Area ‘continues to be economic and profitable’
By Vince Winkel – Times-Call staff writer – December 13, 2014
Last week, the benchmark U.S. oil price tumbled below $60 a barrel for the first time in five years.
That slide, which was helped along by the OPEC decision last month to maintain its production levels and refuse production cuts, has thrilled consumers at the gas pump. The price of a gallon of unleaded gasoline in the U.S. has plunged to $2.76 from $3.27 a year ago, according to AAA. In Longmont, motorists can find unleaded as low as $2.49 a gallon. This week, it is expected to be even lower.
But on the industry side, the price slide has raised concerns. Headlines have primarily predicted doom and gloom:
•”The American oil boom won’t last long at $65 per barrel” (BusinessWeek);
•”Will falling oil prices curb America’s shale boom?” (The Economist);
•”Falling Oil Prices Make Fracking Less Lucrative” (NPR).
Those headlines don’t look good, but energy experts and oil producers in Colorado haven’t started panicking.
“Companies in this business are in it for the long term,” said Erik Milito of the American Petroleum Institute. “The technologies have advanced and become more cost-effective. We are getting more oil and gas per well, too.
“People need to understand that the industry is positioned well,” Milito continued. “We are very early on in this energy revolution.”
Oil businesses in Northern Colorado are reserved on the topic.
“The Wattenberg Field remains a significant investment area for Anadarko,” was all that Robin Olsen, Anadarko’s public affairs specialist, would say on the record this week about the company’s plans. Anadarko operates more than 5,200 wells in the large oil and gas field in Weld County.
Encana Corp., which also operates extensively in Weld County, doesn’t anticipate any layoffs or production changes.
“For us, the DJ (Denver-Julesberg) Basin in Weld County continues to be economic and profitable for us, even at current prices,” said Doug Hock, an Encana spokesman. “I don’t see a staff reduction coming.”