Oil shale drilling draws questions

Scope of activity to depend on how much oil is found
2010-09-02T00:00:00Z 2010-09-12T19:24:43Z Oil shale drilling draws questionsJOAN BARRON Casper Star-Tribune The Billings Gazette
September 02, 2010 12:00 am  • 

CHEYENNE — Hundreds of people turned out Tuesday night to learn more about what to expect from the Niobrara oil shale play in southeast Wyoming.

They heard reports from a panel of representatives of state agencies, industry and local governments during the Southeast Wyoming Oil Shale Seminar sponsored by the High Plains Economic Development District in Wheatland.

Although they were given considerable information about technology and development, assurances of a bona fide oil boom for the southeast corner of the state were not forthcoming. Industry representatives said more test wells will be needed to determine the production available.

Audience members had a variety of questions, particularly about the impact on the water supply, damage to roads and whether the state should set up an impact fund to pay for local government services.

“Water. It’s always water,” Jeff Schwartz of Noble Energy Inc. of Houston said after the meeting.

He said there are always questions about water at these meetings because of media coverage over the effects of hydraulic fracturing.

Hydraulic fracturing, or fracking, is a process used to crack open rock and shale deep underground to stimulate the flow of hydrocarbons. Fracking has come under scrutiny in the Rockies and particularly in the eastern United States, for fear the process could contaminate drinking water supplies. Many different chemicals can be used in fracking.

Schwartz said there still is no solid evidence that fracking has a deleterious effect on water supply.

Noble Energy Inc. is one of the major players in the region, having negotiated leases on 750,000 acres in Colorado and Wyoming, he said.

If the development works out, it will involve millions of acres from Colorado to Torrington.

“This is an oil play,’ Schwartz said. “Oil is what is getting companies excited and the need to diversify from natural gas.”

The reason for that need is low natural gas prices, he said.

Noble Energy’s holdings are about evenly divided between oil and gas domestically and internationally.

Because there are rigs drilling in the area, activity is going to happen, he said, but the question is the amount of oil production.

Sen. Curt Meier of La Grange said he has asked the Legislative Service Office to draft a bill that would set up a separate impact account to act as a revolving loan fund for local governments affected by the oil shale activity.

Meier noted that Mick McMurry of Casper, a developer of Jonah Field, said the Niobrara oil play appears to be 10 times as big as the Sublette County natural gas boom.

He also said some preliminary estimates say the southeast Wyoming development can bring in $6 billion to $10 billion a year in revenue to the state.

Jeff Ketcham, chairman of the Laramie County commissioners, said officials in the region are fortunate to have as a resource counterparts from Sublette County and Weld County, Colo., “so we don’t make the same mistakes others did.”

Ketcham estimated that as many as 500 people attended Tuesday’s session.

“It shows that the citizens of Laramie County care about what is going to happen economically and environmentally,” he said.

Copyright 2015 The Billings Gazette. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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