For years, southeastern Wyoming has been expecting an oil boom that’s never arrived. Just across the border in Colorado, drilling has reached breakneck pace, but Wyoming has been relatively quiet -- until now. The discovery of a new, more promising oil reserve has led to a surge of interest in oil and gas development in Laramie County over the last few months.
In May of 2013, oil and gas companies applied for nine permits to drill in Laramie County. In May of 2014, companies applied for 132.
The state has started plugging some of the thousand-plus orphaned wells in the Powder River Basin. The wells are relics of the coal-bed methane bust, when many companies went bankrupt and walked away without closing their wells. The state has taken on responsibility for plugging them, using a combination of revoked bonds and funds from a production tax.
Oil and Gas Supervisor Mark Watson says they had hoped to start plugging wells a little bit sooner, but that there were scheduling conflicts to take into account.
The Wyoming Oil and Gas Commission has denied a rulemaking petition from a landowner’s group. The Powder River Basin Resource Council submitted the petition a year ago, asking the Commission to consider new rules for flaring, setbacks -- the distance rig should be from a house -- and violations such as spills. Tuesday, the Commission denied the petition, saying it wants to propose its own rules on those issues, rather than starting with the citizen’s language.
The Wyoming Oil and Gas Conservation Commission has a new permanent supervisor. Mark Watson received a unanimous vote from the commissioners.
Watson was a runner-up in the last search for a supervisor and had been serving as the Commission’s interim supervisor after Grant Black’s sudden resignation in March. He's been with the Commission for almost thirty years in various positions, most recently as the principal petroleum engineer.
The Wyoming Oil and Gas Conservation Commission is planning to review several controversial issues, including flaring, well-setbacks and bonding, starting in March.
Those topics have come up a lot in recent years, with the boom in drilling. The Powder River Basin Resource Council asked the Commission to address them last year, and so have several residents in recent opinion pieces in the Casper Star-Tribune.
Wyoming regulators recorded hundreds of spills by the oil and gas industry last year, but issued just a handful of fines. As Wyoming Public Radio’s Stephanie Joyce reports, that’s actually not unusual.
STEPHANIE JOYCE: ‘Genie McMullan knows when there’s been an oil spill from the production wells on her goat farm in the Big Horn Basin.
'GENIE McMULLAN: When there’s a spill there’s a sharp smell, it’s a burning smell to my senses, my nose, my eyes, my lungs.
The head of the Wyoming Oil and Gas Conservation Commission says his agency will consider changing setback rules. Those are the rules that govern how far away oil and gas operations, such as wells, have to be from things like houses.
Grant Black spoke at a public meeting in Douglas last night. He says currently, the setback rule is the same, regardless of whether you’re dealing with a home or something else. But he says that could change.
Despite recording more than 500 spills, the Wyoming Oil and Gas Conservation Commission levied no fines for unauthorized releases in 2013.
Natural resources program supervisor Tom Kropatsch says that figure includes all releases -- whether of oil, natural gas, produced water or drilling mud.
“In 2010 we actually reduced the volume requirements on reportable spills to us. So, we see a lot more, as far as numbers of spills now than we did several years ago, just because we changed the requirement on volume.”
The legislature’s Joint Minerals Committee is mostly onboard with a new plan to plug abandoned oil and gas wells in the state. The committee discussed the Governor’s plan at a meeting on Thursday. Senator Chris Rothfuss says while the committee had questions about some of the details, like the cost and timeline, there was a general agreement that the Oil and Gas Conservation Commission should move forward with the plugging.
According to new estimates from the Governor’s office, plugging abandoned oil and gas wells in Wyoming could cost anywhere from $8 to $32 million.
The smaller figure takes into account only wells that the state knows are abandoned. The larger one includes wells owned by bankrupt methane farming company Luca Technologies and the 2300 wells the state considers ‘at risk’ for abandonment.
That number of 'at risk' wells is twice previous estimates. The Governor's policy director, Shawn Reese, says the discrepancy can be traced back to the Oil and Gas Conservation Commission.
Opinion is sharply divided on a proposed rule that would require water testing at oil and gas wells before and after drilling.
The Wyoming Oil and Gas Conservation Commission has been taking public comment on the rule since August. Two dozen groups and individuals submitted written comments, and a handful spoke at a public hearing in Casper on Tuesday.
Bob LeResche is vice-chair of the Powder River Basin Resource Council, a group that represents landowners. He says as they stand, the rules have no teeth.
Oil and gas operators need more insurance, or bonding. That’s what the leaders of several state agencies told the legislature’s Minerals Committee at a meeting today. They said there’s a gap in how much money is available and how much is needed to deal with abandoned oil and gas wells. The question is: where will that money come from?
Oil and Gas Commission Supervisor, Grant Black, says the bonding structure can be changed to avoid similar problems in the future.
There are fewer companies flaring off natural gas today than there were six months ago. In March, the Oil and Gas Conservation Commission had 65 flaring authorizations. Members of the Legislatures Minerals Committee were told by Commission Supervisor Grant Black that now there is about half that number. He also said that companies generally request flaring permits when a compressor is down or there is no pipeline to get the gas to market and they’re seeing much less of the latter.
As the state initiates its investigation of water quality issues in Pavillion, two state agencies plan to review existing data before deciding how to proceed. The Wyoming Oil and Gas Conservation Commission and the Department of Environmental Quality will look at the well bore integrity of about 50 oil and gas wells within a quarter mile of 14 domestic water wells that had at least one pollutant at levels above drinking water standards.
Several groups submitted comments Thursday on the Wyoming Oil and Gas Conservation Commission’s draft rule for groundwater testing in the state. The rule would require that energy companies test groundwater quality before and after oil and gas drilling.
Richard Garrett is a policy analyst with the Wyoming Outdoor Council, one of the groups that submitted comments. He says his group and the Environmental Defense Fund (EDF) made recommendations that they hope will close any potential loopholes in the law.
Wyoming Public Radio’s Bob Beck spoke with the new supervisor of the Wyoming Oil and Gas Conservation Commission, Grant Black. Since he started the job a few weeks ago, Black has been dealing with issues ranging from the flaring of natural gas to water contamination. He says the flaring issue is interesting.
A coalition of Wyoming groups has filed a rulemaking petition to the Wyoming Oil and Gas Conservation Commission to address oil and gas development in the state.
The petition focuses on three main issues: increasing the setback of drilling rigs from homes, schools and businesses, adequate enforcement in the case of accidents and spills…and reducing the practice of flaring. Powder River Basin Resource Council’s Jill Morrison says flaring has been a recognized problem for some time.
The Wyoming Oil and Gas Conservation Commission recently okayed an aquifer exemption that would permit Encana Oil and Gas to pump waste water from their oil and gas projects in the Moneta Divide into the Madison Aquifer, about 60 miles outside of Casper. Wyoming Public Radio’s Irina Zhorov reports that the exemption isn’t exactly a rarity, but it does bring up some big questions.