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March 20, 2009 04:22 AM UTC

Josh Penry Just Makes Stuff Up (Vanishing Drills Edition)

  • 81 Comments
  • by: Colorado Pols

(Bumped into Friday by popular demand – promoted by Colorado Pols)

It’s been pointed out that we spend a fair amount of time these days deconstructing the activities and public statements of Senate Minority Leader Josh Penry. Our attention is variously credited to partisanship, a “man-crush,” or the simple fact that his leadership has been a string of unqualified disasters and what bleeds, as they say in the news business, leads.

Sorry to say, it’s starting to look more and more like the latter. Turning to the new oil and gas regulations now arriving in the Senate for approval…well, you know what Penry has to say about them. You’ve heard it a hundred times in fact, as he said in this recent NBC-11 report:

“Colorado is losing significantly more [energy activity] than any other state,” [Pols emphasis] said Senate Minority Leader Josh Penry, (R) Grand Junction. “There’s a strong argument to be made it’s because of these rules.”

It’s become a popular claim among Republicans in the last few weeks that Colorado has lost more drilling rigs, percentagewise, than any other state in the Rocky Mountain region. We were forwarded an email response from Penry to questions about this–is he, you know, sure that’s right?

Penry’s response to questions about this statement:

…The Piceance Basin has lost 60 percent of its rig count. The next closest is NM at about 50 percent (not coincidentally, until recently NM was also pushing over-reaching new regulations. Their Governor decided to back off, recognizing these trends). Most other regions are at 30 or 40 percent decline. Some states are significantly less than that.

The drill rig count is a matter of public record.

Thanks.

Josh

To verify this claim, Sen. Penry directed questioners to the Divestco North American Rig Counts website. And here’s what it says about the Rocky Mountain region–again, where he directed inquiries:

**We’re highlighting this section to remind readers that the reason we are citing these figures is because Penry referred people to them. See discussion below, which recovered after briefly veering into, as they say, “teh stupid.”

As the “% Drilling” column shows, the only state with a higher percentage of rigs operating than Colorado is North Dakota, and virtually every number quoted by Penry is, by his own source, bogus.

The public understands that energy companies aren’t “fleeing Colorado” because of these proposed rules, drillers are going idle because the economy, and with it the price of every commodity such as natural gas, is crashing. And if you compare what’s really happening here compared to other states, it’s clear that the proposed rules have nothing to do with these decisions. Colorado is doing at least as well as any of our neighbors.

This is why Penry is still worth talking about–it’s the unprecedented mendacity. It really is unique on a bipartisan level. It just keeps happening, like a 100-car pileup in the fog, If would be scary if it wasn’t so plainly counterproductive. They’re Googling your bullshit, Josh! Like Dave “The Resume” Balmer can tell you, just a little too late, that’s the kiss of death.

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81 thoughts on “Josh Penry Just Makes Stuff Up (Vanishing Drills Edition)”

      1. .

        any good politician knows to say something true once in a while, if only to keep us guessing.  

        Would it be fair to say Penry’s shortcoming is that he is too consistent ?

        .

  2. Let’s see now, the per barrel price of crude has dropped from $143 to about $45.  That missing digit which is the biggest one couldn’t have anything to do with the decrease now could it?  Well, duh Josh!!

    The oil companies don’t like to invest capital in drilling unless they get a serious return.  Correct that I mean a greed y return.  Ok now Josh, I learned this in econ 101.

  3. When Penry isolates the Piceance Basin and claims that activity is slowing here faster than elsewhere, he is, at best, comparing apples to oranges.

    Isolating one basin in Colorado and comparing it to rig counts in other states is not a reasonable comparison, especially when comparing the Piceance to big states like Texas.

    Overall the decline in rig counts in Texas has reached 52%, essentially equivalent to Colorado’s 51% decline.

    However, Texas is divided into 12 onshore districts. Here are the declines in some of the districts:

    District 1 = 67% decline in rig activity

    Distric 4 = 60% decline

    District 7b = 70% decline

    District 7c = 67% decline

    District 8 = 67% decline

    District 8a = 62% decline

    District 9 = 63% decline

    District 10 = 63% decline

    8 of the 12 onshore districts show declines as fast, or faster, than the Piceance Basin. Even their offshore district shows a decline of 75%.

    All data from the Baker-Hughes Weekly Rig Count, current through March 13, 2009.

