BP to Increase Natural Gas Recovery From San Juan Basin

Release date: 29 January 2007

(Houston, TX) BP today announced that it will invest up to $2.4 billion over the next 13 years to increase its share of ultimate recovery of coalbed methane natural gas from the San Juan Basin of southwestern Colorado by an estimated 1.9 trillion cubic feet. The company anticipates a steady development program that will increase current BP net production of 425 million cubic feet per day by more than 20 percent, and maintain production above present levels for more than a decade.

The project includes funding for the drilling of more than 700 new wells for which BP has obtained regulatory infill approval, and associated field facilities. To minimize environmental impact, BP plans to drill nearly all of the new wells from existing well pads, using existing roads and pipelines where possible.

“This investment will allow us to continue the responsible development of one of the largest gas fields in the US while enhancing our ability to continue delivering clean-burning natural gas to domestic markets,” said Tony Hayward, Chief Executive, BP Exploration and Production.

Today, coalbed methane gas accounts for about 10 percent of US domestic gas production. BP started development of this important clean energy source when it began testing production methods in the San Juan Basin in 1976. It has been a leader in coalbed methane technology development and production ever since.

The San Juan Basin project is part of a 10-year, over $45 billion US oil and gas exploration and production program that includes major investments in the deepwater Gulf of Mexico, Alaska and the Lower 48 states.

“BP is investing heavily in secure sources of energy for the US,” said Bob Malone, Chairman and President of BP America. “Continued development of the San Juan Basin is an important part of that effort.”

Notes to Editors:

  • BP is among the world’s largest energy companies with operations in 110 countries and more than 100,000 employees. In addition to the production and manufacture of oil, natural gas and petrochemicals, BP is a leading manufacturer of solar electric modules and plans an investment of $8 billion in its alternative energy business over the next decade.
  • In 2005, the US accounted for about one-fourth of BP’s global oil and gas production of four million barrels of oil equivalent per day. Natural gas accounted for about 40 percent of BP’s US production.
  • BP is a leading producer of natural gas in the San Juan basin of Colorado and New Mexico, where the company operates gross production of 900 million cubic feet per day, more than 1.5 percent of domestic supply, from 3,400 wells in this prolific region.
  • In the 1980s, BP pioneered the production of natural gas from layers of coal, a process that involves de-watering the coal formations. In Colorado, all produced water from BP production is reinjected into subsurface formations. Today, the company continues to expand the use of innovative technologies for coalbed methane development with new directional and horizontal wells. A showcase development in the San Juan National Forest demonstrates how natural gas can be successfully produced in sensitive environments.

Further information:

Office: BP Press Office
Location: London
Phone: +44 (0)207 496 4076

Office: BP America Press Office
Location: Houston
Phone: 281-366-4463

Name: Dan Larson
Office: BP Public Affairs
Location: Durango
Phone: 970-247-6817