The DJ/Niobrara Basin | February 2022
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
Active Drilling Rigs in Basin- 14 (+2)
Total Rigs in Colorado- 14 (+2)
Total Rigs in United States- 650 (+40)
Total U.S. Rigs 62% YTD
State Permitting Data
Permits Approved – 57
State Top Producers
Top Producer By BOE – Kerr McGee (Occidental)
Colorado has some of the strictest regulations of all the oil and gas producing states. One of the rules the Colorado Oil and Gas Conservation Commission or COGCC has put in place is that no wells may be drilled within 2,000 feet of a house, with a few exceptions. Occidental Petroleum is requesting permission to drill 33 wells at 2 sites within the limit, stipulating they will prop up 32-ft walls and take steps to neutralize odors coming from the operation. This has, of course, been met with opposition and the final decision is now in the hands of the COGCC.
The downturn of COVID and Russian imports dropping to an all time low has experts forecasting an increase in the price of gasoline, even in a state such as Colorado where oil and gas is produced. The price of gas is largely based on the price of oil, and as supply dips and demand rises, an increase in its price is inevitable. While bad for consumers it works out well for American producers who now have more opportunities to export their products to countries struggling to meet energy needs.
Colorado Joins in Effort to Develop “Hydrogen Hub” to make Clean-Burning Fuel for Vehicles more Available
There is $8 billion available in federal infrastructure funding approved for building several hydrogen hubs across Colorado, New Mexico, Utah and Wyoming. These hubs will be located in each state at key points along the highway system to provide the much needed infrastructure hydrogen fuel requires prior to becoming a reliable source of energy. Hydrogen energy has the potential to be a clean energy source, however, it is currently produced largely by fossil fuels. It has caused a chicken and egg situation between hydrogen fueled vehicles and hydrogen infrastructure. The federal funding is hoping to end the debate and start off the infrastructure.
Colorado School of Mines in collaboration with the State of Colorado Carbon Capture, Utilization and Sequestration (CCUS) Task Force released a set of recommendations on how carbon capture can be used to help meet state climate goals. Some of the key recommendations include; CCUS should be used in ways that support new economic opportunities and the COGCC should obtain the authority from EPA to regulate CO2 injection wells within the state. Using CCUS, Colorado hopes to reduce GHG emission levels 50% by 2030 and 90% by 2050 compared to 2005 levels.
Top CO Permitting By Operator
|1||Red Willow Production||15|
|2||Kerr McGee (Occidental)||12|
Top Producers by BOE
|Change||Rank||Company||BOE Production (mmBOE) (01/22)|
|–||1||Kerr McGee (Occidental)||79.8|
|+3||4||Extraction Oil & Gas (Civitas)||32.9|
|+2||5||Caerus Oil & Gas||27.5|
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