As unemployment numbers in the state remain low and coal sees some stability, the state’s oil and gas industry is also experiencing a bit of a surge.

Drilling permits applications are way up, and the major players in the Powder River Basin are speaking highly of its potential.  While it’s unlikely that the PRB will ever be what the Bakken is, there’s signs Wyoming’s oil and gas industry will grow in prominence as its shale plays are developed.


Mark Watson, supervisor for the Wyoming Oil and Gas Conservation Commission, presented a state of affairs address at the 2018 Petroleum Association of Wyoming’s annual conference in September.  The presentation showed the industry rebounding from the bust of 2015, which followed a precipitous drop in oil prices that brought oil prices down from highs in the $90 per barrel range down to around $30 per barrel, at its lowest.

With West Texas Intermediate prices nearing $70 per barrel, production in Wyoming is rising.  Annual oil production last year topped out at 7.67 million barrels.  Partial figures June estimate the state’s industry produced 3.9 million barrels this year.

Production from horizontal drilling operations accounted for 3.66 million barrels in 2015 and 2.12 million barrels the first half of 2018.  This put Wyoming in eighth place among states in terms of annual oil production.  North Dakota came in second, with 35.7 million barrels for the year ending April 2017.  Texas came in first place with 129.2 million barrels of oil produced in the time period.


Watson also noted in his presentation, Wyoming has the highest production of fossil fuels on federal lands of any state in the country, producing 8,270 trillion Btu.  The next highest state is New Mexico, which produces less than one-fourth that amount.

Offshore operations in the Gulf of Mexico, which is all classified as federal land, produced 3,949 Btu.

The commission continued to receive record-high numbers of drilling permits, though they were down considerably in June from the high of more than 2,000 permits in late 2017.  In June, they were down to just over 1,000, which was still double the average of much of the last few years.

The top 10 permit applicants have 18,083 drilling permits with the commission as of August.

EOG Resources

EOG had the highest number of drilling permits, with 5,209 applications, followed closely by Anadarko.  During the second-quarter conference call in August, EOG executives spoke optimistically of the potential for Powder River Basin development.  “Our PRB resource addition this quarter demonstrate once again the value of our exploration focus,” said CEO Bill Thomas.

Thomas said the company was operating in eleven basins across the United States, with two of those located in Wyoming.  These plays are referred to as the Mowry and Niobrara, and they are both located south of Gillette.  This is part of the company’s overall strategy—to not put all their eggs in one basin.  It allows them to grow production without straining the underlying assets, Thomas explained.

David Trice, executive vice president of exploration and production, also spoke highly of their explorations in the Powder.  They have about 400,000 net acres in the play, and Trice referred to their tests as “prolific.”

“The Powder River Basin is now ready to become a meaningful contributor to EOG’s future growth,” Trice said.

Like most shale operators, the company has been trying to run leaner and meaner as the field becomes more competitive in a lower oil-price environment.  The company’s drilling days are down 70 percent since late 2014, and completion stages are up 50 percent.  Trice said they were pulling off 26-stage fracks in a 24-hour period.  The cost per rig was down to $6 million for laterals over two miles, Trice said.

The company has 875 net wells in the Mowry, and another 555 locations in the Niobrara.

Anadarko and Wold

Anadarko, which has operations all over the world, was a lot less forthcoming on its second quarter conference call, concerning its push into the PRB.

Al Walker, Anadarko president, chairman, and CEO, said in a statement on the company’s quarterly earnings that its updated guidance excludes approximately $100 million of leasehold acquisitions in the “emerging” oil play in the PRB.  Walker said Wyoming offers the company some potential, which is still being evaluated.  However, he speculated that the production in the Powder River Basin would begin competing for the company’s capital in the future.

Walker commented on the growing interest in the area.  “This part of the Powder has been receiving increased visibility,” Walker said on the conference call.

The company has 300,000 gross acres in the basin.

The next largest contender for position in the PRB, based on drilling permit applications, is Wold Oil Properties, Inc.  As a private, family-owned company, it’s a lot harder to get a feel for the company’s plans in the play, including acres held.

In 2014, right before oil prices tanked, Peter Wold, president of the company and son of its founder, told the Casper Star-Tribune he expected oil prices to stay in the 80s, with break-even prices in the mid- to high-$60s.  This was at completion prices as they were at the time.  It varies from company-to-company, but in some cases, these are half what they were at the end of 2014.

Wold said the resource in the PRB will never be what the Bakken is, but he spoke highly of the play’s potential.  Based on the number of applications the company submitted to the commission, it appears he’s still betting on Wyoming’s future in shale production.

By: Kevin D. Killough for 82717

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About The Author

Originally from New Mexico, Killough began his career writing freelance for a weekly magazine in Albuquerque while completing his undergraduate degree. In addition to reporting on uranium mining in western New Mexico, he spent three years reporting in western North Dakota during the height of the oil boom. He can be reached at or 701-641-6603.

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