The Colorado Oil and Gas Conservation Commission has approvedBarrett Resources’ proposal to drill one well per 20 acres withinthe company’s 9,000 acre Rulison, Parachute, and Grand Valleyfields located in the Piceance Basin of western Colorado. With thisruling, Denver-based Barrett expects to add 143 Bcf of proved gasreserves from the allotted 134 well sites by the end of 2000.

The approval sets the stage to extend the Piceance drillinginventory by over five years with a continuous four-rig drillingsystem. It follows a similar ruling in 1998 that opened 4,000 acresin the Piceance to the same well spacing. Barrett’s proved gasreserves in the Piceance as of Dec. 31, 1999 were 461 Bcf.

“Barrett has achieved exceptional success in the PiceanceBasin,” said Joseph N. Jaggers, president of Barrett. “Productionlevels continue to exceed our original forecast for the year.Development on 20-acre well density will allow Barrett to improvereserve recovery and sustain low risk production growth.”

The commission’s ruling did impose certain requirements on theproducer. The company must use directional drilling from 40-acresurface locations for 33 of the 134 wells, additional sitereclamation and advance notice on drilling. Barrett expects theseconditions to add up to $140,000 (15%) to the drilling andcompletion costs on each of the 33 wells.

The company’s Piceance gas production has increased 17% sincethe beginning of 2000, setting a record level of 105 MMcf/d.Barrett attributes the rise to its continuous four rig drillingprogram, more efficient drilling techniques and increasedcompression on the gathering system. As a result, the company saidit expects to surpass its forecast for the year by 21 wells,drilling a total of 88 wells in 2000.

“Our exploration team also continues to generate qualityprospects in the Piceance Basin, such as the Grand Hogbackprospect, which will be tested in 2001. The Piceance Basin is acornerstone of the company’s natural gas growth and demonstratesthe effectiveness of the Company’s Rocky Mountain strategy,” saidJaggers.

Alex Steis

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