  4. According to a natural gas marketing report presented by EnCana officials in Garfield County http://www.garfield-county.com… they noted the Rockies prices are generally depressed relative to other US pricing points because:

    Cause

    •Strong production growth and vast resource base given recent technology advances

    •Limited local demand -less than 25% of current supply

    •Mountain terrain presents challenges for drilling and building infrastructure (high-cost environment)

    •Timing disconnect between new supply and new infrastructure

    •Constrained export capacity to consuming regions

    Effect

    •Lower regional prices complicate the capital allocation process

    •Field development plans must include infrastructure cost and timing

    •Producers need to drive proactive long-term solutions “Wait and see” approach too risky

    Lack of pipelines to major markets, depressed prices and demand, and mountain terrains are the reasons why the drilling companies are pulling back across the Rocky Mt Region.

    Certainly, Sen. Penry is just looking out for his O&G pals, who are poised to pour millions into 527’s to defeat CO Democratic candidates from county commissioners to US Senators in 2010. The fight won’t be over with HB-1292.

    1. Somehow, Gary Harmon allowed some facts to enter into his story (that refute COGA’s lies argument):

      Natural gas from Colorado at the distribution hub in Opal, Wyo., was getting $2.40 per 1,000 cubic feet, or mcf, said Theo Stein, spokesman for the Colorado Department of Natural Resources, the umbrella agency that includes the commission writing the new rules.

      Figures supplied by the state geologist suggest that the price fetched by Piceance gas is less than a third of what drilling companies need to make a 10 percent profit.

      EnCana, one of the most active drilling companies, needs a price of about $7 per mcf to clear a profit.

      IHS, an energy analysis company with offices in Englewood, estimates that a drilling company needs $10 per mcf, Stein said. [emphases added]

      Energy companies are unable to sell their product for a profit. So they are slowing down how much product they are making. The (not yet implemented) new rules would add a few pennies to the cost of production. So it is clear that the new rules are a very very very minor component of the drilling slowdown.

      1. Colorado’s fuel minerals are all so prone to boom and bust because Colorado is a high cost source for all them, so it is only profitable if fuel mineral prices are near the peak.

        Colorado law requires coal right owners to underground mine in many circumstances when Wyoming coal right owners can stripe mine.

        Colorado has lots of oil shale, but oil shale is much more expensive to extract oil from than ordinary oil resources (hence the oil shale bust of 1983 on the Western Slope when oil crisis prices had subsided).

        Ordinary oil and natural gas resources in Colorado are expensive for the same reason that deep offshore drilling is expensive.  It is simply hard to get.  Places like Texas and Saudi Arabia have huge pools of oil that are relatively shallow and easy to drill.  Colorado’s reservoirs of oil are small and harder to get at.  When oil and gas prices are low, say $20 a barrel for oil, these cheap sources are the only ones that make economic sense.

        The other trouble with having high cost oil and gas resources is that there are alternatives to direct extraction that make economic sense at high prices, say over $50 a barrel for oil.  Biodiesel, ethanol, vegetable based machine lubricating oils, and the process that converts coal to a synthetic gas that can be used in place of extracted natural gas all start to look economically attractive at prices similar to those that make oil shale and high cost Colorado resources look attractive.

        The alternative fuel industry has a longer lead time to get into production than high cost oil and gas extraction, so Colorado’s oil and gas resources are well suited to be profitable during brief oil price spikes like the one we were just through.  But, if we get sustained high cost oil, as economists who talk about the Peak Oil phenomena predict we will sooner rather than later, alternatives will place a cap on how profitable Colorado’s high cost oil and gas resources can be.

        For example, if oil stays over $100 a barrel for many years, biofuels and coal conversions are going to end up being considerably cheaper as a means of meeting demand, than high cost Colorado extraction resources, so alternative fuels will be used to replace extracted oil and gas as quickly as the economy can manage it.  Once the alternative fuel industry manages to ramp up, the cost of producing these alternative fuels will place an effective cap on the price people are willing to pay for oil and natural gas.  Realistically, high oil and gas prices may sustain Colorado’s oil and gas indusry for a decade or two if those high prices return, but that isn’t an industry that will last forever (and, of course, they aren’t making new directly extractable oil and gas, so once it is gone it is gone, and the industry with it).

  7. but it’s amazing to me that they continue this charade every week; when there’s such a staggering amount of evidence that contradicts it.

