CHEYENNE, Wyo.—The Wyoming Lands and Investment Board is awaiting results from a special state oil and gas auction prompted by a sale in May when leases sold netted a record $45.6 million.
Almost 300 parcels across more than 100,000 acres were up for grabs Friday in eastern Wyoming, where the oil and gas industry if salivating over the deep Niobrara Shale formation. Speculation is that the formation underlying Wyoming, northeastern Colorado and western Nebraska could yield large amounts of oil using horizontal drilling and other techniques.
Oil industry officials admit they taking a gamble with parcels they’re buying because the land is still unproven.
“We oil men, we always believe, even without all the evidence. We just have to,” said Steve Gose of Retamco Operating Inc.
Industry officials say the Niobrara formation resembles the productive Bakken formation in North Dakota but that it’s too soon to know who much oil it will yield.
Sale numbers from Friday’s auction are expected to be released next week.
The fascination with the Niobrara oil sands formation began when EOG Resources drilled a gusher in Colorado’s Weld County, bordering Wyoming.
The latest auction again showed how much interest there is in the parcels in eastern Wyoming, even though the areas have not been traditionally known for energy development. Some parcels in Laramie County were selling for up to $1,200 per acre at auction and parcels in Goshen County went as high as $3,000 per acre.
That wasn’t always the case.
“This stuff doesn’t (typically) sell or it sells for $1 an acre,” said Harold Kemp from the Office of State Lands and Investments.
Most of the parcels at auction were located in Laramie, Platte and Goshen counties.
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Information from: Information from: Casper Star-Tribune – Casper,
Information from: Wyoming Tribune Eagle – Cheyenne,
