The economic impacts analysis for oil and gas reflects drilling, completion, and production activities. The number of wells drilled and completed is based on the Reasonable Foreseeable Development (RFD) scenario (BLM 2009a) and the constraints applied under each alternative. Total well numbers for each alternative are presented in Table X-1. Table X-2 presents the projected quantity of oil and gas produced on federal surface, and Table X-3 presents the projected quantity of oil and gas produced from federal, state, and private (fee) surface.
Table X.1. Oil and Gas Well Numbers
| Item | Conventional Infill | Exploratory Deep | Coalbed Natural Gas | Total |
| Federal Surface | ||||
| Alternative A – Wells Drilled | 934 | 111 | 85 | 1,130 |
| Alternative A – Wells Completed | 803 | 32 | 77 | 913 |
| Alternative B – Wells Drilled | 420 | 50 | 39 | 509 |
| Alternative B – Wells Completed | 361 | 15 | 35 | 411 |
| Alternative C – Wells Drilled | 1,053 | 125 | 79 | 1,257 |
| Alternative C – Wells Completed | 906 | 36 | 71 | 1,013 |
| Alternative D – Wells Drilled | 875 | 104 | 53 | 1,032 |
| Alternative D – Wells Completed | 753 | 30 | 48 | 831 |
| Federal, State, and Fee Surface | ||||
| Alternative A – Wells Drilled | 1,351 | 160 | 130 | 1,641 |
| Alternative A – Wells Completed | 1,162 | 46 | 117 | 1,326 |
| Alternative B – Wells Drilled | 837 | 99 | 84 | 1,020 |
| Alternative B – Wells Completed | 720 | 29 | 76 | 825 |
| Alternative C – Wells Drilled | 1,470 | 174 | 124 | 1,768 |
| Alternative C – Wells Completed | 1,264 | 50 | 112 | 1,427 |
| Alternative D – Wells Drilled | 1,284 | 152 | 98 | 1,534 |
| Alternative D – Wells Completed | 1,104 | 44 | 88 | 1,237 |
| Sources: BLM 2009a; BLM 2009b | ||||
Table X.2. Projected Oil and Gas Production (Federal Surface)
| Year | Alternative A | Alternative B | Alternative C | Alternative D | ||||
| Gas (BCF) | Oil (MMBO) | Gas (BCF) | Oil (MMBO) | Gas (BCF) | Oil (MMBO) | Gas (BCF) | Oil (MMBO) | |
| 2009 | 11.5 | 6.9 | 5.2 | 3.1 | 13.0 | 7.8 | 10.8 | 6.5 |
| 2010 | 11.2 | 6.6 | 5.0 | 3.0 | 12.6 | 7.4 | 10.5 | 6.2 |
| 2011 | 10.9 | 6.2 | 4.9 | 2.8 | 12.2 | 7.0 | 10.2 | 5.8 |
| 2012 | 10.5 | 5.9 | 4.7 | 2.7 | 11.9 | 6.7 | 9.9 | 5.5 |
| 2013 | 10.2 | 5.6 | 4.6 | 2.5 | 11.5 | 6.3 | 9.6 | 5.3 |
| 2014 | 9.9 | 5.3 | 4.5 | 2.4 | 11.2 | 6.0 | 9.3 | 5.0 |
| 2015 | 9.7 | 5.1 | 4.3 | 2.3 | 10.9 | 5.7 | 9.0 | 4.8 |
| 2016 | 9.4 | 4.8 | 4.2 | 2.2 | 10.6 | 5.4 | 8.8 | 4.5 |
| 2017 | 9.1 | 4.6 | 4.1 | 2.1 | 10.3 | 5.2 | 8.5 | 4.3 |
| 2018 | 8.8 | 4.3 | 4.0 | 2.0 | 10.0 | 4.9 | 8.3 | 4.1 |
| 2019 | 8.6 | 4.1 | 3.9 | 1.9 | 9.7 | 4.7 | 8.0 | 3.9 |
| 2020 | 8.3 | 3.9 | 3.8 | 1.8 | 9.4 | 4.4 | 7.8 | 3.7 |
| 2021 | 8.1 | 3.7 | 3.6 | 1.7 | 9.1 | 4.2 | 7.6 | 3.5 |
| 2022 | 7.9 | 3.5 | 3.5 | 1.6 | 8.9 | 4.0 | 7.4 | 3.3 |
| 2023 | 7.6 | 3.4 | 3.4 | 1.5 | 8.6 | 3.8 | 7.2 | 3.1 |
| 2024 | 7.4 | 3.2 | 3.3 | 1.4 | 8.4 | 3.6 | 7.0 | 3.0 |
| 2025 | 7.2 | 3.0 | 3.2 | 1.4 | 8.1 | 3.4 | 6.8 | 2.8 |
| 2026 | 7.0 | 2.9 | 3.1 | 1.3 | 7.9 | 3.2 | 6.6 | 2.7 |
| 2027 | 6.8 | 2.7 | 3.1 | 1.2 | 7.7 | 3.1 | 6.4 | 2.6 |
| 2028 | 6.6 | 2.6 | 3.0 | 1.2 | 7.4 | 2.9 | 6.2 | 2.4 |
| Sources: BLM 2009a; BLM 2009b BCF billion cubic feet MMBO million barrels of oil | ||||||||
Table X.3. Projected Oil and Gas Production (Federal, State, and Fee Surface)
| Year | Alternative A | Alternative B | Alternative C | Alternative D | ||||
| Gas (BCF) | Oil (MMBO) | Gas (BCF) | Oil (MMBO) | Gas (BCF) | Oil (MMBO) | Gas (BCF) | Oil (MMBO) | |
