Welcome to the Star-Tribune’s Energy Journal, a play-by-play of the past week in Wyoming’s wild world of energy. I’m your energy and natural resources reporter, Camille Erickson. Sign up for the newsletter here.
Power Wyoming: 'A tool, a complete picture, our future'
If you're facing the edge of a canyon and want to cross it, you will need to assess the landscape and conditions first.
"If it’s the Snake River Canyon, you might build a bridge. But if it’s the Grand Canyon in front of you, a bridge isn’t really reasonable. You may have to take a helicopter (or consider) a very different set of solutions," said University of Wyoming economist Rob Godby.
This is an example Godby uses to describe the purpose of "Power Wyoming," a new multi-pronged initiative launched by Gov. Mark Gordon last month to investigate the future of the state’s energy-dependent economy.
It's a huge undertaking for the interdisciplinary team, which consists of experts from the University of Wyoming, state agency officials and lawmakers.
The task at hand is daunting: consider the whims of a volatile energy sector and identify the economic blows the state might withstand down the road.
"We need to have a complete picture of what the economy is going to look like," Gordon told the Star-Tribune on Tuesday.
He cited the decline in coal demand, foreboding retirements of power plants and a wave of coal company bankruptcies as events that have already disrupted Wyoming's economy.
Right now, Wyoming primarily relies on coal, oil and natural gas production for revenue streams. But the commodities no longer fetch as much as they once did for the state.
But it's not all doom and gloom. The Powder River Basin continues to export tons and tons of coal every month.
"It's not a cliff," Gordon emphasized. "And at the same time, it is important that we look aggressively at how that's going to affect our revenue streams going forward."
Solutions exist for keeping the state fiscally healthy for generations to come. But first, the state needs to understand the extent of economic and policy challenges it will likely contend with ahead, state experts involved with the project underlined.
"The first part of Power Wyoming is just to define what the problem is and what the implications might look like," Godby stated. "You really need to know the details of how this is going to play out to start thinking about good policy."
Initial forecasts don't look rosy. Wyoming will likely face a sustained slump in revenue, jobs and population. Overall mineral revenue could likely decline 10 percent as early as next year thanks to sinking demand for coal, low natural gas prices and an unstable oil market.
The project will be a long haul and involve public input along the way.
"It’s not anywhere close to over yet," Godby said. "This is a complicated problem, you can’t just define a plan in a period of a few weeks or days; this is going to take months."
- A federal judge has ordered bankrupt coal firm Blackjewel to provide additional details on $73,583 of expenses that company attorneys accumulated over three months while coal miners awaited back pay.
- Meanwhile, legal and consulting firms charged a whopping $5.29 million for fees and expenses extended to Blackjewel during the proceedings, with some firms charging over $1,000 per hour.
- The U.S. Department of Energy plans to partner with the University of Wyoming to accelerate research on carbon capture technology at two of the state’s coal-fired power plants, Gov. Mark Gordon told the Star-Tribune. "It is important I think as we go forward that we have a clear-eyed look at what the contribution of coal could be," Gordon said.
- The governor also said last week he continues to consider a possible original lawsuit against the state of Washington for its decision to block the construction of a coal export terminal.
- A Colstrip Power Plant owner has accelerated its exit plans by nearly a decade and has agreed to compensate the community.
OIL & GAS
- Bridger Pipeline, LLC has begun construction of a crude oil pipeline that will run from Guernsey, through Goshen County and run the length of Niobrara County before reaching its final destination in Hulett.
- Over two dozen dissatisfied land and mineral owners in Laramie County filed a lawsuit in the U.S. District Court for Wyoming against one of the largest oil companies operating in Wyoming, accusing the international firm of squelching competition in oil and gas plays in the county by hoarding thousands of drilling permits.
- Flaring continues to worry landowners like those in Laramie County, who say the flames obstruct the landscape, contaminate the air and burn up state revenue. But some companies have developed novel approaches to addressing flaring, including two firms who want to convert the gas into computing power for things like bitcoin mining.
WIND & SOLAR
The Industrial Siting Council approved a permit for a 277-turbine wind farm across Albany and Carbon counties.
- Yellowstone National Park will cull 600 to 900 bison, according to its finalized winter plan (via Bozeman Daily Chronicle).
- Wyoming Game and Fish Department released a draft management plan to combat chronic wasting disease. It recommends thinning mule deer buck populations in areas where the disease is highly concentrated (via WyoFile).
- Wyoming Game and Fish Department Director Brian Nesvik visited Washington to testify about the need for a consideration to form a U.S. Fish and Wildlife Service Chronic Wasting Disease Taskforce.
- New research sheds light on both the vulnerabilities and strengths of sagebrush as climate variability increases.
- A new study finds extreme precipitation and a warming climate are the primary causes of flood damages throughout the West, including in Wyoming.
Last week in numbers
Friday oil prices:
- West Texas Intermediate (WTI) $58.43, Brent (ICE) $63.39
Friday natural gas:
- Henry Hub $2.32, Wyoming Pool $2.63, Opal $2.67
Baker Hughes rig count:
- U.S 799 (-3), Wyoming 29 (0)
Quote of the week
“The Court understands that expenses naturally occur during a bankruptcy case, especially during the pendency of a case as frantic and time-consuming as the above-captioned matter. However, it is the Court’s duty to the Estate and Unsecured Creditors to question the propriety and necessity for some of these expenses.”
— U.S. District Judge Frank Volk, the judge who ordered bankrupt coal firm Blackjewel to provide additional details on attorney's expenses.
The business news you need
With a weekly newsletter looking back at local history.