New oil wells are set to be constructed in Fort Collins, Larimer County, Colorado, as the state is recently approving an increasing number of permits for oil and gas exploration.
According to the Colorado Oil and Gas Conservation Commission (COGCC), Extraction Oil and Gas LLC is currently granting permits for a huge number of new oil wells in the state, including a prospect energy application to operate a gas well in the northern part of Fort Collins.
As of now, there are already 20 applications in the Larimer County, which is more than three times the number of drilling permits approved in the county in 2016. It is believed that the number of drilling applications across the state is rising because of crude oil prices hovering around $50 per barrel, which is up $6 from the same period last year. Aside from this, oil and gas investments are also increasing.
Energy analyst at Platts Analytics, Taylor Cavey, said that the increase in applications indicates an increased confidence in the industry. However, he does not necessarily believe that Larimer County will be crawling with new oil wells soon. He said:
“(Developers) are at a point where they’re going to pick up drilling in areas they’re familiar with. I don’t think $50 a barrel is quite enough to incentivize any exploration outside their core acreage.”
Cavey added that developers would start applying for permits in regions that have high profit potential if oil prices continue to rise.