DJ/Niobrara News Pulse June 2021

Posted: July 15, 2021

The DJ/Niobrara Basin| June 2021

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 7/9)

Active Drilling Rigs in Basin- 11
Total Rigs in Colorado- 12
Total Rigs in United States- 479
Total U.S. Rigs up 86% YTD

State Permitting Data (End of June)
Permits Approved – 66

State Top Producers

Top Producer By BOE – OXY


Basin Highlights

Boulder County Squares Up Against Crestone Peak

The Colorado Court of Appeals ruled that Crestone Peak retained mineral rights on two of its leases despite not having produced for four months. Boulder County is displeased with this decision and will be attempting to take the case to the Colorado Supreme Court in hopes of a reversal. Senior Assistant County Attorney Kate Burke said that it is a critical issue for the whole state as, “Oil and gas leases stay valid as long as production continues. But what does the word ‘production’ mean? The Court of Appeals said production includes shut-in wells that yield no oil or gas, meaning operators can hold leases open without actually producing anything.” Still the court’s decision maintained that production is defined as the capability to produce oil or gas in commercial quantities. If the higher ruling is in favor of Crestone Peak, it will establish a strong legal precedence nationally. If not, then many companies will likely lose large portions of their portfolios if challenged in the future.

Article Link

Colorado Moves Forward with GHG Proposal

In early June, Governor Polis and Democratic state lawmakers reached an agreement on efforts to track and reduce greenhouse gas emissions in the state. House Bill 1266 is a revision of Senate Bill 200. The new bill allows the Air Quality Control Commission to enforce emissions reductions in oil and gas, electric-utility, and industrial/manufacturing sectors. This means the commissions will be holding oil and gas in Colorado to the goal of 60% reduction in emissions by 2030. It would also create an environmental justice ombudsman position to field complaints related to pollution impacts on vulnerable communities. While it has passed the Senate Finance Committee 4-3, it still needs to be approved by the Senate Appropriations Committee.

Article Link

Civitas Continues Expansion

The newly formed DJ basin titan, Civitas Resources, is planning to acquire yet another company. The original merger was a result of the efforts between Bonanza Creek Energy and Extraction Oil and Gas, but a recent announcement shows that they will purchase Crestone Peak Resources. Unfortunately, the news arrived shortly after a well fire in Arapahoe county that burned several trucks and some equipment. No one was harmed in the incident. The resulting company anticipates it will be the state’s first carbon-neutral oil and gas producer (scope 1 & 2) upon closing. Because Crestone’s primary investor is the Canada Pension Plan Investment Board, Crestone will be adding one investor to Civitas’ board.

Article Link


Top Permitting By Operator (March)

RankCompanyPermits Approved
1Great Western21
2GMT Exploration20
3Providence Operating15

Top Producers BOE (2021 cum)

RankCompanyProduction by BOE (mbbls)
1OXY559,172
2Civitas483,221
3Chevron351,508
4PDC Energy337,481
5KP Kauffman79,610
Hyperlinks to available Q1 2021 Reports

Rig Count

Colorado Production


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The information contained in this newsletter is provided by RARE
PETRO Engineering, PLLC via the following sources unless otherwise
noted:

www.eia.gov
www.drillinginfo.com
www.bhge.com
RARE Petro Analytics

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