News from the Oklahoma Corporation Commission

Jim Palmer, Director of Information

July 12, 2000

ENCOURAGING NEWS FOR OKLAHOMA’S OIL AND GAS PRODUCTION COMES FROM NEW DRILLING PERMITS, THE ACTIVE RIG COUNT AND A CLEAR UPWARD PRODUCTION TREND IN THE FIRST QUARTER

(OKLAHOMA CITY) – If you are looking for good news in Oklahoma’s oil and gas production fortunes, there are some encouraging numbers which indicate a turnaround from last year’s oil and gas depression.

The number of permits-to-drill filed with the Oklahoma Corporation Commission’s Oil and Gas Division climbed to 420 during June. This is a 93% increase since January. Permit figures for the first six months of this year compared with the same period in 1999 reveal a 40% hike.

Commissioner Denise Bode said "hopefully, with these higher numbers, producers are beginning to feel a little more confident about their ability to drill and produce wells without fear of OPEC sending prices back to the basement. Certainly, with the impact of higher gasoline prices on consumers, everyone is more aware of the need for a domestic energy policy to protect the nation from foreign market control."

More good news for Oklahoma can be found in the number of active drilling rigs. As of June 29, there were 120 drilling rigs. In January there were only 88.

Commission Chairman Bob Anthony, encouraged by the numbers, said "The increased drilling activity is the result of hard work by many people. Certainly the higher price plays a major role, but so do advancing technologies which bring better return for a company’s investments, the legislature’s willingness to extend the production incentives program and the Commission’s streamlining of processes to reduce the cost of regulation."

Crude oil production figures for the first quarter of 2000 are up over the first quarter of 1999. The first quarter total last year was 16,984,221 barrels compared with this year’s higher first quarter total of 17,241,968 barrels. The average price of crude during the first quarter of last year was $11.51 per barrel while this year’s first quarter price averaged $28 per barrel.

Natural gas production during the first quarter of this year was also higher than the first quarter of 1999. Last year’s first quarter totals were 346,829,015 mcf (thousand cubic feet). This year’s first quarter was higher at 350,478,295 mcf.

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The average price of natural gas during the first quarter of 1999 was $1.60 per mcf increasing during the first quarter of 2000 to $2.34 per mcf.

The average price for a barrel of crude oil during April 2000 was $25.29, down from $29.28 in March.

The average April price for natural gas was $2.71 per mcf, up from $2.42 per mcf in March of this year.

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