  8. that Penry is just really bad at math and can’t understand the chart he directs constituents to read as evidence? If you add the “down” and the “total” column for New Mexico, the results clearly show a 52 percent decline — the numbers are right there!

    1. I would hope your readers are sophisticated enough to see right through this.  Josh cites a 60% decline in the Piecance Basin.  That’s accurate.  Pols then uses an apples to oranges figure, citing statewide statistics.  The fact of the matter is that the Piecance Basin is the epicenter of the most onerous rules.  Rigs on the Front Range face far less government interference and have thus seen lesser declines.  Are lower commodity prices partly responsible for the declining fortunes of oil & gas in Colorado?  You bet ya.  No one argues differently.  But the regulations are having a real impact.  And the statistics show it.  Colorado Pols is being very intellectually dishonest here.  

      1. the Timing Limitations that apply to critical winter range across the Piceance in calculating your ‘decline’?  

        Please present information showing the seasonal decline in drilling due to these and other factors, overlaid with the economic-caused decline in rigs…

        Oh wait, it’s KK, silly of me–never mind.  Just keep repeating the talking points kids.  Hope you don’t live in Ft. Lupton….

          1. Colorado went from 60 rigs in October to 47 in January 2005; was this because of the Rules coming into effect five years later?  

            No, its because drilling in the Piceance declines each Winter.  To be accurate–not that Sen. Penry is intersted–one would need to factor in the regular rate of decline of rigs in the Piceance between October and March.

              1. in Colorado or the Piceance?

                No, I am not changing the subject.

                I am saying that you (and Penry) are looking at the numbers as if drilling started in September 2008 rather than looking at 1) drilling rigs were at an all-time historic high in 2008, so–yeah–they are probably not going to stay there forever, and 2) there is a decline every year, seasonally, in the Piceance.  

                To make the argument that you are trying to make, one would have to overlay these historical trends over the decline of rigs all over gasfields all over the nation (and world) to develop a meaningful analysis.

                In other words–what is the normal rate of decline in Winter months in the Piceance looking back to 2004 or 2005 or so (when the last boom really kicked into gear); what is the average rate of change (again over the same period) in the state’s you are comparing Colorado too, overlaid with the rate of change 2008/2009.

                I know, I know, it’s high school level math and all so it’s probably hard for you to grasp.  Keep trying, then come back when you’ve done your homework.

              2. Penry said active rigs in Colorado fell more than in other states and attributed it to the new, onerous rules. It’s basically the same numbers — 60 percent dropoff vs. 58 percent dropoff — whether he’s talking about the P. Basin or the state as a whole. That’s simply not true — drilling fell off at even greater rates in Utah, New Mexico and Wyoming, CONTRARY to what Penry asserts. The source Penry cites contradicts what he said. It’s that simple.

              3. It feels harder than it is.

                Just say:

                ok, I was wrong about the new regulations affecting drilling and maybe Penry is too.  I still oppose the new regulations and I still think <_____>.

                And now you have some credibility.

                Then, after repeated incremental build-up of credibility your opinion and thoughts will actually have a chance to lead.  I know, it’s hard. The partisan sugar is just so sweet.

                And something in the human brain craves certainty and so is attracted to those who offer it- sometimes mistaking certainty and confidence for correctness.

            2. There are many ways to try to calculate the decline in rig numbers.

              Some, like COGA, like to pick the date when Colorado was at its peak, and use this same date for rig numbers from other states,even though this is not the peak number for that state or region.

              For example, the Colorado peak was actually in April 2008 (125 active rigs) but the Garfield County peak was Aug 19, 2008 (75 rigs). The Mesa County peak was Nov 11, 2008 (14 rigs). In contrast, Yuma County’s peak was Dec 24, 2008 (2 active rigs).

              All states and regions have different cycles of drilling activity that are influenced by weather, consumer demand, rig availability, and other activities like farming.

              So one way to look at rig activity is to see if relative numbers are changing much. For example during the boom years of 2006-2008 an average of 5.8% of the active rigs in the US were in Colorado. So far during 2009 this number hasn’t changed much – Colorado still is home to 5.4% of the active rigs in the US.

              In contrast, Texas has dropped from 46.8% (2006-08 average) to 43.7% in 2009. Oklahoma has dropped from 10.7% to 9.8%. Wyoming from 4.7% to 4.0%. New Mexico from 4.8% to 3.7%. Utah from 2.3% to 1.9%

              Thus, as a percent of active rigs in the US, Colorado has not fared any worse than its neighbors nor other major producing states of TX & OK.

