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Energy Journal: Oil and gas stimulus program shows promising initial results
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Energy Journal: Oil and gas stimulus program shows promising initial results

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An oil and gas stimulus program launched by the state this month may be accomplishing what it intended: helping operators here recover from the economic downturn.

Gov. Mark Gordon created Wyoming’s Energy Rebound Program to give companies the money they need to complete specific projects placed on hold due to the COVID-19 pandemic. That could include plugging and abandoning wells, finishing uncompleted wells or re-completing wells.

Earlier this month, Gordon announced he would dedicate $15 million in federal coronavirus relief money to create the economic relief program. Though applications were only open for about one week, the Wyoming Business Council received 65 eligible applications, with demand for the government relief far outstripping available funding.

“The results of this program show the willingness of the oil and gas industry to put people to work in Wyoming, once they get some capital to get them going,” Josh Dorrell, CEO of Wyoming Business Council, said in a statement.

In response to the high demand, Gordon doubled the amount of funding available. He allocated an additional $15 million to the program, bringing the total amount available to $30 million. The additional relief came from leftover federal coronavirus relief dollars that could be shifted to the program, according to the state.

The Wyoming Business Council, the lead agency administering the program, said on Wednesday the program would cover the expenses of 292 oil and gas projects here, thereby creating roughly 5,500 jobs over the next year, according to applicant estimates.

The program will help the operators complete 18 drilled but uncompleted wells and 131 re-completions. It would also fund the plugging and abandonment of 143 wells. Only projects located in Wyoming were funded.

Uncompleted wells have a well bore drilled, but oil and natural gas have yet to be extracted. To complete the well, operators engage in hydraulic fracturing, or fracking. Re-completing takes place when a well has already been drilled and completed, but some oil remains that can still be extracted using other recovery methods.

Back in March, a global oil price war between Russia and Saudi Arabia caused the price of oil to tank. Meanwhile, the pandemic brought the economy to a near standstill, chilling any demand for fuel. Oil and gas operators have struggled to get back on their feet ever since, with Wyoming’s rig count hovering at historic lows for months on end.

“This is a great and appropriate use of CARES Act money to respond to the devastating effects of the pandemic on our economy,” Randall Luthi, chief energy advisor to Gordon, said in a statement. “The oil and gas operators responded quickly and they need to act quickly in the near future.”

The funding will need to be used by the end of the year to cover the goods and services related to the projects. Approved projects can start immediately.

When applications for the program initially opened, some of Wyoming’s smallest operators said the relief was far too restrictive, according to interviews conducted by the Star-Tribune.

For one, “mom and pop” businesses may be unable to front the costs of undertaking the projects, even if the state would be reimbursing them down the road.

Operators can submit invoices for goods and services completed by the end of the year to the Wyoming Business Council as they go, according to Luthi. Though all invoices are due by Jan. 30, operators can request reimbursement as soon as the transaction has occurred.

“Companies should not be left holding the bag for a long period of time,” Luthi said.

The Petroleum Association of Wyoming considered the program an investment that would have big returns for the state.

“The overwhelming interest in the Energy Rebound Program is a testament to industry’s long-term, strategic development plan for Wyoming,” Ryan McConnaughey, communications director for the association, said in a written statement. “The state’s funding will result in millions of dollars in private investment in Wyoming, spurring new activity, generating taxes and advancing the industry’s commitment to stewardship.”

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Nonetheless, others in Wyoming were less optimistic about the program.

Bob LeResche, a landowner who serves on the board of the Powder River Basin Resource Council, was happy to hear the program would create some jobs cleaning up oil and gas wells. But he still remains skeptical.

The $30 million of funding spread evenly across 5,500 workers would mean each worker received only about $5,454, LeResche said.

The landowner also bristled at providing public dollars to fund cleanup projects that were industries’ responsibilities in the first place, he said, calling it a “bailout.”

In other news...


The leading coal company operating in Wyoming will eliminate a health care benefit program for retired miners, the Star-Tribune confirmed on Wednesday. To save on costs, Peabody Energy will no longer cover medical expenses for workers on Medicare and will stop providing life insurance to retirees.


Five conservation groups submitted a protest to the Bureau of Land Management last week, challenging the Wyoming Pipeline Corridor Initiative, a massive CO2 pipeline project proposed for the state.

Wyoming’s governor has completed his consistency review of the proposed Converse County Oil and Gas Project. He will issue a determination in December, before President-elect Joe Biden takes office, according to updates provided during a Select Federal Natural Resource Management Committee meeting held last week.


Wyoming lawmakers charged with finding new revenue sources for the state will draft a last-minute bill to increase the tax on electricity generated from wind turbines in the state. Rep. Timothy Hallinan, R-Gillette, plans to present a bill draft at an upcoming Joint Revenue Committee meeting scheduled for Dec. 17-18.

There’s a new organization in town, and it’s been making the rounds in the Wyoming Legislature’s interim committee meetings. Powering Up Wyoming describes itself as a grassroots organization promoting the use of an “all of the above energy strategy” to prepare the state for an uncertain economic future.

Despite this year’s boom in wind, few new projects are coming down the pike or set to come online next year. It’s true, some companies have announced plans to install wind turbines here in the coming decade, but none are assured. The uptick in wind development here could peter out soon, some developers predict.


Palmer “Chip” Jenkins Jr. will soon become the new superintendent of Grand Teton National Park and the John D. Rockefeller Jr. Memorial Parkway in Wyoming.

Gov. Mark Gordon has selected seven members to serve on the state’s first local migration corridor working group to offer guidance on one of the most critical big-game migratory pathways in the region, located in south central Wyoming. The first local group will consist of seven members: Diane Berger, Chris Williams, Kara Choquette, Pete Obermueller, Joe Parsons, David Willms and Ed Glode. The team represents a range of interests, including agriculture, industry, wildlife, conservation, hunting and recreation. The Platte Valley Local Area Working Group will hold its first public meeting next month.

Quote of the week

“I wonder why people here are so convinced that raising this (wind) tax by $1 will cause us to lose all these businesses to our state. I don’t think it’s very likely, and I wonder why so many of you people think that it is.” — Timothy Hallinan, a representative from Gillette, during the Revenue Committee meeting last week.

Follow the latest on Wyoming’s energy industry and the environment at @camillereports


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Energy and Natural Resources Reporter

Camille Erickson covers the state's energy industries. She received her master's degree at Northwestern University's Medill School of Journalism. Before moving to Casper in 2019, she reported on business and labor in Minneapolis, Chicago and Washington.

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