| 2009 | 16.6 | 10.0 | 10.3 | 6.2 | 18.1 | 10.9 | 15.8 | 9.5 |
| 2010 | 16.2 | 9.5 | 10.0 | 5.9 | 17.6 | 10.3 | 15.4 | 9.0 |
| 2011 | 15.7 | 9.0 | 9.7 | 5.6 | 17.1 | 9.8 | 14.9 | 8.6 |
| 2012 | 15.2 | 8.6 | 9.4 | 5.3 | 16.6 | 9.3 | 14.5 | 8.1 |
| 2013 | 14.8 | 8.1 | 9.2 | 5.0 | 16.1 | 8.9 | 14.1 | 7.7 |
| 2014 | 14.4 | 7.7 | 8.9 | 4.8 | 15.6 | 8.4 | 13.7 | 7.3 |
| 2015 | 14.0 | 7.3 | 8.7 | 4.5 | 15.2 | 8.0 | 13.3 | 7.0 |
| 2016 | 13.6 | 7.0 | 8.4 | 4.3 | 14.8 | 7.6 | 12.9 | 6.6 |
| 2017 | 13.2 | 6.6 | 8.2 | 4.1 | 14.3 | 7.2 | 12.5 | 6.3 |
| 2018 | 12.8 | 6.3 | 7.9 | 3.9 | 13.9 | 6.8 | 12.2 | 6.0 |
| 2019 | 12.4 | 6.0 | 7.7 | 3.7 | 13.5 | 6.5 | 11.8 | 5.7 |
| 2020 | 12.1 | 5.7 | 7.5 | 3.5 | 13.1 | 6.2 | 11.5 | 5.4 |
| 2021 | 11.7 | 5.4 | 7.3 | 3.3 | 12.8 | 5.9 | 11.1 | 5.1 |
| 2022 | 11.4 | 5.1 | 7.1 | 3.2 | 12.4 | 5.6 | 10.8 | 4.9 |
| 2023 | 11.1 | 4.9 | 6.9 | 3.0 | 12.0 | 5.3 | 10.5 | 4.6 |
| 2024 | 10.7 | 4.6 | 6.7 | 2.9 | 11.7 | 5.0 | 10.2 | 4.4 |
| 2025 | 10.4 | 4.4 | 6.5 | 2.7 | 11.3 | 4.8 | 9.9 | 4.2 |
| 2026 | 10.1 | 4.2 | 6.3 | 2.6 | 11.0 | 4.5 | 9.6 | 4.0 |
| 2027 | 9.8 | 4.0 | 6.1 | 2.4 | 10.7 | 4.3 | 9.4 | 3.8 |
| 2028 | 9.6 | 3.8 | 5.9 | 2.3 | 10.4 | 4.1 | 9.1 | 3.6 |
| Sources: BLM 2009a; BLM 2009b BCF billion cubic feet MMBO million barrels of oil | ||||||||
The costs of drilling and completing wells and producing oil and gas, also are relevant for the economic impact analysis. Table X-4 provides a summary of the costs of drilling, completion, and production for each well type (conventional infill, exploratory deep, and coalbed natural gas [CBNG]) used for the economic analysis.
Table X.4. Assumptions for Analysis of Economic Impacts for Oil and Gas Well Drilling and Completion According to Well Type
| Assumption | Well Type | ||
| Conventional Infill | Exploratory Deep | Coalbed Natural Gas | |
| Drilling Impacts | |||
| Drilling Cost ($/well) | $918,892 | $8,970,776 | $46,557 |
| Local Drilling Costs1 | 85% | 58% | 83% |
| Local Direct Impact ($/well) | $777,257 | $5,241,469 | $38,855 |
| Local Total Impact ($/well)2 | $1,033,010 | $6,691,862 | $51,617 |
| Multiplier (total impact/direct impact) | 1.33 | 1.28 | 1.33 |
| Completion Impacts | |||
| Completion Cost ($/well) | $1,317,059 | $4,152,349 | $49,124 |
| Local Completion Costs1 | 55% | 37% | 55% |
| Local Direct Impact ($/well) | $730,060 | $1,545,808 | $27,230 |
| Local Total Impact ($/well)2 | $968,092 | $1,966,596 | $38,245 |
| Multiplier (total impact/direct impact) | 1.33 | 1.27 | 1.40 |
| Source: BLM 2009b; adjusted to year 2008 dollars using chain-type price indices from IMPLAN (Taylor 2010). Data are based on Authorizations For Expenditure provided by exploration and development companies, and include the assumption that approximately 40 percent of infill and deep wells will be directional or horizontal and the remainder will be vertical. 1The local cost shares were based on the percent of total drilling or completion costs that would be spent on goods and services purchased from the local economy. 2 Total impacts estimated using Impact Analysis for Planning (IMPLAN) include direct, indirect, and induced impacts. | |||
Table X-5 provides the assumptions used to determine the economic impact associated with the production of oil and gas. For the analysis, the Bureau of Land Management (BLM) estimated a production cost (for gas) of $1.48 per thousand cubic feet (mcf), in year 2008 dollars, based on data from the Energy Information Administration (Taylor 2010).