              To state that Colorado is doing worse is to say something with no evidence to support it. To say that the new rules (that have not yet been implemented and that allow for the grandfathering of over 4,000 valid permits to drill) are responsible for Colorado doing worse is fear mongering and flat out lying.

              1. and what Sen. Penry is doing is recalibrating his allegations by now relying only on the rig count in one basin. Suddenly, the new rules and regulaitos only impact that one basin and therefore, the state government should be blamed for the decline in active rigs. Just a few weeks ago, he was claiming the new rules were causing the decline of drilling statewide, even though, as you point out, they aren’t even operable yet.

                He can’t prove his point, so he moves on, redefines his argument based on different allegations, while all along attempting to make us believe it is the same point he made over the past three months.  More importantly, this latest version shows he is at the end of his rope and is cornered by his own mendacity. On this issue, his ship is sinking beneath the waves and he, in a last desperate attempt, is making a smoke screen to try and make us believe his argument is still sea worthy. All we need do is wait a few minutes and we’ll see his ship is gone, sunk by its own captain.

                1. Penry lied. This is what he said, quoted by Pols. “Colorado is losing significantly more [energy activity] than any other state.”

                  He’s didn’t say the “Piceance Basin” on TV, he said “Colorado.” And Pols went to his own source and found the numbers say the opposite.

                  What the hell is going on here? This is so easy to understand-why are these shills trying to defend it? And this might be the quickest thread yet to descend into “take my brain out so we can be even” ad hominem silliness, a clear indicator that they have no intention of intelligently debating this. Which makes sense because there is nothing to debate.

                  Seriously guys, report back to headquarters for a new game plan, this one isn’t working.

      2. “Colorado is losing significantly more [energy activity] than any other state.”

        You mentioned something about “intellectual dishonesty?” Please explain how that quote is somehow confined to one specific area of Colorado, or otherwise in any way truthful.

        1. If you want to have a debate, Pols, let me take my brain out so we can start even.  First, note that most companies (maybe all, but I can’t say that for sure) drilling in the region have cited the rules as a barrier to drilling.  Here’s just one example: http://www.gjsentinel.com/hp/c…  Why would they make this stuff up and go to war with the Governor for nothing?  Second, if you use the chart that you cite, then Idaho and SD have lost the most energy activity!  That’s because you rely on percents, not the number of rigs, or even better yet, the amount of oil and gas captured (different rigs are different size).  

          1. The companies cite the rules as a barrier to drilling! Well, stop the presses!

            Of course the companies don’t want new rules. Who’s disputing that? Every business would prefer to operate unfettered. How’d that work out for the financial services industry?  They had a field day and the public interest suffered. The fact an industry decries rules — and spends money fighting them — more than likely means the public has a vital interest at stake, not that the industry knows best and we should just take their word that the rules are ill-conceived.

            1. the rules can be fairly characterized as reducing oil and gas profits.  Otherwise, why would the companies object to them.  Lower profits are caused by lower revenue.  Lower revenues don’t just reduce profits (in most cases), they also reduce the number of employees!  That’s the crux of the whole debate.  Bill Ritter’s regulations are costing Colorado jobs.

              1. Bill Ritter’s regulations are costing Colorado jobs.

                Except for the “minor” fact that you have absolutely no evidence that the (not yet implemented) new rules have had a significant effect on drilling and production activity.

                The number of active rigs in Canada has declined by 66% (a drop of 427 rigs). To what do you attribute this? Why have rigs dropped in Canada at nearly the same rate as the Piceance Basin?

              2. How many oil & gas jobs have been lost due to the new regulations that aren’t even operable yet and how many have been lost due to the economic conditions. Since your so sure about this, you can certainly be specific.  

              3. I’m saying that every industry objects to rules because no one wants to be told how to operate. Nothing wrong with that, it’s human nature. But luckily for the rest of us, everyone else — landowners, the tourism industry, hunters, conservationists, people who don’t want flames shooting out of their spigots — also have a say.

                The crux of the whole debate is whether Penry is making shit up. Josh Penry’s lies are costing him credibility.

              4. a few pennies additional cost per mcf.  When natgas goes back up in value as a commodity, drilling rates will increase accordingly, which is why oil and gas companies are continuing to invest in Colorado (completing pipelines and other new facilities for instance) and announcing plans for new projects and continued activity.  

