San Juan Newsletter, XXX 2000
Executive Summary
Following is an overview of activity in the San Juan
Basin. Gas volumes produced in the San Juan Basin averaged 4,196 MMcf/d for the third
quarter of 1999. Average coal seam volumes for January were 2,858 MMcf/d. In January 2000,
flows from the San Juan Basin to El Paso, Transwestern and PNM totaled 3,526 MMcf/d, which
is 71 MMcf/d less than in January 1999 and 179 MMcf/d more than in January 1998. Spot
prices at the Blanco Hub for February were in the $2.46-$2.55 range, with an average spot
price of $2.51 per MMBtu. During the month of January, there were a total of 61
“Notices of Intention to Drill”, 8 workovers, 59 gas well completions, 2 oil
well completions and 27 plugged and abandoned wells
Background
The San Juan Basin is one of the most prolific gas
producing regions in the country, located in northwestern New Mexico and southwestern
Colorado. It is roughly a circular area of about 15-20 thousand cubic miles of sedimentary
rock. The basin currently produces just over 4 Bcf/d. Over 26,000 wells have been drilled
in the basin, with approximately 20,000 wells currently producing. They range in depth
from 2,000 feet to over 7,500 feet. The major producing formations in this basin are the
Dakota, Mesa Verde, Pictured Cliffs and the Fruitland coal. Current remaining recoverable
reserve estimates for northwestern New Mexico are 12.9 Tcf. The development of the
Fruitland coal seam resource starting in 1988 dramatically changed this basin. Currently,
almost 65% of the total production from this basin is from this one resource.
The extension of the TransColorado Pipeline into
northern Colorado started operating the beginning of April. To date, there are three
interconnects in northern Colorado on TransColorado Pipeline, which connects northern
Colorado to the Blanco Hub. These interconnects are with Questar Pipeline, Barrett
Resources, and Colorado Interstate Gas. During January, Questar was the only active
receipt point, with gas volumes averaging only 18 MMcf/d, which is 1 MMcf/d less than in
December. |
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