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Coal Bed Methane

A coal bed methane well, right, and an oil pumpjack sit side-by-side May 5, 2014, on the Barlow Ranch west of Gillette.

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Last week in numbers

Friday oil prices: West Texas Intermediate (WTI) $64.38 Brent (ICE) $73.03

Natural gas weekly averages: Henry Hub $2.93, Wyoming Pool $2.33, Opal $2.31

Baker Hughes rig count: U.S. 1,059, Wyoming 25

Quote of the Week

“Be aware that violating a commission order just because you didn’t like the options, doesn’t sit well with me."  

-- Bridget Hill, director of the Wyoming Office of State Lands and Investments, to a coal-bed methane company owner who broke a deal with the Wyoming Oil and Gas Conservation Commission

Eyeing the horizon: federal rules, tribes and landowners

Horizontal drilling is spreading across the Powder River Basin as crude maintains its over-$60 price. But since the slow rally for oil began in Wyoming, landowners in the eastern part of the state are having to deal with the consequence of a two-mile lateral: federal minerals, federal rules.

Private surfaces come under some degree of scrutiny when a well is planned that would tap federal minerals, including the possible visual impact of having access roads, pads or wells near Native American historical sites. 

Many tribes want to visit the sites to see if they are significant before a well is approved and many ranchers don't want them on their property. Additionally, landowners don't want the federal government taking stock of anything on their land. The three-pronged issue may be addressed by the Bureau of Land Management soon, as those in Washington are investigating whether the application of federal analysis on private land should be the same for long laterals that tap a minority of federally owned minerals as it is when there is a greater federal stake in the well. 

The Energy Journal podcast is available here. It takes listeners behind the scenes with some of the interviews that made the story. 

A machine shop, but not for the oilfields

Woodward Machine Corporation looks like any shop in central Wyoming that makes the sophisticated steel and aluminum parts that are used in industry. Except that it's cleaner, has women welders and serves NASCAR. 

Losing patience

The Storm Cat wells have a new owner, but that owner is frustrating some members of the Wyoming Oil and Gas Conservation Commission. A truncated panel of commissioners agreed to another extension for Summit Gas Resources' subsidiary Powder Battalion Holdings as it tries to get surface access agreements for coal-bed methane wells.  Commissioner Bridget Hill said this is the last time she'll agree to a delay. 

In brief...

U.S. Rep. Liz Cheney wants to assess a fee for protesting oil and gas leases, right of ways and APDs. Recreation, hunting and conservation groups are not pleased by the bill introduced in Congress last week. The oil industry, familiar with the costs to themselves that come with doing business on federal land, say it's not a bad idea.

Cloud Peak Energy is closing its Gillette and Broomfield offices to save cash -- and will move those employees to mines. Antelope and Cordero Rojo are increasingly being run as one unit. 

A company that says it can dry out Wyoming's rather damp coal, increase its heat content and make it more valuable, just got its test facility permits in place. Plans are to start up by fall and they're eyeing the site just outside Gillette for a more commercial venture. 

Lastly, Sen. John Barrasso tried to get the Federal Energy Regulatory Commission to agree that coal is crucial to grid reliability, but no dice. Commissioners were pressed on the latest coal bailout idea from the Department of Energy during a hearing early last week. The majority of the commissioners are appointees of President Donald Trump, but they differ with the Trump's administration on the baseload power debate. 

In other news...

China's retaliation against U.S. tariffs expanded with tariffs of its own on, among other things, coal, the Wall Street Journal reported Friday. 

Governor hopeful Mark Gordon put out an energy platform this week, called Power Wyo Forward, that includes linking up with other states' investment funds to build export infrastructure. Other bullet points are familiar: cooperative federalism, "aligning" Wyoming's energy resources, all-of-the-above energy approach and streamlining regulations. 

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Follow energy reporter Heather Richards on Twitter @hroxaner


Energy Reporter

Heather Richards writes about energy and the environment. A native of the Blue Ridge Mountains in Virginia, she moved to Wyoming in 2015 to cover natural resources and government in Buffalo. Heather joined the Star Tribune later that year.

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