                The few extra pennies in cost that might result from these rules that are implemented in the future (not withstanding the thousands of permits already approved to drill under the current regulations) have NOTHING to do with the CURRENT layoffs in the gasfield.  

          3. KK asks:

            Why would they make this stuff up … ?

            But then you step out and claim:

            That’s because you rely on percents, not the number of rigs …

            You should cut your losses and argue what you know about. When you argue from ideology you only look ignorant. But since you asked, if we report numbers of rigs lost we end up with:

            TX: 502 rigs lost

            OK: 109  ” ”

            CO: 64  ” ”

            LA: 61  ” ”

            And how do we explain the 427 rigs lost in Canada?

            To claim that Colorado is doing worse “than any other state” is to, brace yourself, make shit up.

            1. Baker-Hughes just released rig counts for the week ending March 20, 2009.

              Since the peak rig counts in 2008:

              Canada: 75% rig decline (488 down rigs)

              Texas: 55% rig decline (538 down rigs)

              Oklahoma: 47% rig decline (103 down rigs)

              Colorado: 55% rig decline (69 down rigs)

              New Mexico: 60% rig decline (58 down rigs)

              North Dakota: 47% rig decline (42 down rigs)

              Wyoming: 48 % rig decline (40 down rigs)

              Utah: 58% rig decline (29 down rigs)

              How do you suppose Ritter is able to cause slowdowns in 28 of 36 O&G producing states? And Canada. Amazing! (Note that the 7 states showing no change had 2 or fewer active rigs per state).

            2. is the mean meatloaf that his mom is cooking upstairs.

              You boys must be pretty bored to be splitting hairs with someone ensconced in mom’s basement spewing drivel and getting responses.

              Penry would have been the perfect pick by the banks to argue against regulations on banking.  “We don need no stinkin regulations”.

          4. “Colorado is losing significantly more [energy activity] than any other state,” [Pols emphasis] said Senate Minority Leader Josh Penry, (R) Grand Junction.

            Do you see any reference to the “Piceance Basin” in that statement? Penry says “Colorado,” then pointed when questioned at these numbers which say the opposite. What is your response to that, without changing the subject please?

            Good shills know how to debate–meaning they know how to respond to the actual point made by your opponent. You, friend, are a very poor shill.

        2. I havent’ followed this issue and don’t have a dog in the fight, but the Pols posting confuses me. Penry says Colorado is losing more energy activity than any other state. Pols responds by showing data that Colorado has a higher percentage of active wells than other regional states. Penry and Pols appear to be talking about two different things.

          Penry appears to be talking about change across time — we’re lower now than we were at some point in the past. Pols responds with a current snapshot and calls him a liar. But a change analysis requires at least two data points — now and in the past. But Pols only uses one data point — now. That isn’t an analysis of Penry’s claim, it’s a separate point.

          So, what’s the time period for Penry’s claim? Click on the little down arrow next to the “current” tag on the screenshot you grabbed and pull up the data for that date. Then compare it to current.

          I did the exercise with 1/6, the first day of the year, and Colorado’s decline was higher than other states in the region. I don’t know if it’s for the reasons Penry claims or part of a normal pattern (that’s easily checked), but I think Pols needs to show the math if you’re going to claim Penry is lying.

          1. Because they’re always…er…right.  Right?  The GJ Sentinel article is interesting and very on point.  The amount of drilling in the PB has declined dramatically.  Particularly when you compare it to Utah and Wyoming…which doesn’t seem to jibe with what Pols is claiming.

            So now the GJ Sentinel is just making it up?  Break out the tin-foil conspiracy headwear.  It’s interesting that the people who are doing the drilling say that they’re leaving because of the rules.  The people who wrote the rules do not.  It seems to me that the former might have a better insight into the motivation behind the decline than the latter.

            So much for Bill Ritter’s New Energy Economy.  I see Xcel is asking for another 2% rate increase.  Won’t be long before it costs more to power our homes than it does to pay the mortgage.  I wonder if I can get a bailout for that?

                1. Excel is dropping rates on customer use of natural gas.

                  Excel is raising rates on customer use of electricity.

                  The vast majority of electricity in Colorado is generated from coal.

                  Maybe you should have read the first sentence of the story you linked to. In short, you are comparing apples to wombats.

            2. A) The industry and it’s shills–elected and otherwise–were arguing “Colorado is losing the most rigs because of regulations that have not yet been put into effect” (even though industry already has thousands of drill sites approved that it could be drilling under the current regulations).  

