DJ/Niobrara News Pulse May 2021

Posted: June 15, 2021

The DJ/Niobrara Basin| May 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 May)

Active Drilling Rigs in Basin- 6
Total Rigs in Colorado- 9
Total Rigs in United States- 457
Total U.S. Rigs up 52% YTD

State Permitting Data (End of May)
Permits Approved – 67

State Top Producers

Top Producer By BOE – Extraction Oil & Gas


Basin Highlights

Weld County and State Commission Decide to Streamline Permits

After the introduction of Senate Bill 181 (which directly defied the voters’ response to proposition 112) the rules for oil and gas regulation were drastically changed. Weld county attempted to circumvent the new COGCC by establishing Weld County as an area of state interest in order to identify, designate, and regulate areas and activities of state interest through a local permitting process. The resulting department was the Oil and Gas Energy Department (OGED). Weld county was able to accomplish this using 1041 powers, a bill from 1974, combined with their strengthened authority from SB 181 which states, “each local government within its respective jurisdiction has the authority to plan for and regulate the use of land by … Regulating the surface impacts of oil and gas operations.” Surprisingly, this rebellious act established the framework to organize a memorandum of understanding (MOU) between Weld County and the COGCC. The MOU establishes concurrent processes for applications in the county and state, requires a pre-application meeting process to assure applicants everything is in place for a likely approval, and most importantly, speeds up the timeline in which applications are approved so that it is in line with Weld county’s time frame.

Article Link

Whiting to Sell Weld County Assets

After a year of entering and emerging from chapter 11 bankruptcy, it seems Whiting Petroleum is doing its best to generate some free cash. They are now selling retail upstream and midstream assets in Weld County. This includes shallow decline horizontal producing assets in the Niobrara and wholly owned midstream assets. In December, these assets generated 8,321 boe/d that was 70% liquid. The total area of assets being offered covers about 70,000 acres. Bids were due June 2, so at this point, someone has snatched up these facilities and assets.

Article Link

Whiting to Sell Weld County Assets

In 2018 a coalition of clean air advocates sued the EPA on claims that the air quality was poor in the front range thanks to the emission of volatile organic compounds (VOCs). The US court of appeals sided with the activist group last year saying that the organization failed to adequately factor in pollution from industrial industries. Since then, the EPA has been doing its best to bounce back from the decision. New regulations are stating that air across 8 counties, including Denver and Weld, needs to be improved. They are allowing 30 days for public comment, and 120 days for state governments to provide information to challenge the proposal for air quality improvement. “After state officials let the fracked gas and oil industry pollute our beautiful Colorado skies with asthma-causing smog for more than a decade, it’s refreshing to see the Biden administration EPA standing up to the them,” said Robert Ukeiley, an attorney for the Center for Biological Diversity. “This step helps get us closer to the renewable energy economy of the future that will provide clean air not only for people but also wildlife and plants.”

Article Link


Top Permitting By Operator (March)

RankCompanyPermits Approved
1GMT Exploration20
2Great Western16
3Providence Operating11

Top Producers BOE (2021 cum)

RankCompany
1Extraction Oil & Gas
2Caerus
3Crestone Peak
4Great Western
5Bonanza Creek
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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