‘Conflict of cultures’ – gas booming out West | VailDaily.com

‘Conflict of cultures’ – gas booming out West

Sandy Shore
**ADVANCE FOR MARCH 4, 2006** Chris Velasquez watches an oil field truck drive by as he stands next to a pumpjack on BLM land near where his cattle graze on Thursday, Feb. 9, 2006 near Blanco, N.M. (AP Photo/Dave Watson)

GREELEY, Colo. (AP) – On a blustery winter day on the rolling plains north of Denver, a herd of cattle stood grazing a few yards from an idled natural gas pump in a dormant field as traffic rumbled by along a black-topped, two-lane highway.Just down the road are shopping centers and subdivisions packed with new homes, gobbling up land around this once-sleepy agricultural town that just happens to sit atop the Wattenberg gas field, one of the nation’s most productive.Ed Orr knows this land well. A rancher and developer whose family roots in Colorado date back more than a century, Orr says the real estate business is growing increasingly difficult because gas producers want access to land no matter what the plans are for the property.”The conflict of the cultures is certainly more prevalent. You have two industries that are both growing,” Orr said. “They think that we have no valid rights to get any accommodation for development use of the surface.”

Twin engines of growth – in population and within the oil and natural gas industry – are colliding in Greeley, the fastest-growing metropolitan area in the nation. Developers looking to cash in on rising land values are running into companies eager to sink more wells.Some fear another Western rush to fortune will be followed by hard times – again. But industry experts say the gas boom seems to be setting up for an extended run.The oil and gas industry has returned its focus to the Rockies thanks to skyrocketing prices and technology that make the resources easier to retrieve. Producers – including EnCana Corp., Kerr-McGee Corp., Noble Energy Inc. and Bill Barrett Corp. – are sinking traditional oil and gas wells across the West, tapping coal-bed methane reserves and are even experimenting with hard-to-get resources such as oil shale.”We’re looking for continued production increases for 10, 15 years at least and perhaps longer than that,” said Ron Gist, senior principal of Purvin and Gertz Inc., an industry consulting company in Houston. “Our view of things out to 2020 has gas production in the region continuing to increase. This is indeed a long-term trend.”Job surplus

The boom has already overwhelmed towns lacking adequate housing, social services and infrastructure, and authorities say it has led to more crime. A labor shortage is hitting energy companies and businesses trying to serve them.In bustling Rock Springs, Wyo., energy workers have filled all 1,850 motel rooms. On any given day, there are more than 500 available jobs posted with the Sweetwater County Economic Development Association, though director Pat Robbins said as many as 1,000 jobs may be open.For example, Halliburton would like to double its work force of 755 and Wal-Mart needs about 200 people to be fully staffed, Robbins said. She and her counterparts in Campbell and Natrona counties recently held job fairs in Michigan in hopes of landing laid-off auto workers.County voters, meanwhile, recently approved a tax increase to help pay for improvements including repairs for hundreds of miles of dirt roads leading to oil-and-gas operations, Robbins said. Despite the headaches, she said the town of 23,000 people welcomed the growth.”I got excited when Halliburton did their new building,” Robbins said. “Other people got excited when IHOP opened.”

Across the state in Gillette, Wyo., the labor shortage is getting acute for Robin Shea, general manager of mine equipment and services company P&H Minepro Services. In early February, he had 17 jobs open.”There are not enough people here to do the jobs that are available,” said Shea, who sent two employees to the Michigan job fairs and watched them return with 250 resumes.Less room for cowsThe boom also has taken its toll on ranchers, developers and homeowners who have little recourse when an oil company with underground mineral rights elects to drill on their land.Rancher Chris Velasquez believes his cattle have suffered because of problems associated with oil-and-gas drilling on 22,000 acres he leases east of Farmington, N.M. There has been lost forage and he has had cows killed in collisions. He said his calves have lost weight and hair.

“They have affected my operation a lot,” he said. “It’s an ongoing thing.”He isn’t opposed to energy production but wants the companies to be responsible. If the problems continue, he says he may have to sell the herd and find another line of work.Environmentalists, meanwhile, are increasingly concerned natural gas operations could threaten wilderness areas, wildlife habitat, the air and water supplies. Pete Morton, an economist with The Wilderness Society in Denver, isn’t sure how long the boom will last, given the cyclical nature of resource industry.”When you see this almost universal response of, ‘Oh, high prices are here to stay and demand is here to stay,’ that’s when you know it’s not going to happen,” Morton said. “These are the same people who were telling you to buy high tech before the bubble burst.”When liquefied natural gas imports become common and cheap gas from overseas starts flowing, he said, “boom, the Rockies lose out.”

Orr, the developer, bought property along the Poudre River west of Greeley several years ago where he wintered his cattle. As the population grew, a golf course was built nearby and then a high school, both of which made ranching more difficult.Today, he has turned that ranch into a mixed-use subdivision and become primarily a developer with a small herd of cattle. He plans to develop gas wells on his property.”There’s an agriculture way of life that you know certainly has some emotion tied to it and that you hate to see go away – but on the other hand I see it as progress and I think that change is good,” he said. “I think that ultimately all property should reach its highest and best use. In this area that is no longer raising cows.”—Associated Press writers Bob Moen in Cheyenne, Wyo., and Judith Kohler in Denver contributed to this report.—

On the Net:Energy Information Administration gas site: http://www.eia.doe.gov/oil-gas/natural-gas/info-glance/natural-gas.h tmlProducers site: http://www.naturalgas.orgVail, Colorado

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