Table X.5. Assumptions for Analysis of Economic Impacts on Output for Oil and Gas Production
| Economic Impact | Oil Production (per million barrels) | Gas Production (per billion cubic feet) |
|---|---|---|
| Direct Economic Impact1 | $65,417,0002 | $4,144,0003 |
| Indirect Economic Impact4 | $3,764,290 | $238,458 |
| Induced Economic Impact5 | $1,687,301 | $106,886 |
| Total Economic Impact | $70,868,591 | $4,489,344 |
| Multiplier (total impact/direct impact) | 1.08 | 1.08 |
| Note: All dollar values are in year 2008 dollars. 1Direct economic impact is the market value of output. 2Based on an oil price of $65.417 per barrel, which is an average of the prices for 2009-2014 projected by the Wyoming Consensus Revenue Estimating Group (CREG 2009) and adjusted to 2008 dollars. 3Based on a gas price of $4.144 per thousand cubic feet, which is an average of the prices for 2009-2014 projected by the Wyoming Consensus Revenue Estimating Group (CREG 2009) and adjusted to 2008 dollars. 4Indirect impacts from Impact Analysis for Planning (IMPLAN) reflect increased demand in sectors that directly or indirectly provide supplies to the oil and gas industry. 5Induced impacts from IMPLAN reflect increased demand in the consumer and government sectors. | ||
The forecasted number of wells and production used for estimating employment impacts is the same as for estimating impacts on labor earnings and output. Table X-6 shows the direct and total employment impacts attributable to drilling and completion.
Table X.6. Assumptions for Employment Impact Analysis for Oil and Gas Well Drilling and Completion According to Well Type
| Employment Impact | Well Type | ||
|---|---|---|---|
| Conventional Infill | Exploratory Deep | Coalbed Natural Gas | |
| Drilling Impacts | |||
| Direct Employment (jobs/well) | 3.4 | 20.7 | 0.2 |
| Total Employment Impact (jobs/well) | 5.8 | 34.5 | 0.3 |
| Multiplier (Total Impact/Direct Impact) | 1.69 | 1.67 | 1.70 |
| Average Earnings per Job (2008 dollars) | $62,004 | $60,735 | $52,448 |
| Completion Impacts | |||
| Direct Employment (jobs/well) | 4.1 | 7.1 | 0.42 |
| Total Employment Impact (jobs/well) | 6.5 | 11.2 | 0.3 |
| Multiplier (Total Impact/Direct Impact) | 1.59 | 1.58 | 1.58 |
| Average Earnings per Job (2008 dollars) | $57,141 | $57,788 | $55,860 |
| Note: Direct and total employment impact and average earnings per job are calculated using Impact Analysis for Planning (IMPLAN). | |||
Table X-7 shows the direct and total employment impacts associated with production.
Table X.7. Assumptions for Employment Impact Analysis for Oil and Gas Production
| Employment Impact (annual number of jobs) | Oil Production(per million barrels) | Gas Production(per billion cubic feet) |
|---|---|---|
| Direct Employment | 25.3 | 1.6 |
| Indirect Employment | 31.7 | 2.0 |
| Induced Employment | 19.0 | 1.2 |
| Total Employment | 76.0 | 4.8 |
| Multiplier (Total Impact/Direct Impact) | 3.0 | 3.0 |
| Average Earnings per Job (2008 dollars) | $58,157 | $58,159 |
| Note: Direct, indirect, and induced employment impact and average earnings per job are calculated using Impact Analysis for Planning (IMPLAN). | ||
The analysis of potential changes in tax revenues is based on tax rates of 12.5 percent of taxable value for federal mineral royalties, 6 percent of taxable value for state severance taxes (Wyoming Department of Revenue 2001), and 6.9 percent of taxable value for local ad valorem production taxes (based on average tax rates for the counties of Big Horn [7.3 percent], Hot Springs [6.7 percent], Park [7.1 percent], and Washakie [6.6 percent]) (Wyoming Department of Revenue 2010). Taxable value refers to value of sales minus allowable deductions, including certain costs of production and transportation. For purposes of estimating tax revenues, taxable value was estimated based on the average taxable value per unit sold from the counties in the Planning Area for production year 2008 using data from the Wyoming Department of Revenue (Wyoming Department of Revenue 2010). Taxable value was estimated as $75.91 per barrel for oil, and $6.06 per mcf for natural gas (2008 dollars).