Roan Plateau gas could be worth billions
October 17, 2007
DENVER – Natural gas drilling on Colorado’s Roan Plateau could mean as much as $1 billion for Colorado state government within a year, according to a study released Wednesday by a group that promotes domestic energy production.But the governor’s office, the state Department of Natural Resources and environmental groups said the Americans for American Energy findings were questionable.The study said U.S. taxpayers stand to gain a total of about $2.4 billion in the first year the plateau’s U.S. Naval Oil Shale Reserve is leased, with about $1.2 billion of that going to Colorado.State government could see another $5 billion to $6 billion in royalties and production taxes over the next 30 years, the study said.”There is a lot of opportunity for the state of Colorado to realize a win-win here,” said Greg Schnacke, who heads Americans for American Energy.Schnacke said the state could harvest vast natural gas resources – enough to heat every home in Colorado for 25 years – and still preserve 52,000 acres of largely undeveloped land on the plateau.The Roan has become a major natural resources battleground. Home to some of the state’s most wide-open spaces for hunting and recreation, it also has several trillion cubic-feet of natural gas.Gov. Bill Ritter’s spokesman, Evan Dreyer, questioned the credibility of Americans for American Energy.”So we are extremely skeptical of any study or any statistic it offers as ‘fact,”‘ Dreyer said. “That being said, the Roan Plateau does represent revenue to communities and to the state, and we are very attune to that.”Department of Natural Resources spokeswoman Deborah Frazier said the study had scant detail on how it was conducted and pointed out Americans for American Energy represents oil and gas interests.”We don’t know what method they used,” Frazier said. “We don’t know what data they used …. We do know they had a financial interest.”Wilderness Society economist Peter Morton called the study “junk science.””They use the figure $7 per thousand cubic feet” for the estimated price of gas,” Morton said. “Last week, gas was selling at less than $1.”A separate energy group, however, vouched for Americans for American Energy’s numbers.”The AAE report accurately reflects the financial and social benefits of leasing the (U.S. Naval Oil Shale Reserve for natural gas development,” Marc Smith, executive director of the Independent Petroleum Association of Mountain States, said in a release.A 1910 executive order set aside federal land there as Naval Oil Shale Reserves No. 1 and 3. Proponents say the land was transferred from the Department of Energy to the Interior Department in 1997 with the understanding that it would be leased for oil and gas. In recent years the area had been referred to simply as the Roan Plateau, but groups promoting domestic oil production recently began referring to the area as the Naval Oil Shale Reserves.Schnacke defended the methods and the results of the study, saying energy industry representatives participated because of their expertise.”We asked industry experts whose job it is to evaluate this kind of thing for their companies,” he said.He would not name them because he said the organizations they represent may bid on gas leases on the plateau.Sen. Wayne Allard, R-Colo., who has introduced legislation intended to make sure Colorado sees its share of any Roan Plateau money, praised the study.”This study just contributes to the widely held sentiments in Colorado that the prevention of development in this area of our state would turn away over a billion dollars needed for local communities,” Allard said in a written release.”It is wrong to decline to allow development that will increase our domestic energy supplies in a responsible manner and bring much needed revenue to the state,” he said.