Western Colorado seeing boom in drilling permits

The Associated Press

A “remarkable” number of natural gas wells are being proposed on Colorado Western Slope land, according to government officials.

Three energy companies — Williams Production, EnCana Oil and Gas and KLT — have applied for 261 drilling permits at 34 locations over the next two years on U.S. Bureau of Land Management property in Garfield County.

The companies have already asked for permission to drill 71 other wells from BLM land onto private land at Hunter Mesa and Grass Mesa, BLM associate field manager Steve Bennett said.

Bennett released the figures Oct. 9 at the Colorado Oil and Gas Conservation Commission's quarterly public forum. The BLM has already issued 384 permits this year, topping the previous record highs of 362 in 2002 and 353 in 2001.

“That's remarkable,” commission vice chairman Brian Macke said. “That's a very high number of permits.”

He chalked up the drilling activity increase to a doubling of natural gas prices since 2002. “Higher prices and strong projections are driving the activity,” he said.

The BLM numbers don't include a projected 500 drilling permits the commission expects to issue in Garfield County by the end of the year.

Garfield County oil and gas auditor Doug Dennison suggested starting an energy advisory group of community staff, industry officials, regulatory agencies and the public. He said the group could help draft industry standards for energy companies, which he thinks will work better than telling the companies how to operate.

“I think that's something we'll pursue,” Dennison said. Dennison also said energy companies paid approximately $12.75 million in Garfield County property taxes for the most recent, 12-month reporting period. The county received about $500,000 from federal severance taxes and minerals leases.