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Utah in Midst of Energy Boom

Utah in Midst of Energy Boom



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John Hollenhorst ReportingAn Oklahoma company has announced plans to drill more than 200 oil and gas wells in Eastern Utah. It's part of an energy boom that's getting bigger and bigger, and may already be the biggest ever in Utah history.

The oil and gas industry began to perk up in Eastern Utah three or four years ago. Since then roughnecks have drilled hundreds of wells. Each successful one generates nearly 15 jobs, according to state estimates. By almost every measure, the industry is revving up. Federal leasing in Utah exploded in 2004. The backlog of drilling applications gets bigger each year. What may be Utah's biggest drilling boom ever is not over yet.

Kent Hoffman, U.S. Bureau of Land Management: “I believe we’re still on the upswing of the current boom.”

It's not oil that's booming. It's natural gas, the stuff they're burning more and more around the country in new electrical power plants like this one. In the last few years, the price at the wellhead for natural gas has tripled.

Kent Hoffman: “Technology has improved over the years. And now with the record gas prices, they’re able to explore deeper horizons and new areas.”

The heart of the action is in Eastern Utah, with two dozen companies actively involved. This year in an existing oil field called Natural Buttes, the Kerr-McGee Corporation alone plans at least 200 wells. It's already pin-cushioned with hundreds of wells so even environmentalists say it's a relatively good place to drill.

Steve Bloch, Southern Utah Wilderness Alliance: “That’s where industry should be looking first.”

Steve Bloch says environmentalists are unfairly accused of blocking all energy development. He says they only challenge environmentally destructive projects, particularly in wild areas. He says nearly four thousand drilling permits have been issued in the last four years.

Steve Bloch: “And the conservation community has challenged less than one half of one percent of those.”

The BLM says environmental challenges have slowed down projects on the edges of existing oilfields. But so far it doesn't seem to have taken the edge off the boom. In the next couple of weeks, the Bureau of Land Management expects to issue a draft of a new management plan for the Uintah Basin. It's meant to balance development against protection.

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