West Slope gas firms ‘not going anywhere’ | AspenTimes.com

West Slope gas firms ‘not going anywhere’

Mike McKibbin
Rifle correspondent
Aspen, CO Colorado

BATTLEMENT MESA,Colo. ” While natural gas development are not at the same break-neck pace of the past few years, the companies are in western Garfield County to stay, according to spokeswomen for two largest firms.

Donna Gray of Williams Production and Sher Long of EnCana Oil and Gas talked about the reduction in drilling activity for 2009 at an economic update forum last month in Battlement Mesa.

Williams has scaled back area operations by 60 percent this year, “but we’re still here,” Gray said.

“We cringe every time we see the word ‘bust,’ because it has such a finality to it,” she said. “We’ve invested so much here, and there’s so much more to do, we’re really not going anywhere.”

Gray called 2008 a “very, very unique” year that was “almost over the top.”

Last year, Williams had 25 drilling rigs in Garfield and Rio Blanco counties, drilled more than 600 wells and had more than $1 billion in expenditures, Gray said. Daily gas production was at 850,000 cubic feet.

“I’m not sure it will ever look like 2008 again,” she said.

This year, Williams plans to average nine or 10 rigs, drill 270 wells and have $600 million in expenditures, plus another $100 million for a gas processing plant soon to begin operation in Rio Blanco County. Gray said the company plans similar activity in 2010.

A “drastic” downturn in the price of natural gas on the New York Mercantile Exchange last summer, along with an abundance of gas already in storage, has led companies to cut back activity, Gray said.

Long said the Piceance Basin’s challenging geography makes gas more costly to produce and get to market than elsewhere in the nation. Recently adopted rules and regulations by state lawmakers gives companies another reason to take a cautious approach, she said.

She agreed with Gray that when drilling activity does increase, it will be more balanced. “Unrealistic” property appraisals was one result of the high level of activity last year, Long said.

“We have tremendous lease holdings in western Colorado, and we’re dedicated to finding economical ways to continue our drilling program,” she said.

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