Colorado sets record on drilling permits
Aspen, CO Colorado
DENVER ” The nationwide recession hasn’t caught up with Colorado’s energy development yet. The state has broken the 7,000 mark in the number of oil and gas drilling permits approved, a new record.
The Colorado Oil and Gas Conservation Commission says the state approved 7,225 permits through the end of November. Commission interim Director Dave Neslin expects the state to issue about 7,600 permits by the end of the year.
Last year’s total was 6,368 permits.
Several energy companies have announced plans to scale back drilling plans and capital spending next year because of the credit crunch and faltering economy. Neslin says the state expects more moderate activity, but not a big drop.
“I would expect activity in the oil and gas sectors, like other sectors, to moderate in 2009,” Neslin said.
Falling natural gas prices and the difficulty in getting loans are causing companies to tighten their budgets. Companies in Colorado also cite what they see as regulatory uncertainty because of the state’s overhaul of oil and gas rules.
The oil and gas commission is expected to take final votes on most of the rules next week. The overhaul was directed by the Legislature to give more weight to environmental, health and wildlife issues.
“The commission has done several things to try to smooth the transition to some of the new rules and reduce some of the concerns voiced by the industry,” Neslin said.
The oil and gas commission staff unveiled proposed changes to the rules in January during five public meetings across the state. Since then, representatives from the oil and gas industry, environmental groups, local governments and state agencies have attended dozens of work sessions and hearings on the proposals.
The commission began considering the new rules during the summer and fall.
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