              B) That is shown repeatedly to be false.

              C) Industry and its shills shift their argument to focus only on ONE BASIN and compare it to other states (rather than say individual basins or districts in other states).  They don’t bother to offer any historical context that provides the necessary information and comparison to actually make the argument they are ‘trying’ to make.

              And the Sentinel’s columnist “reporter,” Gary Harmon, is hardly an objective source on these issues.  As a reporter, he might have thought–as Josh was feeding him this story–‘hmmm, what normally happens in the Piceance regarding drill rates in the winter?’  But that would have provided context.

              The change in rate of drilling always goes down in the Piceane in the winter–being home to North America’s largest migratory deer herd and home to much of the state’s critical winter big game range, and such.

            3. Again:

              “Colorado is losing significantly more [energy activity] than any other state,” [Pols emphasis] said Senate Minority Leader Josh Penry, (R) Grand Junction.

              Was reported March 12th by this GJ TV station according to the link.

              Using the link provided by Pols, the 3/10 report–just before Penry spoke–showed very little percentage difference from the current report and still showed Colorado doing better in terms of working rigs than all other states except ND (WA has one well that is running, doesn’t really factor).

              Sorry, but if you have to go back months to find numbers that don’t say Penry is a liar, when the current ones say clearly he’s a liar as he said what he said THIS PAST WEEK, the conclusion is not difficult to comprehend.  

          2. So I went back and did a year-over-year comparison. Colorado had 57% fewer wells operating in the most recent report than in March 25, 2008. Utah’s decline was similar; other regional states with lots of rigs were less. I don’t have the time or inclination to do a national comparison. But Pols’ suggest than Penry “makes stuff up” doesn’t seem supported by the data.

            1. To say Colorado is doing worse than “any other state” (as Penry did) is false, no matter how you slice the data.

              As for your comparisons, picking arbitrary dates to compare across all states and regions is risky. It is important to look at trends over years and seasons to understand what might be going on. (See Baker-Hughes for data files to support my claims below.)

              Both Wyoming and New Mexico hit their peak rig activity in the last half of 2006 and were both in decline through the first quarter of 2008. Both were starting to spike up again during the middle of 2008 until falling abruptly with the economy in late 2008.

              Utah also had hit a peak in late 2006 and then dropped back a bit in 2007 until the latter half of 2008 when rigs peaked again and then fell.

              In contrast, Colorado had been climbing in 2006-07 before largely leveling off during 2008 (and then falling fast at the end of 08).

              Each state hit their own peak in 2008 at different times. Each state has a summer/winter cycle that is a bit off from the others. For example, last July/Aug rigs were dropping a bit in Colorado but going up in WY/NM/UT. If we start there for comparisons it would look favorable for Colorado.

              So, it is important to identify each state’s peak or trough and work out from there – if speaking the truth is important.

              1. I appreciate Ardy’s work. It’s what Pols should have done in the first place. As I said, I don’t have a dog in this fight, but the original posting was pretty shallow analysis.

                1. Used the numbers that Penry recommended they use. So who is “shallow?”

                  And for that matter, what did ardy39 say here that contradicts anything Pols wrote? I believe ardy’s post began with the words, ‘To say Colorado is doing worse than “any other state” (as Penry did) is false, no matter how you slice the data.’

                  No dog in this fight, eh? Sure about that?

            2. Between the end of March 2008 and today, the percentage decline in the number of operating oil rigs is as follows:

              Colorado:  128 to 55 (57% decline)

              Kansas: 40 to 15 (62.5% decline)

              Montana:   15 to 5 (66% decline)

              New Mexico: 13 to 10 (23.1% decline)

              North Dakota: 54 to 56 (3.8% increase)

              Oklahoma: 231 to 114 (50.7% decline)

              Texas: 87 to 35 (59.8% decline)

              Utah: 44 to 19 (56.9% decline)

              Wyoming: 93 to 49 (44.2% decline)

              Apparently, the new Colorado oil and gas rules don’t have anything to do with this general decline.

              Over the entire region the decline was from 351 active rigs to 196 or a decline of 44.2%. As I mentioned below, if the new rules were really driving O & G rigs out of colorado we should be seeing a spike in new active rigs in neighboring states but we aren’t. Obviously, as others have stated in great detail, it is the decline in price that forced the decline in the number of active rigs, not the new rules.  

