February 26, 2014

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Contact:
Chamois Andersen
Communications & Public Outreach
(307) 766-2286 x231
chamois.andersen@wyo.gov


Wyoming’s Geologic Wonderland Provides Energy for the Nation

Wyoming provides the nation with reliable and cost efficient energy, while also responding to a constantly changing energy environment. The Wyoming State Geological Survey (WSGS) today released its annual energy report series highlighting the state’s energy trends in supply and demand. Wyoming oil continues its upward trend, natural gas has declined but could increase as new developments come online, the coal industry is in a state of flux, and uranium production has doubled in the last year.

“From a geologic standpoint, the state is rich in the key energy resources that the nation relies on to support manufacturing, heat homes, and provide electricity,” says Tom Drean, director of the WSGS.

The WSGS annual report series covers a range of topics on Wyoming’s energy resources, from the geologic formations where the fossil fuels were originally discovered, to technological advances in drilling and mining operations. The WSGS provides its energy reports each year to the Wyoming Legislature during its session. Copies are also available at the WSGS headquarters in Laramie as well as in downloadable pdfs on the agency’s website (click here).

“If Wyoming stopped producing coal, natural gas, and uranium, significant portions of the U.S. would go dark in a couple of months,” Drean says. All together, Wyoming’s energy resources produce about 10 quadrillion Btus (British thermal units) of energy each year. “This is a significant amount of energy,” Drean says. One Btu is approximately equivalent to the amount of heat created by burning one matchstick. A 20-minute shower takes approximately 44,000 Btus. A gallon of gasoline for a car contains about 125,000 Btus. Generating electricity, heating water, and providing for a variety of industrial processes all require different forms of energy. (Click here for map of Wyoming’s energy resource production by Btus).

Coal is the largest domestically produced source of energy in America and is used to generate more than half of the nation’s electricity. Wyoming is the top-coal producing state in the nation. In 2012, the state produced approximately 401 million tons. Although the Powder River Basin provides the lion’s share of all coal sales to U.S. markets, 2013 estimates indicate that the state’s production fell by 3.3 percent from 2012, from 401 million tons to 388 million tons. This drop is largely attributed to low natural gas prices that have resulted in many utilities switching from coal to natural gas-fired power plants. A decrease in demand for electricity nationwide was also noted as a factor. “The future use of Wyoming’s coal seems certain but the question is just how it will be used,” says Chris Carroll, coal geologist with the WSGS.

“Compared to other coal deposits in the U.S., Wyoming’s coal is a low-cost, low-sulfur resource,” Carroll says. “What has already impacted Wyoming’s coal production are the more stringent limits on carbon dioxide power plant emissions from new coal-fired power plants which has led to fuel switching to natural gas,” he says. “However, if Wyoming can increase its export options, particularly to countries in Asia and India where demand for high-quality low-sulfur coal is increasing, production of the state’s coal could continue to grow,” he says. Carroll also noted that the inexpensive cost of mining Wyoming coal has led to lower U.S. electricity rates in general. “Coal-fired electric power is not subject to as much price volatility as natural gas.”

There are a number of factors that determine whether an energy resource will increase or decline in production, including national demand, competition, and pricing. The same is true for Wyoming’s oil and gas resources. Oil is on track to continue to grow, while natural gas remains in a steady decline. In 2012, more than 57.5 million barrels of oil were produced in Wyoming, and a total of 2.2 trillion cubic feet of natural gas (fifth nationally).

“In 2013, there was a significant increase in oil production, especially in Converse, Campbell, and Laramie counties,” says Rachel Toner, oil and gas geologist at the WSGS. “We believe this increased production is primarily because of new drilling technology and the development of unconventional plays.”

More than 63 million barrels of oil were produced from Wyoming reservoirs in 2013, up nearly 10 percent from 2012. However, natural gas production has declined by approximately 8 percent since 2012.

The WSGS created and regularly updates a map with information on new oil and gas projects on federal lands in Wyoming (click here). “This map is useful because it shows the locations and details of each new development project,” Toner says. “Many of the larger projects are targeting natural gas fields, and if developed could help offset Wyoming’s declining gas production.” Currently, 17 projects are in the federal permitting or early development phase.

There are also a number of uranium projects soon to come out of federal environmental review processes. In 2011, the state had two active mines. That number doubled to four active mines in 2013. Final numbers for yellowcake production in 2013 will likely exceed 2.5 million pounds. “This number will increase as more mining operations come online this year,” says Robert Gregory, uranium geologist of the WSGS. “Nuclear power is becoming more attractive as an energy source because it is clean and over the long run, may be more reliable than other fossil fuel resources,” he says. The United States is currently a net importer of uranium. Forecasts point to a large gap worldwide between primary supply and demand. “With new operations in Wyoming, the state could help fill this gap when it comes to U.S. demand,” Gregory says. Wyoming has the largest uranium reserves in the U.S. This resource was concentrated in Wyoming’s basins by water carrying it from volcanic and granitic source rocks.

Wyoming’s basins – vistas of low buttes and mesas with sparse vegetation – hold the state’s wealth in these energy resources. Along the edges of the basins are layers of sedimentary rock that contain, among other minerals, limestone, gypsum, and bentonite that are suitable for mining. Farther out in the basins are uranium deposits and coal fields, and the strata within the basins act as reservoirs for oil and gas. Wyoming’s basins are what many consider geologic wonders and continue to be viable sources for the nation’s energy needs.

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