An unconventional gas bounty has pushed Wyoming to No. 3 among natural gas producers, according to the Energy Information Administration (EIA).
Ranked by marketed production, Wyoming passed New Mexico to take the No. 3 spot behind Texas and Oklahoma. The state's marketed production was 1,501,823 MMcf in 2005, just behind Oklahoma at 1,536,371 MMcf and a distant third to Texas at 4,774,340 MMcf. In 2005, federal Gulf of Mexico production was 2,945,261 MMcf, and total U.S. marketed production was 17,518,776 MMcf, down nearly 3% from 18,035,799 MMcf in 2004.
According to gross production figures, which are preliminary, Don Likwartz, supervisor of Wyoming's Oil and Gas Conservation Commission, said his state produced a little more than 2 Tcf in 2005, an increase of 3.5% over 1.93 Tcf in 2004.
And as the Equality State works through environmental restrictions that currently crimp drilling activity, Wyoming is poised to grow production on the backs of three unconventional plays: coalbed methane from the Powder River Basin (PRB) and gas from the tight sands of the Jonah Field and Pinedale Anticline.
Wyoming production has been increasing for the past nine years, Likwartz told NGI. Last year the Powder River Basin produced 336 Bcf, about 16.8% of the state's production. Producers extracted 267 Bcf from the Jonah Field, accounting for 13.3% of Wyoming production. And Pinedale gave up 240 Bcf, 12% of production, Likwartz said.
Production from Jonah has been growing at a fairly good clip, from 125 Bcf in 2000 to 267 Bcf in 2005. However, production did level off in 2003 and 2004, and Likwartz attributes this to an ongoing environmental impact statement (EIS) at the Bureau of Land Management (BLM). The EIS was completed about a month ago; however, environmental groups as well as BP recently filed protests, Likwartz said. BP, which owns interests in about 25% of Jonah, is protesting the fact that the BLM included air quality targets in its EIS. BP maintains that only the state's Department of Environmental Quality has authority to do that.
Still, down spacing at Jonah has progressed from 80 acres, to 40, then 20 and now 10 with some five-acre spacing, Likwartz said. The pay zone, known as Fort Union, is about 4,000 feet thick at a depth of 7,500 to 12,000 feet. One challenge to producers is that directional drilling hasn't worked. Pressure differences between zones prevent drillers from installing casings on directional wells. "We approved vertical wells rather than directional wells," Likwartz said. "They've tried some directional wells; that was the only way they were able to drill during the EIS period, but we've not been able to get the production casing down to a total depth on 35% of the wells."
Once the EIS is settled for Jonah, the number of rigs drilling there could double. Likwartz said that estimates claim about 8.5 Tcf can be recovered from Jonah with 10-acre spacing. "And we've produced about one and a half to date."
The up-and-coming play is the Pinedale Anticline. A supplemental EIS is under way that would allow year-round drilling. Currently, drilling is restricted to six months in some areas and three months in others because of wildlife considerations.
"The Pinedale Field has been following Jonah by about five or six years, and we've done a lot of directional drilling there because they can drill one section at a time and get all the wells down before they start producing very much," Likwartz said. About 30% of Pinedale has been downspaced to 20 acres. About 7% of the field is at 10-acre spacing. The rest is at 40 acres. "The guesstimate is it's going to be three to four times larger than Jonah Field reserves."
As for the Powder River Basin, the BLM can't issue permits fast enough from its Buffalo, WY, office. Likwartz said that despite a tripling of staff, the office only issued 2,200 permits last year, up from about 1,500 in the 1999-2000 time frame. "Last year when they did 2,200 permits my agency did 7,200," he said.
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