Routt County approves Southwestern Energy's new well north of Hayden

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— The Routt County Board of Commissioners voted unanimously Tuesday to approve a drilling permit that will allow Southwestern Energy to pursue a new exploratory oil well on state land about 3.6 miles north of Hayden along Routt County Road 80.

North Hayden 1-26 is one of five exploratory wells the company hopes to drill in Northwest Colorado in 2014, two in Routt County and three in Moffat County. The results from those wells, along with more wells the company hopes to drill in summer 2015, would be used to determine if there is a commercially viable play in this region.

Oil & gas issues in Routt County

The intent of Southwestern is to frack the wells.

Southwestern vice president for the Sand Wash Basin project Doug Van Slambrouck told the county Planning Commission that his company is contemplating a projected 15 additional wells in 2015.

Southwestern spokeswoman Heather McLaughlin-Sloop said it would be fall before preparatory work can be completed and drilling could begin at North Hayden.

“I can’t imagine with construction season already starting and a bid process of eight to 10 weeks (on road improvements), that it won’t be September, October before we drill,” McLaughlin-Sloop said.

In response to a question from Commissioner Steve Ivancie about what Southwestern envisions for the future, McLaughlin-Sloop said the exploratory wells will help to bring the future into focus.

“The goal for Southwestern would be to look at these exploratory wells in Routt and Moffat counties and then come up with a plan,” she said. “When that occurs in the next two to three years, I would expect we’ll come back and say, ‘Here’s what we foresee in the next five to 10 years.’”

Southwestern is working with the town of Hayden on plans to improve roads to sufficiently allow access to the well to travel across Walnut Street north, across the railroad tracks and then out to the north along the county road.

McLaughlin-Sloop said that after consulting with a soils engineer, it has been determined that they will need to mill up a portion of the existing asphalt on Walnut and repave it.

The well is one of a number of wells in process that Southwestern acquired in a larger transaction with Shell Oil and Quicksilver Resources that closed this year, and according to county planning staff, Southwestern has agreed to all of the conditions of approval that Shell had agreed to before the sale.

McLaughlin-Sloop said in the case of the North Hayden well, Southwestern intends to use Shell’s existing in-stream water right in the Yampa River to access the modest amount of water needed in the drilling process and a more significant amount of water for fracking, possibly by trucking it to the well pad. Another possibility, she said, is delivering water through a plastic pipe running up a drainage ditch to the well, if access to the river across private property can be arranged.

Colorado law requires that Southwestern test water sources within a half-mile of the well, and although there are no existing water wells within that radius, Southwestern has agreed to extend the testing area to a 1-mile radius in order to take in two wells and a stream.

Access to the well pad site also will be limited in winter and spring because of sensitivity to grouse breeding leks and important elk range.

Ivancie and commission Chairman Tim Corrigan agreed that Routt County has a good regulatory foundation for ensuring energy exploration here goes forward in a responsible way.

“We have a robust set of conditions, which, if held to, will produce a good result,” Corrigan said.

“If this does play out, it could be a very bright future for the industry and the county,” Ivancie said. “But we have to mitigate the impacts. The template we have here is good. I’m optimistic you (Southwestern) will follow through.”

To reach Tom Ross, call 970-871-4205, email tross@SteamboatToday.com or follow him on Twitter @ThomasSRoss1

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