News Column

Kansas Could See New Oil Boom

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Another landowner nearby got a bigger lease payment and the potential boom has become "coffee shop talk," Richardson said.

"It's hard to find anyone that is a naysayer about it."

At a recent job fair in Hutchinson, companies were looking for drilling rig workers at wages of $22 an hour and pipeline welders at $32 an hour.

Shawn Rosenberg, 39, left his job as a stocker for Coca-Cola to study natural gas technology at a community college in Great Bend, Kan. He thinks he can get an entry-level energy job that will pay at least $35,000 a year.

"In this area that is pretty good," he said. "I want to have an opportunity to move up."

Kiowa, with just over 1,000 people, was a starting point for those seeking free land in the Cherokee Strip Land rush to Oklahoma in 1893.

Today, it's seeing another opportunity. One energy company gave the town $72,000 for a digital projector for its movie house and another has paid for equipment for its police and fire departments.

But the town, although optimistic, is taking a cautious stance. The energy companies have told Mayor Farney they will let him know when the energy boom is for real. So far, he said, he hasn't heard back.

Faye Conaway and Bob Pedigo are partners spending $800,000 on a new 20-room motel in Kiowa that will open next year. The motel will serve workers and others associated with the energy business flooding into the area.

"I think there is a future here," said Pedigo. "But if the oil business goes away, all bets are off."

A difference maker

Wayne Woolsey owns Woolsey Energy Corp. in Wichita, which has a deep history as part of a Kansas oil industry.

The state's best days were in the 1950s and early 1960s. Crude oil production peaked at 124 million barrels of oil per year and 883 billion cubic feet of natural gas.

In 2011, the state produced just 41.5 million barrels of oil and 322 billion cubic feet of gas. The average Kansas oil well now produces less than 3 barrels of oil a day.

In the mid 1990s, Woolsey decided to focus on some southern Kansas counties over the Mississippi Lime.

The formation was well known to Kansas oil companies. For decades, they had drilled vertical wells there. For some of the vertical wells, they had even used fracking, which uses pressurized water, chemicals and sand to fracture rock and release oil and natural gas.

Fracking actually has a long history in Kansas. It was the first state to try the method -- in 1947 -- and over the years deployed it in more than 50,000 vertical wells not only in the Mississippi Lime but other rock formations.

Energy companies have now developed horizontal fracking which is far more productive. It has become controversial in many parts of the country because of fears that it will contaminate ground water. So far, studies have given support to both sides of the debate.

Although vertical fracking in the Mississippi Lime wasn't that productive, it left behind a record of production and geological information that is helping energy companies study the formation.

Woolsey, working with a geologist, became convinced there were several hundred million barrels of oil that could be recovered with horizontal fracking in just a few counties in southern Kansas.

He drilled three wells and each was a disappointment. The fourth wasn't.

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