When I think about oil, the Middle East comes to mind. Yet these days, folks might be thinking of America’s West. The region is booming in oil production due primarily to the controversial tactic of Colorado fracking aka horizontal drilling and hydraulic fracturing.
BSG Frak vs Fracking
While the fictional television show Battlestar Galatica may have made the word Frak popular (in the eighties, the show was promoted as using the “F” word). Colorado Fracking is not universally loved in the present. There is a very vocal debate between proponents and environmentalists. Weigh in below, I value your insight.
Money of course is the big fracking draw on oil in Colorado and to the north, and it is creating a real estate boom that will affect everything from water rights to construction to building materials and house values and even the current State secession talk of the several counties in Northern Colorado. We are talking about a lot of oil and a lot of money.
Oil Production Up Dramatically
Back in 1999, Weld County had a total annual production of 6.48 million barrels of oil for the year. Contrast that with the start of 2013 – already over 7 million barrels for the first three months of the year. In 2012, driven by the success of fracking Colorado ‘s Niobrara Formation in Northern Colorado, Colorado produced a whopping 49 million barrels of oil. This accounted for 75% of all oil drilled in Colorado.
Reducing Property Taxes
The surge in oil production allowed Weld County to reduce property taxes across the board by about a fourth. And simultaneously, the two largest energy producers were responsible for just under a $150 million dollars in tax revenue. Fracking is big money and oil production is likely to increase in Colorado.
Tie to Boulder Real Estate
As oil production increases in Colorado and the American West, expect to see real estate values climb. Areas such as Weld County are likely to see values increase. Boulder Colorado is already in the midst of a 15 month run up in values. CoreLogic reported on Tuesday that real estate values were up in the 100 largest US cities and 48 states. Most places are not experiencing an oil boom, so expect to see Boulder values really climb in relation to other states.
Fracking is bad news bears. Commercial Hemp production is the direction Colorado should take. Utterly sustainable, and environmentally beneficial in every manner. Hemp seed oil is the original and most exceptional biofuel. Not to mention building materials, cloth, paper, rope, plastics, food– no slaughter of forests, or poisoning of rivers, streams, or aquifers. Petroleum-based products are devastating from point of extraction to disposal. The high value of properties will collapse eventually from the environmental damages associated with petroleum extraction.
Jeff, thank you for taking a moment to chime in. You make some valid points and I’m sure readers appreciate your insight. I know I do. Thanks.
I found this episode of This American Life about Fracking fascinating. I think back to it every time the subject comes up. It aired two years ago, and it still haunts me. If this story is true – Fracking is not worth it.
http://www.thisamericanlife.org/radio-archives/episode/440/game-changer