One of the Four Corners Oil and Gas conference organizers says the boom has already started.
“It’s already here,” said John Roe, who is part of the executive committee that planned the 2014 conference scheduled to start in May.
Roe has been working in the oil business for more than 30 years, and judging by the recent activity of some of the larger oil drilling companies, Roe’s words might be true.
More than $600 million is expected to be spent in the San Juan Basin this year by three companies.
Earlier this year, LOGOS Resources announced plans to spend $100 million this year for oil production and WPX Energy announced plans to spend $160 million.
Meanwhile, Encana Corporation expects to invest between $300 to $350 million dollars this year, which is at three times as much as the $100 million the company invested last year, said Doug Hock, Encana spokesperson.
He added that increasing oil production in the San Juan Basin is a company priority.
“We’ve identified it as one of our key areas of focus this year,” he said.
He said about 75 percent of the company’s oil production comes from five different play areas and the San Juan Basin is one of them.
With the increased spending, the company hopes to drill between 45 to 50 net wells this year and run as many as four rigs, he noted.
Last year the company drilled 30 wells, and each well cost $4 million to $5 million to drill.
“We’re trying to create more of a balance between natural gas and oil. That’s why we focused on the San Juan to bump up oil,” he said.
Kelly Swan, WPX spokesman, said their company’s quarterly report is scheduled for a May 7 release, and the company doesn’t release current information before the quarterly report.
However, he said the company has invested more money to drill oil wells in the San Juan Basin.
“We’re planning to drill 29 new oil wells in 2014 – almost double our 2013 activity,” he stated in an email.
Hock said one of the challenges moving forward is securing well drilling permits from the Bureau of Land Management.
“That’s the big challenge, getting an inventory of permits,” he said.