NEW OIL RUSH PROMPTS HUGE
GEOPHYSICAL SURVEY

CASPER — A huge, 300-square-mile geophysical survey related to the new rush on Wyoming oil is under way in Converse County. It’s the precursor to what could be significant drilling activity in the area, and some landowners want to know more about potential surface impacts.

The Powder River Basin Resource Council — a Sheridan-based landowner advocacy group — has organized a landowner workshop for July 28 at the Converse County Courthouse in Douglas in response to local interest.

The workshop features speakers Tom Toner, an attorney with Yonkee & Toner, LLP; Tony Perlinski of the University of Wyoming Department of Renewable Resources; and Don Spellman, a Campbell County rancher.

WHEN: July 28, 7-9 p.m.
WHERE: Converse County Courthouse, Douglas

PIPELINE GETS KEY APPROVAL

CHEYENNE — A $3 billion gas pipeline from Wyoming to Oregon has cleared its last major regulatory hurdle, and its builder is optimistic that work could begin soon.

El Paso Corp. says it has begun staging equipment and pipe sections near the 675-mile route, company spokesman Richard Wheatley said Tuesday. The U.S. Bureau of Land Management approved and granted rights-of-way for the project Monday.

“We can mobilize workers and work camps to begin clearing and grading operations as soon as we get final regulatory approval,” Wheatley said. “We’re in good shape.”

Houston-based El Paso expects final Federal Energy Regulatory Commission approval within days, he said, and construction would begin soon after. The pipeline will begin in western Wyoming and cross northern Utah and Nevada before ending at Malin, Ore. Up to 5,000 workers will work on the project at Opal, which will begin in seven locations along the pipeline route.

El Paso expects the 42-inch pipeline to become operational in March of next year.

LEGAL QUESTIONS ARISE OVER METHANE WATER

CASPER — State regulators say they must answer some legal questions about how a landowner can assume liability for reservoirs that were built to dispose of coalbed methane gas water.

On Tuesday the Wyoming Oil and Gas Conservation Commission took under advisement an application by J.M. Huber Corp. to transfer ownership — and presumably liability — of two off-channel reservoirs to a surface owner, Forrest Dunning.

Rather than fill in the reservoirs and ask the state to release its surety bond as per its permit requirements with the state, J.M. Huber said it has an agreement to transfer the reservoirs to Dunning, a Sheridan County rancher.

Dunning wants to take the money — about $70,000 — that J.M. Huber would have spent to fill in and reclaim the reservoirs and instead pay a contractor to line them with plastic and fix a seepage problem. Dunning wants to take on liability for the reservoirs and integrate them into his agriculture operation.

“Why not use it for my benefit and the benefit of younger generations?” Dunning said.

the rest of the story …

CONTINENTAL ACCELERATES NIOBRARA SHALE PLAY

Continental Resources has increased its capital expenditure budget to $1.3 billion to accelerate its drilling program and to increase its acreage positions in strategic U.S. shale plays, including the Niobrara Shale in Colorado and Wyoming.

“Our entry into the Niobrara Shale is another great fit with our long-term, oil-concentrated growth strategy,”  said Harold Hamm, Chairman and Chief Executive Officer. Continental has leased 59,071 net acres in the Niobrara and plans to spud its first well in the play by year-end 2010.

DOUBLE EAGLE ACQUIRES MORE COALBED METHANE PROPERTIES

Double Eagle Petroleum Co., Denver, acquired further working interests in Atlantic Rim coalbed methane properties in southern Wyoming with the purchase of SM Energy for $8.4 million.
Double Eagle acquired a 12.6% working interest in the Sun Dog Unit, bringing its interest to 21.54%, a 3.08% interest in the Catalina Unit hiking its stake to 72.4%, and a 1.15% interest in the Doty Mountain Unit boosting its share to 18%.

Estimated proved developed reserves associated with the working interest purchase is 9 bcf of gas equivalent. The 9 bcf does not include any additional reserves associated with proved undeveloped, probable or possible future locations which total 620 in the three units.