads – that is, land where access roads and wells already are located.
However, some landowners and developers want the state commission not only to deny the industry proposal but to roll back 318a so there can be only two drill pads per 160 acres, although there could be up to 20 wells drilled from the two pads. The change would leave more surface area open for new houses, retail units, etc. It’s unclear, though, whether that alternative would work from a geologic, engineering or economic perspective.
This newspaper often criticizes the oil and gas industry in cases where companies refuse to use existing pads or do directional drilling. In the Wattenberg field, though, the companies are offering to do both. We hope the state commission can formulate a compromise that satisfies both landowners and energy production, but the energy companies’ plan looks like a good start toward resolving a difficult problem.
