Explore the Issues:

Native Americans

Wildlife and Sportsmen

Oil and Gas Exploration

Protecting the Past

Interview with Duane Zavadil Vice President Government and Regulatory Affairs, Bill Barrett Corporation

Nancy Green: Duane, describe the Bush Administration's stance when it comes to oil and gas development.

Duane Zavadil: Well, I think it’s as much a consequence of the economic picture and response to that economic picture that we've lost about 3% of our supply of the natural gas. And the market is responding to that loss of supply and increase in prices with the demand to go drill in the West -- to go drill and produce more natural gas.  And I think this administration is trying to allow that to happen, to increase the supply of natural gas such that we can drive the prices back down to a level that is affordable for our society.

Nancy: You've mentioned the irony that although the administration has a mandate to increase leasing, the overall process has gotten tougher, explain that.

Duane: Although the number of wells that are being permitted is greater than it has been, over the course of the last ten years, the difficulty in getting an individual permit is much greater--the time required to obtain a permit, the number of law suits that we see, sort of the attention being paid to the energy business these days is much greater since the administration is purposefully paying it attention, it's become politicized such that it's more difficult from a permitting standpoint, although we are drilling more wells.

There are some interesting statistics on the leasing, in the mid 80's there were around 18.5 million acres leased in Utah, and as of today, there's around 3.5 million acres leased for oil and gas development.  Now not all of those acres will ultimately be developed, they're subject to an exploratory process and looking kind of where in the big pond are the fish to go fish but the attention being paid in the political aspect of oil and gas development has actually driven down the number of acres that are under lease and the activity itself although more wells are being permitted the effort that's necessary to permit an individual well and the attention being paid to the environmental assessments that are necessary for  our work is much greater than it was say ten years ago.

Nancy: So why is the Uintah Basin such a unique resource?

Duane: The Uintah Basin is tremendous warehouse or storehouse of hydrocarbons. Through a set of geologic circumstances there's: oil; gas; tar sands; oil shale; coal; just a tremendous stack or warehouse of hydrocarbons. And with improvements in technology, the pricing situation, and finally transportation--the ability to move the gas out of this part of the world via pipelines, it's really focused a lot attention on the Uintah Basin as one of those new frontiers.  It's an area to go explore where there are a lot of undeveloped resources.  And the Uintah Basin is going to be a target in the long term for exploration and development of natural gas and oil, but primarily natural gas.

Nancy: And why is Utah unique in that respect?

Duane: Well, Utah has such a blend of public land management between SITLA lands (State of Utah Institutional Trust Lands Administration), tribal lands, federal lands; there is quite a number of wilderness study areas; but also quite a number of bureaucracies that that manage the assets of the lands in this part of the world.  And for whatever reason, whatever combination of circumstances, Utah was less explored than say Wyoming or Colorado and so there's a high degree of prospectively, there's a lot of places to look and to explore, but it's difficult because of the very high degree of public land ownership.

Nancy: So why is there sudden exploration in Utah right now?

Duane: Well, I think it goes back to the pricing situation where natural gas prices have tripled over the last three years, there's a better transportation system to move that natural gas out, better tools to explore for the natural gas with the 3-D seismic.  It's the consequence of all of those things coming together. We know that Utah is in the spotlight, and we know that the resources are here.   That's been known for some time, but now we have the expertise and the pricing situation that allows us to develop those resources.

Nancy: Let's look at Range Creek, tell me about the early oil exploration in that region.

Duane: Well, starting in the 50's, and perhaps a bit in the 40's, there was recognition that this area contained oil in general. It was an oil province and there was a lot of exploration that happened early on for oil.  So there's a lot of wells that were drilled -- not many that were successful this far south in the Uintah Basin: the Range Creek area, the Nine-Mile area.  A lot of wells were drilled and a lot of wells plugged and abandoned in the futile look for oil.  But as part of that process, they mapped the sub-surface, and there are a lot of indications that natural gas was present in the sub-surface. So now we're going back where oil where natural gas wasn't a target 20, 30, 50 years ago, it in fact is a target now. And so we're able to utilize some of those old wells that were drilled for scientific data, for geologic data, and revisiting some of those old places.  And there are a number of wells that were drilled in the Range Creek region, the Nine-Mile region for exploration of oil that we're now re-entering and re-looking at those same resources for natural gas.

Nancy: What do you think the prospects of future of natural gas development are for Range Creek?

Duane: Well Range Creek is underlain by a lot of the same formations that the Tavaputs, the West Tavaputs Plateau where we're standing today is, and there are a number of wells that have been tested for natural gas production and have been productive, so it really is a matter at this point of making the decisions about how those lands could ultimately be developed that would dictate the degree of development. But it is highly prospective for natural gas.

Nancy: Do you think there's a way for all of the different interests to co-exist here? 

Duane: I really do.  I think that oil and gas development can be compatible with essentially every other multiple use, be it observing view shed, wildlife, cultural resources. Between developing directional drilling, careful location of sites--in the case of Range Creek where you have a narrow canyon perhaps the traffic could be kept out of the canyon itself and the resources beneath the canyon developed with directional drilling technology. So I think you can develop the bulk of those natural gas resources without insulting the sensitivities or the sensibilities of the typical conservationist.

Nancy: Do you think you've done that in nine mile?

Duane: I think we've satisfied most folks, I think you can satisfy most ethics; we can't satisfy a wilderness ethic. And ultimately you have to have access to the land, you have to build roads and well pads and stand up drill rigs, and if you're idea of ideal public lands management is absolute conservation, absolute wilderness management prescription, there is a degree of incompatibility there.

Nancy: So what do you say to people who say we should keep these areas pristine?

Duane: Well I think it's ultimately a matter of economics.  We have limited number of areas where we can develop domestic natural gas. Right now we're producing about 98% of the gas that our country consumes on the North American continent.  Some of the traditional gas producing basins are on decline.  We have moratoria off the coasts of both the east and west coasts, the North Alaskan gas pipeline isn't slated to deliver gas to the US for at least ten or twelve years.  So it really is a matter of where can we find these find this gas. And we’re honestly not looking for the most pristine areas, it really is just a consequence of where the gas accumulations are, and I think there's a decision that needs to be made by the public about how high do we allow gas prices to go, what's our tolerance level for import of natural gas, and what's our tradeoff.

Nancy: What do you say to the archaeologists in Range Creek who are concerned about oil and gas development?

Duane: Well, I think in the case of Range Creek—a very special area, I think it would be difficult to develop the oil and gas resources in close proximity to the highest density of the cultural resources.  But it in fact is a relatively small area on the broad perspective.  As people describe Range Creek, and the area that natural gas accumulation encompass in that part of the world, I think you could exclude access to those areas where the cultural resources are most sensitive. And again, using directional drilling technology, extract even the great proportion of the resources beneath those areas as long as we're not defining a very broad area for exclusion. With directional drilling you can only drill so far horizontally or laterally and extract those resources. So in the case of Range Creek I think protections are due those cultural resources.  As long as people are smart though, and pay attention to multiple resources, both the cultural resources and the oil and gas resources, I think we can see extraction of literally 80 or 90 percent of natural gas that might be there without impact to the cultural resources.