          3. The numbers we posted CAME FROM PENRY HIMSELF. This isn’t data we went and found. In Penry’s very own email, he cited these figures as proof of his argument.

            And that, among many other things, is why Penry’s claim is so absurd. He backed up his argument with statistics that disprove his argument, and then he sent it all out in an email.  

            1. At no time was I attempting to claim that Colorado Pols’ analysis was lacking. Given Penry’s statement and his suggested data source, COPols nailed it.

              All that I was trying to do was provide some more context (and to refute some of the attempts to move the goalposts on the part of the shills).

      3. and using that logic, why dosen’t Penry just pick one rig in the Piecance thats down and report a 100 % decline, which is a whole lot more than other statewide totals ?  

        There ya go !  And they say this guy is gubernatorial material.

        1. rant is just as dishonest as Penry’s lies.  To believe KK’s and Penry’s lies you have to assume that hydrocarbon companies are forgoing profits because of something which has not even happened yet.  The Bush recession, inadequate delivery systems and falling gas prices are the reality NOW and are not a result of the rules.  KK can attempt to spin Penry’s lie all he wants.  Reality refutes the kid.

          “A stupid man’s report of what a clever man says can never be accurate, because he unconsciously translates what he hears into something he can understand.”  -Betrand Russell

    1. Can the Fort Lupton woman claim tap rights and somehow extract the natural gas herself? It sounds like she’s missing a tremendous money-making opportunity, in this tough economy.

      1. but heating your house via the sink is a brilliant move.  Sterilize your pits, avoid buying Nair and keep the kids warm all at the same time.  Brilliant.

        “We don need no stinkin regulations”.

  10. If the new oil and gas rules were the root cause of the decline in drilling in Colorado, then our neighboring states wouldn’t be suffering any decline or very little and, as someone else pointed today, how can you explain the decline in drlling rigs operating in Canada, certainly not because of our new rules.

    Second, if the new Colorado rules are the cause, then why haven’t the oil companies just closed their rigs here and moved them to Utah, Texas, Wyoming or New Mexico. It seems logical that if the rules are the cause then there should be a spike in active rigs in our neighboring states.

    Bottom line, Senator Penry has been lying about this all along. By doing so, he really isn’t scoring any points, even with the oil and gas industry in the long run. They know he is making this up as he goes and how could they trust him in the future knowing that he is willing to lie now. Next year, he may be lying about something else and his lies are harming them.

    When a politician looses his credibility, he is finished. In the end that is all any of them have to offer us. Sen. Penry should be ashamed of himself.

    1. then drilling activity should actually be increasing in Colorado, and especially in the Piceance Basin.

      From the GJ Sentinel:

      Myth 1: Uncertainty about the implementation of new rules is driving oil and gas exploration from Colorado.

      If concern about the new rules was actually driving oil and gas activity in Colorado, every available rig would be employed drilling wells under existing permits grandfathered under the old rules. The oil and gas commission approved over 8,000 permits to drill in 2008 and an additional 1,200 permits so far in 2009. When the commission approves an application to drill a well, the permit is valid for one year.

      Since January 2008, operators have developed approximately 4,000 new active wells. Thus, there remain over 4,000 valid permits to drill wells, grandfathered under the old rules, which will expire within a year. That operators are choosing instead to idle rigs and lay off workers falsifies this myth.

    2. If Penry, or any R leadership, would Just say:

      ok, I was wrong about the new regulations affecting drilling.  I still oppose the new regulations and I still think <_____>.

      Or giving AIDS to babies, or a dozen other wackiness the minority feels free to spout. (D’s are just as nuts- explain why I would want my small electoral state to give up any significance and let SoCal and NYC choose my presidential vote.)

      They would have some credibility.

      Then, after repeated incremental build-up of credibility their  opinion and thoughts will actually have a chance to lead.  I know, it’s hard. The partisan sugar is just so sweet.

      I still wouldn’t register with either party (which means I get hosed at caucus time and vacancy filling time) but at least I’d know who has credibility.

    3. Because you’d rather have a pissing contest about a rhetorical discussion of how many drilling rigs are on the head of a pin than discuss the underlying policy assumptions.

      Business Class Bill Ritter and his friends in the legislature have sent a very strong message to them.  The cost of drilling and recovering a BTU of natural gas in Colorado will now be higher than any of the neighboring states because of compliance costs…regardless of what the market rate is.

