Limits on drilling called Utah bane

Utah is losing the game when it comes to making money off vast natural gas reserves locked deep underground in the Uinta Basin, according to one Denver-based company.

On Thursday, representatives of Bill Barrett Corp., an oil and natural gas exploration company, renewed their charge that restrictive federal land use policies and bureaucratic strangleholds are slowing drilling in Utah.

The company's message comes as it prepares to file an application with the Bureau of Land Management to expand drilling operations in Nine Mile Canyon, an archaeological treasure trove of prehistoric rock art formations.

Don Banks, a BLM Utah spokesman, said the bureau is expecting a full-field development proposal from Bill Barrett Corp., as early as today. The proposal will seek expanded drilling operations and removal of winter drilling restrictions.

An environmental impact study of the proposal could take two years or longer to complete before a decision is made.

"They're proposing something in the neighborhood of 700 wells, and that's what we are going to be studying," Banks said. "They're concerned that we'll churn slowly, but we're talking about a place that has a lot of different resource values. . . . There are projects that take far longer because of where they are located. We have some of the most spectacular public lands on the planet, but we also have some of the greatest contention found on the public lands."

In the last two years, Bill Barrett Corp. has invested $100 million searching for natural gas in Nine Mile Canyon, located in the southern Uinta Basin.

Last November, the Price BLM office denied a company request to extend a lease for winter drilling.

Jim Felton, investor relations manager for Bill Barrett Corp., said the BLM denial ultimately cost the state of Utah roughly $2,900 a day in lost tax revenues and royalties in natural gas sales.

"In capitalism, efficiency gets rewarded. In government, inefficiency gets rewarded," Felton said. "You are looking at a state that really hasn't even reached its potential. Utah has drilled a third as many wells as New Mexico and Colorado and one-tenth as many wells as Wyoming. Potentially, you have the same amount of gas as Colorado, Wyoming and New Mexico."

According to 2002 data from the U.S. Energy Information Administration, proved natural gas reserves in Utah at 4.1 trillion cubic feet trail those of Colorado (13.9 trillion cubic feet, New Mexico (35.2 trillion cubic feet) and Wyoming (20.5 trillion cubic feet).