Colorado...slated for an early recovery????? (Pueblo, Greeley: unemployment, taxes, costs)

[CosmicWizard]

A couple articles related to Colorados Energy Industry.

Expert says Western Slope energy market not at bottom

The economic slowdown that hit the nation late last year and the Grand Valley this year will linger though 2009, frustrating hopes for a quick recovery, an energy-industry observer said.

Industry official pushes natural gas for cars

SILT — Promoting use of natural-gas-powered vehicles along Colorado’s major interstate corridors could clean the state’s air, save motorists money and help support the local energy economy, an industry official says.

[Josseppie]

I posted this in the Pueblo thread but decided to post it here too as this will help Pueblo get out of the current recession.



"Another potential solar energy provider is eyeing the Pueblo Chemical Depot’s sprawling acreage and proximity to power lines."

The link: http://www.chieftain.com/articles/2009/06/11/business/local/doc4a307d668d39c782785951.txt

[CosmicWizard]

Report: U.S. natural gas reserves surge 35 percent

Energy companies say the Piceance Basin is an expensive place to drill. Rocky Mountain gas is far from major markets. Pipeline capacity is limited, and the gas is sold for less than the national average price.

Don McClure, a vice president for EnCana Oil & Gas (USA), recently said the varying regional costs will be a consideration as companies make drilling investment decisions.

“That’s what the Rocky Mountains are going to face when (economic) recovery does start to occur, is the competition for capital,” he said.

[Mike from back east]

Originally Posted by CosmicWizard

Report: U.S. natural gas reserves surge 35 percent

Energy companies say the Piceance Basin is an expensive place to drill. Rocky Mountain gas is far from major markets. Pipeline capacity is limited, and the gas is sold for less than the national average price.

Don McClure, a vice president for EnCana Oil & Gas (USA), recently said the varying regional costs will be a consideration as companies make drilling investment decisions.

“That’s what the Rocky Mountains are going to face when (economic) recovery does start to occur, is the competition for capital,” he said.

Great news to know we have about 90 years worth of Nat Gas at today's rate of usage.

We could use that "lower" priced gas to run power plants here in CO, it's a lot cleaner than coal. I know that our local utility here in COLO SPGS can use both coal or Nat Gas and when prices of gas get low, they switch to it.

I'm a bit amused too, from the perspective that there's more of the stuff in the ground than previously thought, a lot of the doom/gloom types will have to delay their 'wolf at the door' predictions. Gee, we could power some cars with stuff too, ehh?

Speaking of pipeline capacity, KMP opened a major gas pipeline to the east a year or so ago (The Rockies Express), with another one due to follow in another year or so. That's why I wanted to see the severance tax go up in last year's elections, most of our gas will go OUT of state, by keeping the severance tax low means COLO citizens subsidize two groups of people: (1) Firms in the gas biz, and (2) People in eastern states who use Nat Gas. So we now starve our state budget for the benefit of OTHERS. How smart are we for that?

Every few years there seems to be news reports of major finds of oil and gas around the world. It bodes well for us all. But still, I have to wonder, is this news of 35% more gas aimed at killing off the proposed Trans-Alaska Nat Gas pipeline? Hmm.

[Ticky909]

Originally Posted by Mike from back east

Great news to know we have about 90 years worth of Nat Gas at today's rate of usage.

We could use that "lower" priced gas to run power plants here in CO, it's a lot cleaner than coal. I know that our local utility here in COLO SPGS can use both coal or Nat Gas and when prices of gas get low, they switch to it.

I'm a bit amused too, from the perspective that there's more of the stuff in the ground than previously thought, a lot of the doom/gloom types will have to delay their 'wolf at the door' predictions. Gee, we could power some cars with stuff too, ehh?

Speaking of pipeline capacity, KMP opened a major gas pipeline to the east a year or so ago (The Rockies Express), with another one due to follow in another year or so. That's why I wanted to see the severance tax go up in last year's elections, most of our gas will go OUT of state, by keeping the severance tax low means COLO citizens subsidize two groups of people: (1) Firms in the gas biz, and (2) People in eastern states who use Nat Gas. So we now starve our state budget for the benefit of OTHERS. How smart are we for that?

Every few years there seems to be news reports of major finds of oil and gas around the world. It bodes well for us all. But still, I have to wonder, is this news of 35% more gas aimed at killing off the proposed Trans-Alaska Nat Gas pipeline? Hmm.

Funny how this state works sometimes, on one hand we tend to price people out, by grinding up tax's and fee's and add-ons so high that businesses or people decide to move elsewhere. On the other hand when we do business we don't have the killer instinct to actually square up a deal.

[Mike from back east]

Originally Posted by Ticky909

Funny how this state works sometimes, on one hand we tend to price people out, by grinding up tax's and fee's and add-ons so high that businesses or people decide to move elsewhere. On the other hand when we do business we don't have the killer instinct to actually square up a deal.

Agree. The oil/gas industry painted the severance tax ballot issue as a tax increase that WE will pay at the gas pump. Plain old fear tactics. Truth is, we might not have seen any increase at the gasoline pump or for Nat Gas, as a lot of what is pumped out of COLO goes on to leave COLO. We may only have seen a penny or two rise on a gallon of gas, which is nothing compared to the $4/gallon we were paying the other year. But if you call anything in this state a "tax increase," there is a large enough segment of the voter population to sway the issue.

No one, on any side of the severance tax issue, put any stats on the table showing what states the gasoline we get at the pumps comes from (I'd bet a lot comes from OUT of state) nor what states does the oil pumped out of the ground in COLO go to. That set of stats would've been very interested. For darned sure, no one quantified just how much our prices may have gone up, if any, it was just the usual fear and smear politics.

Meantime, Coloradans are shortchanging our colleges, infrastructure and future.

The extra bucks from an increased severance tax would have aided "an early recovery."

[sterlinggirl]

Originally Posted by Mike from back east

The extra bucks from an increased severance tax would have aided "an early recovery."

A severance tax makes Colorado's gas even less profitable to export and drives down prices at the wellhead. Reduced prices at the wellhead makes drillers look to other parts of the country for a better ROI, and jobs leave with the rigs.

[Katiana]

Colorado Independent » Raising severance taxes won’t deter oil and gas drilling, says expert

Editorial: Severance tax battle looming - The Denver Post

"When both property taxes and severance taxes are considered, oil and gas producers pay an average of about of 5.7 percent on their production. By comparison, the effective rate is 9.4 percent in New Mexico, 7.0 percent in Oklahoma, 4.5 percent in Utah and 11.2 percent in Wyoming."

[Josseppie]

I am going to make a prediction then we can look back and see if I am right or not. My prediction is that in the 3rd quarter we will start to see a turn around in Colorado and for Pueblo I expect one maybe 2 big announcements.

[Mike from back east]

Originally Posted by sterlinggirl

A severance tax makes Colorado's gas even less profitable to export and drives down prices at the wellhead. Reduced prices at the wellhead makes drillers look to other parts of the country for a better ROI, and jobs leave with the rigs.

IIRC, Wyoming and New Mexico severance taxes are higher than COLO's. If we raised our rate to their rate, it would level the playing field, would it not? As it is, if we keep our rate low, they will pump us dry, pocket the money, then move on to whatever area is next lowest, leaving us holding the bag anyway. Why give it away and leave our state scrounging for money to make budget.