Since Lewis and Clark first recorded notes on Montana's resources, the "Treasure State" has developed as an economy based largely on its abundant natural resources.
There's no doubt our country's evolution into the premier economy of the world was made possible, at least in part, by the vast natural resources in states throughout the Rockies, including Montana. As a long-time participant in Montana's petroleum industry, I've seen first-hand Montana's growing role in providing our nation with the energy it demands. In the past 10 years both oil and gas production in our state has more than doubled. I've also seen first-hand the great strides our industry has made, balancing the dual goals of efficient energy development and effective environmental protection. Developing our domestic resources is paramount to maintaining our strength as a nation, and our industry will continue to meet this challenge in a responsible, safe and efficient manner.
Despite the petroleum industry's progress in innovative thinking and advances in technology, there are still attempts to convince the public that drilling is overwhelming, insufficiently monitored, and bad for the state. This kind of coverage misses the mark, going as far as to incorrectly assert that thousands of new wells are projected to cover hundreds of square miles and impact wildlife habitat, hunting, fishing, cultural sites and even public health. It's time to set the record straight regarding the surface area occupied by drilling and production operations. A typical gas well in north central Montana has a location size of 200 by 200 feet, or 9 tenths of an acre. These wells usually take two days to drill and, once production begins, the location is reclaimed with pad size no more than 30 by 30 feet, a 98 percent reduction. By contrast, a deep oil well in Richland County requires a larger pad. The drilling pad is typically 400 by 320 feet, occupying a total of 2.9 acres over 2 to 3 months. Afterwards the production area is reduced 70 percent to about 200 by 200 feet.
Since 1916, more than 39,000 wells have been drilled in Montana. Today, less than half (approximately 14,500 wells) are in production and nearly all of the remaining well sites have been abandoned and reclaimed. Since much recent conversation has focused on gas development, consider the surface impact of drilling 10,000 additional gas wells. This level of activity would temporarily disturb about 9200 acres while drilling and 200 acres while producing. A giant oilfield development might include 500 producing locations that would total 450 surface acres. Neither development example impacts a total surface area that is remotely as large as the hundreds of square miles mentioned in recent news coverage. It's clear that conservation groups and policymakers don't understand the area actually impacted by development. How can potential development on 200 to 400 surface acres significantly impact the 73,000 acres recently withdrawn from the July BLM lease sale? There is minimal additional impact of associated roads, pipelines and power lines. Most gas wells have two track access roads, which are only occasionally used. The actual well is monitored remotely using telemetry. Pipelines are buried and have minimal disturbance similar to right-of-way for fiber optics. Recently, operators have begun burying power supply lines as well to reduce potential impacts on sage grouse.
Oil and natural gas revenues are important to Montana and have been vital to many eastern Montana towns. Production taxes alone put more than $200 million dollars into state and county revenue accounts in 2006 and again in 2007. Furthermore, half of state production taxes and one quarter of federal royalties remain in the counties impacted by energy development. The remainder of this money supplements the state general fund, within which oil and natural gas production tax revenue alone are among the largest single revenue source. Resource development has always been Montana's economic way of life and continues to be compatible with sustaining our land and wildlife. The petroleum industry is evermore aware of, and proactive in, minimizing any impact to the land and wildlife in its commitment to responsible energy development. Montanans mustn't forsake our core strengths based on the fear mongering that's too often presented as fact.
Dave Ballard is the president of the Montana Petroleum Association.
Posted in Opinion on Tuesday, December 11, 2007 12:00 am
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