      The result will ultimately achieve everything that the Sierra Club and their allies desire…drilling in Colorado will stop.  By pricing the cost of drilling out of the market, the oil and gas companies will move to states with friendlier (i.e. cheaper) regulatory regimes.  The objective is accomplished with less political baggage than just an outright ban.

      The only response from the Oil and Gas commission and everyone supporting the new rules has been, “No it won’t.”  And then when you can’t win that argument…call them a liar, because that’s what democrats do.

      The impact on Colorado will, in the short term, mean lost jobs as the industry pulls out.  The impact on the state budget will be increased unemployment, food stamps and other benefits as well as decreased tax revenue.  Oh yeah, that big pot of yummy severance tax money that the Legislature just LOVES to spend, that will go away too.

      The impact on the west slope will be more dramatic and immediate.  Local governments will also have increased costs and decreased revenue and will have to raise other taxes to cover the shortfall or cut services while they wait for all the jobs that Bill Ritter’s promised with his New Energy Economy.

      Long term, Colorado will become a net energy consumer rather than producer and that isn’t a good position to be in.  Ask California.  But wait, isn’t that the objective as well.  Colorado would be better if it was just a bit more like California?  No thanks.

      1. flying dinosaurs and exploding babies. Things could really get bad!

        And then when you can’t win that argument…call them a liar,

        Who says the rules proponents can’t win that argument? Your whole doomsday scenario rests on that assumption, and it’s flat-out wrong.

      2. What is complex is trying to keep up with all the changing arguments that you O&G shills keep trying out.

        The cost of drilling and recovering a BTU of natural gas in Colorado will now be higher than any of the neighboring states because of compliance costs

        This is BS. As seen in my post above, the production costs for natural gas in Colorado is already very high, without any new rules.

        The new regulations will add, at most, a few pennies to production costs -this is according to industry consultants who testified before the COGCC.  

      3. By pricing the cost of drilling out of the market, the oil and gas companies will move to states with friendlier (i.e. cheaper) regulatory regimes.

        Oil and gas are where you find them, so that’s where you do business. Did you realize that they still drill for oil and gas in California? They drill in suburban L.A.

        Y’know, Alaska is probably the most expensive place in the country to develop an oil field, but oil companies still want to drill ANWR, even after Sarah Palin raised taxes on them.

        I don’t know why all the conservatives on this site want to degrade Colorado to pad the bottom line of oil companies. Any mess that they leave behind will eventually be cleaned up at taxpayer expense.

        And about this gem:

        Long term, Colorado will become a net energy consumer rather than producer and that isn’t a good position to be in.

        Do you actually think that Colorado oil and gas will last forever? Want to buy a bridge?

      4. and as I asked KK above, since your so sure about your argument, you can certainly pin point exactly the number of jobs lost in Colorado because of the new (as yet not operable) oil and gas rules.

        Your own statement defeats your sophristy:

        “By pricing the cost of drilling out of the market, the oil and gas companies will move to states with friendlier (i.e. cheaper) regulatory regimes.”

        So if the new rules are driving the industry out of Colorado to other states, how do you explain the fact we haven’t seen any spike in the number of rigs operating in those other states?  How do you explain the fact that oil and gas drilling is declining across the entire oil patch, including Canada?

        Please answer the questions.

  11. What over reaching proposed regulations is he talking about in New Mexico? I checked out the New Mexico oil division’s website and the only rule changes that have been proposed are minor changes to the rules governing waste tanks and deepening exisitng wells in two counties. Those rule changes are still alive and up for consideration. So what specifically is he talking about or is this, as I suspect, just another one of his diversions to try and make his position look credible.

      1. So apparently, applying Sen. Penry’s line of thinking, regulations for waste pits in New Mexico, if enacted, would drive the O & G industry out of New Mexico. Years ago, I worked for one of the major oil companies in the exploration and production division and it is hard for me to believe that regulatory requirements governing the lining of waste pits will make or break any company’s decision to drill.

  12. The REAL reasons why Penry wants the new COGCC rules to go away are:

    — Mesa County put all their eggs in the energy basket – again – so local elected officials have to cover their butts and blame others as the local economy goes to hell.

    — Penry wants to be elected in some position in 2010 and needs to attract O&G-supported 527’s to fill his campaign coffers. Back-scratchers optional.

    — Mesa State has run out of jobs for his family and friends, so now he has to depend on Halliburton.

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