natural gas & oil infrastructure in the rockies an update joint minerals, business and economic...
TRANSCRIPT
![Page 1: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/1.jpg)
Natural Gas & Oil Infrastructure in the Rockies
An UpdateJOINT MINERALS, BUSINESS AND ECONOMIC
DEVELOPMENT COMMITTEE
Casper, Wyoming May 25, 2006
![Page 2: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/2.jpg)
A Lesson From Natural Gas
![Page 3: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/3.jpg)
First Year Natural Gas Production, J onah/Pinedale
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
1,800,000Dec
-00
Dec
-01
Dec
-02
Dec
-03
Dec
-04
Dec
-05
Year
Flow
(M
cfd)
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
Pre-1990 Total (Mcfd)
Updated March 6, 2006 (Data accurate through December 1, 2005)
![Page 4: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/4.jpg)
Garfield County, Colorado
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
Mcf
d
2000 2001 2002 2003 2004 2005
Colorado Oil and Gas Commission
![Page 5: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/5.jpg)
AAPG
![Page 6: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/6.jpg)
WBIGrasslands80 MMcfd
El PasoCIG
50 MMcfd
William’sNorthwest175 MMcfd
El PasoCheyenne
Plains770 MMcfd
MidAmericanKern
1,052 MMcfd
GasInfrastructure Added in Last
5 years
Total of 2,127 Mcfd added in the past 5 yrs
![Page 7: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/7.jpg)
THE FUTURE!
1.8 Bcfd
42 –inch diameter
1,323 Miles
![Page 8: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/8.jpg)
![Page 9: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/9.jpg)
![Page 10: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/10.jpg)
![Page 11: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/11.jpg)
![Page 12: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/12.jpg)
Crude Oil In The Rockies
![Page 13: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/13.jpg)
What Has Happened to Rockies Crude Prices??
• Rockies production increasing• Express Pipeline capacity increased in 2005
adding approximately 110,000 of potential additional Canadian crude
• Export pipelines approached capacity in late 2005
• Suncor refinery fire eliminates demand for 60,000 Bopd
• Refinery turnarounds and low sulfur diesel requirements exacerbate the problem
![Page 14: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/14.jpg)
Regional Crude Production is Growing in Some States
020,00040,00060,00080,000
100,000120,000140,000160,000
BOPD
2004 2005
Utah
Colorado
Montana
N Dakota
Wyoming
EIA
395 MBOPD 424 MBOPD
![Page 15: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/15.jpg)
Current Status of Infrastructure
![Page 16: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/16.jpg)
Production/Refinery Balance
Oil Production Refinery Capacity
Montana 89,000 181,200
North Dakota 93,000 58,000
South Dakota 4,000 0
Wyoming 139,000 152,000
Nebraska 7,000 0
Utah 43,000 167,350
Colorado 54,000 87,000
Subtotal 429,000 645,550
Available Refinery Capacity 216,550
Export via Enbridge in N Dakota 78,000
Export via Platte in Wyoming 143,000
Canada (Import capability via Express) 280,000 0
Source: EIA
![Page 17: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/17.jpg)
The Law of Supply and Demand
Wikipedia
![Page 18: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/18.jpg)
WTI $60.75OK Sweet $60.75
WY Sweet $35
KS $55.75
Prices on 3/23/06
The Crude Market a Few Months Ago
![Page 19: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/19.jpg)
Platts – North America Crude Wire
The Market Today
![Page 20: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/20.jpg)
The World Might be Fine but for the Fact that …….
![Page 21: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/21.jpg)
Canadian Association of Petroleum Producers (CAPP)
![Page 22: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/22.jpg)
Canadian Association of Petroleum Producers (CAPP)
![Page 23: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/23.jpg)
![Page 24: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/24.jpg)
![Page 25: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/25.jpg)
![Page 26: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/26.jpg)
Solutions to Crude Oil Bottlenecks in the Rockies
![Page 27: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/27.jpg)
The Future is Rail?
Commodity: Fuels
Search Date: 2006-04-10
Route: BNSF
Tank Cars
Shipper Owned/Leased Zero Mlg.
Destinations Origin: GUERNSEY,WY Transit Time
NORMAN, OK $2794 N/A
per car
Standard tank car is 23,500 gallons or 525-550 Bbls.
![Page 28: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/28.jpg)
Current Proposed Expansions are a Band-Aid to Long Term Development Efforts
Kinder Morgan Platte Pipeline (added pumping capacity)15-25,000 Bbl/D $1.50 per Bbl tariff (new shippers only)
Enbridge (to Clearbrook, MN) 35,000 Bbl/D $0.15 per Bbl tariff (all shippers)
![Page 29: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/29.jpg)
Near term (2 yr)
Kinder Morgan Pony Express Re-conversion up to 200,000 Bbl/D
![Page 30: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/30.jpg)
The Plan to Convert from Crude to Natural Gas
![Page 31: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/31.jpg)
Cost of a Reconversion
• Natural Gas Contracts $124 million• Reconversion Cost $115 million• Cost Allocation to Existing Pipe $100
million?
• Total Cost to Convert $339 million
![Page 32: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/32.jpg)
Follow an NGL Line to Cushing?
Add in El Paso Medicine Bow to get you north and central.
![Page 33: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/33.jpg)
Grass roots pipeline from Wyoming to Cushing, OK 400,000 Plus Bbl/D – Up to $1.2 billion
Longer term (3-5 yr)
![Page 34: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/34.jpg)
Solutions Require Commitments
• Long Term Commitments to Capacity
• Support of Canadian Imports to Anchor a Solution
• Support and Commitment of Refiners to Buy Wyoming Crude
• Support of Producing Community to “get behind a common solution – quickly”
![Page 35: Natural Gas & Oil Infrastructure in the Rockies An Update JOINT MINERALS, BUSINESS AND ECONOMIC DEVELOPMENT COMMITTEE Casper, Wyoming May 25, 2006](https://reader035.vdocuments.us/reader035/viewer/2022062713/56649ce35503460f949af856/html5/thumbnails/35.jpg)
Wyoming Pipeline Authority
Bryan HasslerExecutive Director
303-748-6473152 North Durbin Street, Suite 230
Casper, Wyoming 82601Office (307) 237-5009Fax (307) 237-5242
www.wyopipeline.com