The DJ/Niobrara Basin| September 2020
Field Overview
Located mainly in the Northeast of Colorado, the Denver-Julesburg Basin consists of five main oil-producing formations: Niobrara sections A-C, Codell, and Greenhorn. These five plays produce over 90% of Colorado’s oil/gas.
State Drilling Statistics (End of September)
Active Drilling Rigs in Basin: 4
Total Rigs in Colorado: 5
Total Rigs in United States: 261
Total U.S. Rigs down -70% YTD
State Top Producers
Top Oil Producer- Kerr McGee Oil & Gas Onshore LP
Top Gas Producer- Kinder Morgan
Financial & Economic Updates
What About 1500?
The Colorado School of Mines and CU Boulder have teamed up to determine the economic results of setbacks. At present, Colorado law requires that oil and gas setbacks are anywhere between 500 and 1,000 ft. Once that setback reaches 1500 ft. Colorado has the potential to lose $500 million in annual resource revenues, roughly 0.1% of the state’s gross domestic product. If you bump that number to the proposed 2,500 ft setback from a multitude of ballot measures and groups, that loss climbs to $4.5 billion as more and more land becomes inaccessible. The talk of a new setback has become a hot topic as the newly appointed COGCC board members are heavily considering implementing one themselves.
State Highlights
Another Proposed Setback
COGCC chairman Jeff Robbins told the Colorado Sun that there was support for extended setbacks. This shift in policy is supposed to be a strong message to operators in encouraging them to check in with the commission and local governments early on to ensure that their drilling pans are doable. Former director Dave Neslin expressed his concern at a commission hearing by saying the setback will, “exponentially increase the amount of land that is off limits to oil and gas developments.” These are the same concerns that many expressed back in 2018 when voting on proposition 112. Many people in industry share this same sentiment. Dan Haley, the president of the Colorado Oil and Gas Association, said, “The setback recommendation is completely arbitrary, not based on science, and is being made without any legitimate consideration of its impacts on working families across our state.”
Green Plan
Governor Jared Polis released a draft of his greenhouse emissions plan, and it is aggressive. He plans to cut greenhouse gas pollution by more than a quarter of 2005 levels, and at least by half in 2030. By 2050, he hopes that “close to 100%” of the vehicles on Colorado’s roads in 2050 to be fully electric. Even so, many are eager to adopt these policies as the National Weather Service recently warned that residents in the front range should avoid outdoor activities thanks to massive wildfires in the state. The ability to meet the proposed policies is entirely possible, but it will require new policies statewide. Plans include adoption of low-cost renewable energy, reducing pollution from personal vehicles, and cutting pollution from many industries.
Top Oil Producers (2020 cum)
| Rank | Company | Production (Bbl) |
| 1 | Kerr McGee | 25,454,855 |
| 2 | Noble Energy | 17,930,717 |
| 3 | PDC Energy | 15,702,575 |
| 4 | Extraction Oil and Gas | 12,278,183 |
| 5 | Great Western | 8,270,841 |
Top Gas Producers (2020 cum)
| Rank | Company | Production (Mscf ) |
| 1 | Kerr McGee | 219,482,604 |
| 2 | Kinder Morgan | 213,830,153 |
| 3 | TEP Rocky Mtn. | 153,137,088 |
| 4 | PDC Energy | 135,501,836 |
| 5 | Caerus Piceance | 100,768,770 |
Refining
Colorado Production
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www.eia.gov
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