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People Shortage Could Fuel Natural Gas Shortage
Calling a natural gas supply shortage in the coming year "a very real possibility," Dr. Bruce M. Bell, chairman of the Mid-Continent Oil & Gas Association of Oklahoma, said there is an "urgent need" for increased drilling activity, particularly in Oklahoma. But to increase the drilling activity you need more people, and that shortage is directly related to the natural gas shortage. Sort of like a Catch 22.
"We are seeing a large increase in drilling permits, but it is going to be hard to put rigs in the field," said Bell last week. "Most available crews are being used already, and there is a very definite shortage of workers for the gas/oil patch. This is something the industry has warned about for years, particularly during the miserably low oil prices in 1998 and part of 1999."
The Mid-Continent Oil & Gas chair acknowledged that natural gas has become increasingly important in meeting the nation's energy needs. "It has a clear environmental advantage and has been among the most dependable fuels. These factors account for its increased demand." But supplies won't increase without more manpower.
He said that "at one time, we could look to the Gulf of Mexico and Canada, but both no longer have excess capacity. The reason is the decline in first-year production from new wells in these major producing areas. It is more than 40% and going up. That means a new well producing 1 MMcf/d when first produced will only be producing 600 Mcf/d in one year. Canadian pipelines are not being kept full, so the answer is not more pipelines."
Most new wells today are development wells in existing fields, he said, and "we just keep putting more straws in the same reservoirs." He also noted that wildcat wells are hitting smaller reservoirs in the producing areas, and that the federal government is denying access to non-producing areas where there are good prospects of finding large reserves, such as the Eastern Gulf of Mexico and the Arctic National Wildlife Refuge in Alaska.
Carolyn Davis, Houston
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